radiusHead of Sales at Radius Payment Solutions Ltd, David Mountfield, discusses why he thinks smaller courier companies are well-placed to use telematics to deliver greater profitability.

With a growth in demand and a rapidly evolving industry, the opportunity for independent couriers has never been greater.

A recent survey of the parcel delivery industry found that private couriers received an overall customer satisfaction rating of 80 per cent, topping the high flying larger organisations – Hermes scored 78 per cent and Yodel just 67 per cent.

However, with one day, same day and free delivery all expected in internet shopping, smaller couriers have their own barriers to overcome to reach sustainable profits and efficiency. And, like the larger delivery companies, the independents are looking to technology as a solution to the everyday challenges they face.

There are two main issues for courier companies in the current climate – fuel usage and price volatility and vehicle and driver productivity.

Vehicle telematics could be the solution to both these obstacles. Essentially a live reporting tool, telematics provides useful data in relation to the fleet’s recent journey – from fuel usage, GPS and, most importantly, the driver’s road behaviour and performance. This can be actively used to reduce inefficiencies and boost profits.

Reduce your Fuel Usage

The volatility of fuel prices makes predicting profit levels difficult for courier companies. One way to reduce uncertainty, however, is to simply reduce your fuel use.

David Mountfield
David Mountfield

The data collected by a telematics system allows you to assess the driving behaviour of the workforce, recording incidents of speeding or harsh braking etc. This allows you to address these bad habits and inefficiencies – which ramp up fuel consumption – and thereby reduce the amount of fuel your business needs to operate.

Our Kinesis telematics system marks the overall driver performance out of 100, meaning you can easily identify those who may be increasing your overheads. By installing a telematics system, some companies have reduced their fuel bill by more than 20 per cent.

Boost your Workday Efficiency

If operating a manual system for handling deliveries and drivers, coordination of collections and drop offs can be highly inefficient – wasting time and money.  For most companies with a workforce dispersed and constantly on the move, it becomes very difficult to effectively monitor and manage drivers’ tasks.

A telematics GPS feature allows improved vehicle routing using the live map – helping drivers fit more deliveries into their schedules. This is important for all couriers, but can be crucial to a small fleet where each vehicle provides a greater proportion of overall profits each day.

Focus on Customer Satisfaction

Competition is constantly growing as new players enter the delivery market – each targeting a slice of the online retail opportunity. This puts more pressure on courier companies to distinguish themselves from their rivals. While independent couriers often gain the upper hand when it comes to customer service because of the personal touch they can provide, it’s crucial that they work to maintain and increase this advantage.

The real-time map feature of a telematics system can be used to track drivers’ progress accurately and provide customers with precise delivery times. This could further boost your customer satisfaction rating and separate you from the competition.

Deliveries is a competitive and challenging business to be in, as the struggles of Yodel, Hermes and Royal Mail bear out, but there are great opportunities for independent couriers to capitalise on the dissatisfaction among customers of the big boys.

Telematics could help you do just that – and in a way that is miles more profitable.

By Alison