How to Choose a Business Vehicle Program: 6 Questions to Ask Yourself

Whether you’re a small business owner supporting a few remote employees or a regional sales manager overseeing an entire mobile workforce, it’s not always easy to find the right vehicle program for your business. There are a number of factors to consider when deciding which type of vehicle program will support both the needs of your employees and your bottom line. You’ll need to think about the overhead costs, potential liabilities, and administrative burden associated with each vehicle program option. Thankfully, this process can be streamlined to help you make the best decision to suit your company’s unique needs.

To simplify the decision-making process, consider the three essential business vehicle program options available to you, which include a fleet program, a vehicle reimbursement program, or a custom hybrid program. Each of these offer different advantages, so you’ll want to think about what’s going to work best for your business.

Questions to consider

To help you think through which factors will matter most to your business, we’ve developed a series of questions to ask yourself. The answers to these questions will help you to make the right decision, knowing it will work for your employees and your business.

To select the most efficient vehicle program for your business, you’ll need to answer the following six questions:

1. Do you have the capital to purchase or lease vehicles for your mobile workforce?

If the answer is yes, you can afford to administer company-owned vehicles to all of your mobile employees, then a fleet program is a viable option for your business. If the answer is no, perhaps because you’re running a small business with limited capital or your mobile workforce is too large to support, a reimbursement program would be the better option. In this case, a tax-free Fixed and Variable Rate (FAVR) program can help you to ensure cost efficiency.

2. Can your business assume the risk for vehicle liabilities?

If your business can assume the risk for any potential accident at any time (beyond standard business hours), a fleet program would be an available option. If your business wouldn’t be able to take this risk, a reimbursement program would allow you to avoid total liability and instead only assume the risk when vehicles are being used for business purposes.

3. Do you have the administrative resources available to support your program?

If you have the resources to manage corporate vehicles, a fleet program would still be suitable. If your business doesn’t have the overhead for managing this, consider a reimbursement program with automated mileage capture systems that include a simplified submission and payment processes.

4. Does your company require specialty vehicles?

If your company requires the use of a particular sized truck to deliver product or inventory, for example, you’ll want to select a fleet program. For these types of businesses, purchasing specialty vehicles will ensure requirements are met, and also give you the ability to incorporate your branding onto the vehicle. If your company doesn’t have these requirements, a reimbursement program where an employee can choose to drive any type, make, or model vehicle provides flexibility to the employee.

5. Are your mobile employees on the road every day?

If your employees are driving more than 5,000 business miles per year, a fleet or FAVR reimbursement program will allow you to best support their needs. Alternatively, if your employees don’t require a vehicle every day, think about implementing a cents-per-mile reimbursement program where employees can get paid tax-free.

6. How sizable is your mobile workforce?

If your current mobile headcount is high, you can create efficiencies by having a fleet program. That being said, if you have a smaller mobile workforce, a reimbursement program will be more cost-effective for your business. A FAVR program is also a potential option, but keep in mind that they require you have at least five employees for you to qualify for tax-free reimbursements.

Next steps

Using your answers to these six questions, you’ll be better positioned to make the right decision when selecting your business vehicle program. Ultimately, if you consider the unique needs of your employees and of your business, you’ll be on the path to successfully managing a mobile workforce.

Find the right program for your business

The Author

Courtney Steinkrauss

Courtney Steinkrauss is Manager of Demand Generation at Motus, LLC. She's focused on helping connect businesses and their mobile workers to the tools they need to stay productive, safe and successful.

Read more by Courtney Steinkrauss

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