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How To Keep The Wheels Turning For Your Transport Business

Experts in the fleet and transport sector share their insights into the industry challenges and opportunities for businesses that rely on critical logistics services.

Catherine Bristow

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“Whether your fleet consists of ten vehicles or 1 000 plus, it always boils down to the cost of maintenance, fuel and cost-efficient routes,” said Dr David Molapo, Head of Fleet Management, Vehicle and Asset Finance at Standard Bank, at a round-table event hosted by Standard Bank to determine key areas that business owners and transport managers must focus on in order to keep costs down and profits up.

Key discussion points included:

  • Mitigating fuel costs for business growth
  • Implementing tools and telematics to save on transport and fleet spend
  • Training and monitoring drivers to ensure driver and load safety
  • Mitigating risks such as hijacking, driver behaviour and delivery delays
  • When to bring services in-house
  • Complying with legislation.

Change with the market

“We used to subcontract our transport to other companies. However, there were very few vehicles that were servicing the Durban Johannesburg leg, so we got vehicle and asset financing and purchased some of our own trucks to take our cargo,” explained Trevor Pillay, owner of Shan’s Transport and Logistics Agency.

Related: How Do I Start A Transport Or Logistics Business?

“On the return leg we began making money. However this changed when the market changed and the route suddenly became competitive, which meant that we needed to carefully monitor our fuel consumption.”

To remain competitive in the market, Pillay and his business began using fleet cards. “We get an SMS as soon as one of our drivers fills up and we allocate a certain amount of fuel for the trip so we know upfront the consumption of fuel. The driver can then fill up at a petrol station where we receive a benefit,” said Pillay.

“Our trucks are only allowed to go to a proper truck stop and not use any petrol station that they choose,” agreed Hennie Engelbrecht, director of Kopano Fuel. “Price is king and we have found that paying in advance to specific dealers and forming relationships with the person at each fuel dealership has assisted us with our fuel consumption.”

Implement smarter ways of doing business

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Other fleet owners have found that fleet telematics systems are essential to managing costs. “We use a mixed telematics system quite extensively,” said Reinard Basson, financial manager for Shoprite Group Transrite National.

“Telematics helps us to calculate the kilometres travelled and the fuel consumption on each vehicle. Each of our drivers receives a scoring which tells us what their harsh braking score is, which means that we can do a fuel consumption score per vehicle as well as per driver.”

Related: Trucking Business Plan Sample

Basson believes that you can’t manage what you don’t measure, and so his company focuses on the details.

Fuel consumption and the cost of repairs and maintenance according to each region is measured. “We drill down into the details,” he said.

“We install tracking units in our vehicles and have a screen in-house to track the vehicle behaviour: How fast the driver is braking, how harshly he is steering and how much petrol is being wasted,” added Dorin Charalambous, MD of DSC Transport.

Reduce insurance costs with telematics

“There is a change in the insurance industry with the introduction of telematics to monitor routes, weather conditions and time taken, and to price accordingly,” said Bryan Verpoort, Head of Corporate and Business Insurance at Standard Bank.

“The thinking around this is to consider punitive benefits. For example, the insurer may advise you not to operate within a certain window due to high risks, but if you as a fleet manager decide to do so, you will receive the cover but your policy will have an increased excess.”

Related: How To Start A Passenger Transport Business

Verpoort advises that if fleets are managed and operated properly this will reflect on the price. “It’s important to build up a long-term track record where insurers can identify you as a professional operator, as professional operators will always have lower claims. Generally, house-keeping goes across the whole business,” said Verpoort.

“How you manage your staff, your warehouse and your transit will impact on your insurance pricing.”

Catherine Bristow is the online editor and content marketing manager for Entrepreneur Magazine. She brings to the mix a BJourn from Rhodes University, Honours in Psychology as well as a certificate in Accounting and Commercial Law.

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How to Guides

(Podcast) Phone Calls Often Solve Email Problems

Irate customers can become your most ardent supporters, but it’s important to treat your clients like people. People like people, and phone calls are more personal than emails.

Nicholas Haralambous

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Emails solve problems – but they also create them. When a real problem arises in your business, is an email the best way to solve it, or should you pick up the phone and give your customer a more personal experience?

Irate customers can become your most ardent supporters, but it’s important to treat your clients like people. People like people, and phone calls are more personal than emails.

Listening time: 3 minutes

Related: (Podcast) Being An Entrepreneur Is Painful

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Company Posts

Why Choose ISO 90012015 As A Starting Point For Your Business

Implementing all elements of the standard can help your business, but what parts of the ISO 9001:2015 standard in particular should prove to be of most beneficial for yours? We’ve listed a few below.

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Ask for any Entrepreneur’s to-do-list, ISO Implementation and certification may not always be at the top of it. Businesses are constantly faced with financial, operational and socio-economic pressures, while business owners must make decisions on projects related to “cost vs the benefits”. But here’s why ISO 9001:2015 is a reasonable investment.

If your businesses is certified under ISO 9001:2008 you had three years to transition to ISO 9001:2015, if you don’t transition, your certification will become redundant. The three‑year period started on the date the new standard was published in September 2015. Don’t wait, your Day 1 of 365 days starts now.

Related: How ISO Certification Can Help You Access Market Tenders

Implementing all elements of the standard can help your business, but what parts of the ISO 9001:2015 standard in particular should prove to be of most beneficial for yours? We’ve listed a few below. It may also protect your business (against big business)

How can ISO 9001 make the difference for my business?

Start by viewing the costs as an investment that allows you to better assure your clients, improve your productivity and raise your ability to compete.

Your certification to the standard, can attract reputational benefits and establish a ticket to levels of business that non-certified companies certainly cannot obtain. This may be the most practical time to implement ISO 9001 for your business.

As the full process can take up to 6 months, you need time to plan and execute your transition to the new standard and it will require work, commitment and changes to the habit of doing things.

This is why it’s vital to begin early and hire consultants with a 100% certification record with any SANAS (South African National Accreditation System) or International Accreditation Body. It gives the guarantee and expertise you need.

iso-process

Your 6 steps to getting ready for ISO 9001:2015

1Establish Processes

  • Documenting and Implementing processes in your business can yield great benefits as your business grows. Setting common processes in the beginning will result in consistency in the products and services, this sets a sound foundation for expansion and future growth.
  • Save time, cost, and ensure delivery. This takes place when you have new employees and point them to processes that are well established and well documented.
  • It allows your staff to feel confident in doing their job, knowing there is a process to follow and with the help of the Document Control Process, you can always re-engineer the process to adapt to change, this results in Continual Improvement.

2Formulate PDCA cycle (Plan-Do-Check-Act)

  • The fundamental basis of the ISO 9001 standard is based on Edward Deming’s PDCA Model. If implemented effectively it can benefit any type of business however large or small you are, it’s practical. The Method is also used by fighter pilots.
  • You build a culture of “careful planning, monitoring, and adjustment of actions” this speaks volumes to your employees, and your clients benefit in return.

3Increase your sales by using ISO 9001

  • By using valuable customer feedback, you build up information to monitor and review your client’s perception of your products and services, this feeds into a corrective action process, which results in a continual improvement to create relationships with existing clients and attracting new clients.
  • Most Tender Requirements from Government, Local and International Companies require ISO 9001 as a qualifier to their procurement process. This gives them the assurance that a Third Party Auditor is auditing an effective Quality Management System aligned to International Standard that has effective process control and will measure client satisfaction.

4Develop an attentive mindset to risk and opportunities

  • Risk and opportunities is the latest introduction to the ISO 9001:2015. This allows businesses to identify potential and current risks in their process and mitigate them before it’s too late, the fundamentals of a successful business.
  • By cultivating a culture where your team have a sharp eye for risk and opportunities will serve your business well.
  • Profits will be maximised while risks are spotted early and can be minimised.

5Take control of change management

  • As the saying goes, “Change is the only constant in the 21st century”. The inability to handle change and adapt accordingly is one of the main reasons that many businesses do not survive through the first two years of existence.

Related: 7 Steps To Achieving Our Higher-Level Goals

6Setting goals and objectives

  • Goals and objectives are key fundamentals of the ISO 9001:2015 standard, these are tools to assist in attaining your companies Vision.
  • When you get into the habit of setting, reviewing, and taking action against objectives, the end results is growth and driving improvement.

It is clear that implementing ISO 9001 can take your business to the next level that benefits startups to established corporates. We stress again the vital importance to begin early and hire consultants with a 100% certification record with any SANAS (South African National Accreditation System) or International Accreditation Body.

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Company Posts

How ISO Certification Can Help You Access Market Tenders

Want to leap-frog your competitors by building your business credibility?

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ISO Certification

2017 has been a challenging year thus far. A decline in exports, slower growth in private consumption and fixed investment has caused the economy to contract in Q1 and enter into its second technical recession since 2009. This means that it is now more crucial than ever to break away from your competition to survive in this economy.

The question we as businesses are all asking, is how can we become more competitive during these tough times?

The answer is ISO Management systems and certification.  The implementation process allows organisations to streamline their processes and benchmark to international standards that have worked for the likes of Toyota, Coca Cola, MTN SA and many more.

The ISO Certification gives your clients the national and international credibility that they are looking for, in you as a business.

What are ISO Standards?

ISO is not an acronym, it is derived from the Greek word ISOS, which means equal and is interpreted as The International Organization for Standardization, which comprises of various National Standards being superimposed into one International Standard. There are approximately 21500 ISO Standards, from Quality, Health and Safety, Information Security, Environmental, Energy and many more. (The International Organization for Standardization)

The ISO standards set a precedence for companies to create a Management System which comprises of Policies, Objectives, Processes, Risk Assessments and Procedures with the aim of being able to provide a consistent service.

The standards requirements can assist a one-man tuck shop to large corporates such as Google.

Think about it this way, when you buy a house, does your insurance company grant you a policy without an Electrical Certificate of Compliance? Do you buy a brand new laptop, mobile device or any other electrical device without a warranty or guarantee? Will you send your child to a hospital that does not have standards in place? Will you buy vegetables that have not undergone the necessary food safety controls?

We, as consumers, have all become cautious, hence the birth of ISO Certification. An independent body (Watchdog) such as the SABS, BSI, TUV, and Bureau Veritas conduct regular audits against your processes and the International Standard to create the assurance you are looking. How ISO Standards And Quality Management affects SMMEs

That is why your company must invest the time and money to implement the value adding systems with the right consultant. This in turn will provide your current and potential clients the assurance that you have the relevant processes in place to deliver what is required and will provide you with the competitive edge. You are not too small to become ISO certified.

Where do I start if I want to become ISO Certified?

where-do-i-start-if-i-want-to-become-iso-certified

ISO Management systems work on a four-phase approach to develop, implement, train and assist organisations through certification.

The following will give you an overview of how the process works:

Phase 1: GAP analysis & Identification of processes

  • GAP Analysis Audit on the choice of your ISO Standard
  • All Staff to undergo awareness training on the ISO Standard (Requirements)
  • Analyse & identify current systems (Policies, Objectives, Risks, Processes and Procedures) within the company and gather information.

Phase 2:  ISO Management System Development

  • ISO Management systems manual (Policies, Objectives and Mandatory Procedures)
  • Process documentation and Standard Operating Procedures
  • Risk assessments and tools to assist in Monitoring, Measuring and Analysing. 

Phase 3: Implementation

  • Coaching and change management of Top Management and attaining Leadership Values.
  • On the job training with all staff and workshops on the ISO Management Systems
  • Internal Auditor & Maintenance Training
  • Internal Audit, non-conformances, corrective actions and reviewing of risks
  • Management Review Meeting and Review of all Statistical Analysis.

Phase 4: Certification

  • Stage 1 Desk Study Audit with the Certification Body
  • Stage 2 Certification Audit, Non-conformances and Corrective Actions completed
  • Annual Surveillance Audits to justify continuous improvement.

ISO standards aren’t rigid rules, but rather a set of generic requirements and guidelines to what we as a business should be following.

It’s the basics of business, we tend to overlook the basics and focus on profits, which jeopardies our quality and service.

Your clients are becoming more advanced, better informed and their expectations are growing. Having ISO Management Systems provides organisations with the competitive edge over their competition, by gaining National/International recognition.

In fact, any organisation, whatever their size or industry sector can give themselves a secure future by introducing ISO Management Systems. Remember to look for management systems that can guarantee 100% certification with any certification body such as SABS, TUV, BSI, Bureau Veritas, DEKRA etc.

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