Preventive vs. Reactive Fleet Maintenance
There are many benefits of using fleet and asset management software in a medium to large fleet operation: time savings, efficiency improvements, and better reporting to name a few. This post will be the 1st in a series that highlights the potential return on investment you can expect to gain from Collective Data’s suite of high-end fleet software products.
In this post, we’ll cover the return on investment an organization can gain through more effective preventive maintenance vs. reactive maintenance.
Believe it or not, there are organizations out there still using the reactive maintenance strategy, which simply means letting equipment run until it breaks. Why is it still common? The biggest reason is that it requires less oversight, less staff, and less planning. Many know that preventive maintenance can reduce costs and increase the life of equipment, but they know that there is more planning involved. Some managers are concerned that software needed to keep it all under control will actually become burdensome to use. That’s where Collective Data comes in. The software is easy-to-use and can make managing those P.M. tasks easier whether you have hundreds or thousands of pieces of equipment.
A well-planned and effective preventive maintenance program should reduce unscheduled downtime repair costs by at least 25%.
* This is a conservative estimate for analysis purposes. Clients may see an even greater reduction amount.
Now let’s crunch some numbers for a potential savings through Collective Data fleet and asset management software.
Let’s assume an organization has the following fleet makeup:
- 200 light equipment units
- 200 heavy equipment units (garbage trucks, excavators, etc.)
While every situation is different, let’s use a conservative estimate that there is typically 1 unit in the shop for unexpected downtime repairs for every 100 active units in the fleet. The repairs cost $750 per day (parts and labor) per unit. Depending on the type of equipment and the repair needed, it could be less or much more per day. Also, there are many other costs associated with downtime, but we’ll use those basic assumptions for this analysis.
Reactive Repair Costs Per Week = $750 x 5(days) x 4(units) = $15,000 x 52(weeks/year) = $780,000 Unexpected Repair Costs Per Year
By implementing Collective Data fleet management software, you can expect to see the follow return on investment:
$780,000 Reactive Maintenance Costs Per Year x 25% reduction due to pro-active preventative maintenance = $195,000 in potential savings for this particular fleet size.
In this one aspect alone, a fleet will see a substantial return on investment by reducing unexpected downtime repair costs with the help of Collective Data fleet management software.
Want to see other potential returns you can expect to gain from Collective Data’s fleet management software system?
Download our free Return on Investment white paper to learn about other benefits you’ll see such as better parts inventory management, warranty tracking, inventory reduction, and labor productivity improvements.