Boss Lady

Save money on a business vehicle if it’s time to buy one

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Whether you need cars for you and your staff to visit clients, SUVs for a delivery service or luxury vehicles to transport your customers through the city in style, having the proper approach to company-owned cars can be both a critical part of your business plan — and one of your biggest expenses on the business balance sheet, so you need to look at doing it efficiently.

First of all, you need to examine whether it is really time to purchase a business vehicle, considering the size of your company and what industry you are in.

Around 21% of businesses in the U.S. have a majority female ownership, as reported by the U.S. Small Business Administration Office of Advocacy, and small businesses form over 99% of these businesses. As a whole, business vehicles are associated with larger companies and those specializing in delivery and supply.

However, across a wide array of industries – including restaurant ownership, sales, technology, and specialized services, a business vehicle can sometimes be necessary. This is especially true when employees are called upon to visit clients frequently, make interstate trips, and attend to clients in their place of work or home. If you are a small business owner seeking to relieve employees from having to put their own vehicles at risk for company-related trips, what are signs that now is a good time to start looking for one or more vehicles?

Your Sales Team Is Increasingly Attending Customers At A Distance

Small businesses with teams that occasionally make interstate or long-distance trips may decide to simply reimburse staff for expenses incurred by transportation, but the frequency of these trips – and the distance covered – may weigh the balance in favor of a business vehicle. Your employees may also express concern about the number of miles they are racking up on their personal vehicle. If you decide it is time to take the plunge, then finding a loan for a car should be your first consideration.

You should talk to several financial institutions and look into various loan product types, finding one that is customized to your needs and that offers good interest rates. Opt for the shortest repayment period possible, since some institutions offer lower interest rates for timely repayment, coupled with a good credit score.

 

A Novel Means Of Advertising

Vehicle wraps have one of the lowest costs per thousand impressions when compared to other advertising channels, since they generate around 101 impressions per mile. If you have a local business and your team is out on the road for several hours a day, then a business vehicle is a great way to show off your brand logo, build brand awareness, and let other drivers know that your service is locally available. Research compiled by the American Trucking Association revealed that 91% of audiences notice both text and graphics on vehicle advertising, so if you invest in this means of marketing, ensure yours are visible, readable and colorful.

 

You Work In A Luxury Customer Service Field

Whether you own a small luxury boutique hotel, you take high-end tourists on guided tours of your city, or you have a catering business, a company vehicle can be an excellent means of adding prestige and visibility to your company. Often, these industries involve meeting clients and driving them to sites, hotels or venues. Doing so in a dedicated, branded vehicle can help strengthen your brand’s prestige and establish your company as a solid, trusted supplier for your customers’ needs.

 

Small businesses often begin by making do with existing vehicles. However, if staff regularly need to drive to visit clients, supply them with goods or services, or transport them from point A to B, investment in a company vehicle is probably a good idea. The 179 deduction will enable you to deduct a large percentage of the cost of the vehicle in the first year; all you need to do is prove that you use it primarily for business purposes. Moreover, you can rest assured that staff are not concerned about their personal vehicles suffering from depreciation owing to high mile totals per year.

 

 

If you follow some easy strategies, you can save money. As with any other vehicle purchase, leasing and looking after ongoing costs, knowing what you want and having the flexibility of the best choice can be crucial to making it affordable.

Ask the right questions

The wider the network in terms of potential vehicles, the easier you can find an acceptable deal. But just as important as the price is whether the car or cars meet your needs. Think about what your must-have has in each vehicle, and then try out every option to get a first look at the driving experience. Consider how the cars are used and who uses them. Comfort can be crucial if, for example, long distances are to be driven, while when moving furniture, the cargo space is of the utmost importance.

Compare deals from different fleet managers

If you are going to need more than one vehicle, it is useful to negotiate with fleet managers. Most car dealers have a fleet manager who supports the sale or leasing of multiple vehicles for a company. If you use the fleet manager, you get a better deal than you could secure when you walk off the road, because car manufacturers often offer discounts to those who shop in large quantities. Some also require minimum order quantities, so make sure this is part of your decision-making process. If you only need six vehicles for your delivery service, you’ll lose some of your potential savings if you focus on a manufacturer for which a company needs to buy or rent 10 cars to qualify. Don’t just make a deal with the first fleet manager you talk to. Compare offers from several, and work out which will be the best one to suit your business.

Consider the ongoing costs

When choosing the vehicle, take into account the servicing costs — and see if there are special capped-service deals available. Also consider the level of insurance and liability cost you will need. And don’t forget one of the biggest ongoing costs of all: the fuel. Further, keeping track of fuel usage itself can be a nightmare… who wants to end up with a fistful of receipts from fuel stations, or have to go through the credit card statement at tax time? This is where business fuel cards can save you money and problems — and you can shop around for the right fuel card with comparison sites such as https://www.icompario.com/en-gb/.

Know your options

Running a business vehicle — or even a whole fleet of business vehicles — is in some ways like buying a personal car: there are many additional options to consider with the car. You may be able to enter into a prepaid maintenance contract, sign an open-ended lease, or pay through an individual billing plan. Similar to buying a car, there is also a need to buy something. Different dealers can present different prices and packages, even for the same vehicle model. A few phone calls and a bit of leg work can save hundreds or thousands of dollars.

Taxes and insurance

The allocation of business vehicles can lead to headaches at tax times if your documents are not in order. In order for the vehicle to be considered to be the company’s own property, it must bear the name of the company. In order to separate business use from personal use, drivers must keep logbooks, which management often needs to remind, as personal miles are booked as ancillary benefits and personal taxation to lose. Don’t forget that you also need to take out car insurance. If you use your vehicle for business purposes, an insurance company may refuse a claim against your personal car insurance for double use.

About Karli Cowan

karlic@thebusinesswomanmedia.com'

Karli Cowan has for decades been one of the all-too-few women in the automotive industry, and is committed to helping women better negotiate the male-dominated industry.

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