How to improve the fleet supply chain procurement process

supply chain procurement process

No industry feels the effects of supply chain disruption more than fleet procurement. In 2022, over 42% of fleet managers said that they needed to purchase a different vehicle brand due to longer lead times and reduced chassis availability.

Although the supply chain itself cannot be controlled, the fleet procurement process can. Your organization can adapt its current procurement process to changing expectations and emergent situations.

Here’s everything that you should know to get started.

How modern fleets are impacted by changes to the supply chain

The modern fleet procurement process is subject to constant change, especially when it comes to supply chain stability. Beyond environmental, political, and financial events, even tiny changes can have an enormous impact on school and government organizations.

Public fleet managers continue to face an uphill battle. In a 2023 survey from NTEA, researchers found that:

  • The average age of commercial vehicles has continued to rise. Roughly 69% of fleet managers say that their vehicle ages have exceeded normal replacement cycles due to holes in the supply chain.
  • Longer lead times continue to crush fleet vehicle acquisition timelines. In fact, bloated order-to-delivery times were listed among the top five biggest challenges to modern fleet procurement managers.
  • Increased acquisition costs muddle procurement processes and make it difficult to maximize leaner budgets. In response, smaller organizations with less flexibility say that they are looking to reduce vehicle lifecycle costs, backfill deferred vehicle replacements with cheaper options, and limit idle time and unnecessary fuel expenses.

The modern supply chain is complex at best, complicating the fleet management process for public organizations. That said, fleet procurement managers can take measurable steps to improve their operations and mitigate the impact of disruption on their fleets.

Three ways to improve your fleet supply chain procurement process

Public fleet procurement managers should consider these findings as launching points for developing a more robust procurement system. In order to improve your public supply chain procurement process and increase supply chain resiliency, be sure to consider the following strategies.

1. Implement telematics

Telematics can help you monitor key data and make better decisions about when to replace a vehicle. Today, thousands of fleet managers are adopting new technology to enhance their visibility and inform decision-making processes.

Statistics show that 79% of fleet managers use drive and duty cycle data, while 81% use telematics to monitor their vehicles and drivers. Consider all your options while picking telematics for your organization.

2. Lean into automation

Automation is a sustainable way to do repetitive work and delegate tedious tasks. Advanced programs or algorithms are also highly efficient at tracking and managing the vehicles in a public fleet.

Approximately 91% of fleet managers use safety and automation options to increase their efficiency and maintain currently owned vehicles. The more you use, the more integrated your fleet can be, and the longer you can maintain your current fleet vehicles in the event of supply chain disruptions.

You may want to acquire automation programs for:

  • Tire pressure monitoring
  • Collision avoidance
  • Lane departure warnings

Be sure to evaluate all your options before making an investment for your fleet.

3. Limit the use of traditional RFPs

It can take between nine and thirty-six months to procure equipment with traditional RFPs. Not only is this unsustainable amid supply chain disruptions, but it could also tie up internal resources and prevent you from acquiring vehicles quickly.

This is why cooperative contracts have become popular solutions for public fleet managers, as they reduce the contract completion process to as little as one month. In addition to saving time, you can save money, since there's no need to pay writers or your administrative staff to complete tasks outside their expertise.

Cooperative contracts are available to schools and governments interested in streamlining their fleet procurement process. If you're unsure of the steps required or are unfamiliar with the terminology, you can get started with cooperative contracts by working with the team at Sourcewell.

Implementing cooperative contracts with fleet supply chain procurement processes

Cooperative contracts are part of an alternative fleet supply chain procurement process to traditional RFPs. Multiple organizations join together in a purchasing agreement, lowering costs via economies of scale and completing the bidding process in advance.

A cooperative contract saves time, money, and effort, helping public fleet managers circumvent the instability of the modern supply chain. There is no obligation to browse or sign anything, and no membership fees are expected to join.

With Sourcewell, cooperative contracts are available to public organizations across the United States and Canada.

Here at Sourcewell, we help public agency buyers procure fleet vehicles faster by fulfilling the time-consuming bid process for them. Through cooperative contracts, we expedite the fleet vehicle procurement process so you can better serve your teams.

Want a faster procurement process? Contact one of our specialists today to buy the fleet solutions you need!