The Expense of Fueling Transport Van Is Too Much For Some Companies
It was only last year that many companies in the US and UK were forced to take drastic action when petrol prices took a sharp rise. Many who relied on large fleets of vans to transport goods all over the country were forced to slash employee pay and take a number of their vehicles off the roads.
Fleets may need to be reduced even further now and companies pushed even closer towards breaking point as the government announces predicted further cost increases in the coming months. What is frustrating many business owners about this situation is the lack of information it gives them to predict profit margins. “We get a set of forcasts drawn up and then they mean nothing when petrol goes up so much” argues Jerry Henley, Managing Director of JHG Foods. Around 25% of all companies in the US that were heavily reliant on transport, went into administration last year, which is a figure many predict will be replicated this year as well.
For companies that rely so heavy on petrol prices to turn over a profit, the news of another rise has not been well received. “We cannot survive much longer” claims Judith Grey, MD of UK-based company Grey Kitchens. Our customers expect their furniture to be delivered to them, which is something that is becoming financially unviable for us now. Lots of businesses like this found some salvation in van leasing in an attempt to cut their costs. Because they are not buying the vehicles outright, they can afford to spend more on petrol whilst maintaining their margins. Interestingly, Citroen van leasing has been the most popular choice as on average these vans offer the best MPG. Ford van leasing is also up their with the most popular choices as their reliability is well respected in many industries.
