Choosing the Wrong Vehicle Program Vendor: The Downsides of a Bad Decision
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Choosing the Wrong Vehicle Program Vendor: The Downsides of a Bad Decision

By Ben Reiland July 28, 2022

Categories: Anywhere Workforce Vehicle Reimbursement

We live in a world of options. With those options comes the possibility of making mistakes. No one wants to choose wrong. And there are steps we all take to make sure we don’t make the wrong choice. A large part of that is putting in the research, exploring every option. But making a bad decision can still happen. Sometimes, the results are manageable. Other times, it’s utter disaster. Here we’ll walk through what can happen when a company chooses the wrong vehicle program vendor.  

Price of a Program 

For many company executives, price is a large factor in the decision-making process. If the product looks good and the price is lower than that of competitors, it might seem like the perfect fit. Unfortunately, once the contract is signed, prices change. Additional services understood to be included in the original price now come with an additional fee. Vendors may have other hidden costs as well.  

The right vendor will present this information accurately, spelling out what is included with the customer’s contract. They will also be up front about which add-ons require an additional charge. 

Getting on the Program 

For a number of reasons, implementation can be a challenge for companies. Change management is a large hurdle to overcome. The right vendor will ensure the process is clear, will walk the company through it and provide additional information and help as needed. Unfortunately, unqualified hands can greatly impact this transition. 

The wrong vehicle program vendor may lack the message, process and turnkey templates necessary for the process to go smoothly. Administrators and driving employees alike will have questions and concerns. An implementation team that cannot answer these questions and provide supporting materials will set the vehicle program up for a rocky start.

Change management and rollout are specialized skills. Teams that juggle day-to-day account management duties along with program rollouts cannot measure up to focused professionals with a single role. It’s one thing to have the company on a vehicle program. It’s another thing to have all drivers and administrators comfortably transition onto a new vehicle program with their questions answered and supporting materials to help them.  

Administrative Burden 

Companies selecting a vehicle program vendor might be exploring cost savings opportunities or efficiency benefits. Whether it’s their first program or they’re moving on from another vendor, it can be easy to overlook the administrative workload of a vehicle program. Administrators approve mileage logs, pull reports, add and remove drivers and more. The right vendor will remove that burden from employees and help administrators in their review process. 

On the other hand, the wrong vendor might not have the platform or the depth of offering. That gap will lead to more work from both vendors and administrators. When employees spend more time with administrative tasks, they’re spending less time on their work, making the solution more costly for the company. This burden can also lead to frustrations and higher rates of turnover, distracting companies from achieving their goals. 

Reliable Mileage Capture 

The right vehicle program vendor provides a product that meets the needs of the customer. Namely, a reliable mileage capture app. A mobile worker could be doing everything right, but that doesn’t guarantee an unreliable app will capture the mileage of a trip. When a mileage capture app doesn’t function as intended, the results are a serious challenge impacting both the company and the mobile worker.  

Driving employees have traveled miles without an accurate record of their trips. That ultimately makes reimbursing the driver accurately impossible. This may result in a non-compliant mileage log or a taxable reimbursement. The company now has an unhappy mobile worker, an issue that will likely occur with more than one driving employee, and no immediate solution. 

Reimbursement Processing 

Reimbursing with the right vendor is easy. However, the process requires several steps. A failure in any of them can present a serious problem. Even if a vendor’s mileage capture app is functioning accurately 100% of the time, they may still have difficulty processing reimbursement payments. 

When implementing a vehicle program, companies want to know the vendor will provide employees with the proper reimbursement in a timely manner. If the reimbursement process breaks down on the vendor side, driving employees go uncompensated for the personal use of their vehicle. When employees don’t receive money they were expecting, they aim their frustrations at the company. Those frustrations can lead very quickly to higher churn rate. Admins will be taken off task to do what they can to resolve the issue. This will also expose the program buyer’s bad decision to their organizational stakeholders.  

IRS and Labor Law Compliance 

Whether it’s an IRS audit or a class-action lawsuit, companies have less to worry about when they’re compliant and following the letter of the law. The right vehicle program provider will go above and beyond, verifying driving employee’s insurance, offering continuous MVR monitoring, ensuring IRS compliant rates and mileage logs and calculating geographically specific reimbursement rates. The gaps the wrong vendor leaves in their process may not adequately mitigate legal risk.  

Without insurance verification and MVR’s, companies may hire driving employees ill-suited to the task. The wrong vehicle program vendor will fail to catch concerning behavior in the company’s mobile workforce. There’s also the issue of data accuracy. The wrong vendor may not have access to the same depth of data when calculating rates. This may result in inaccurate and unfair reimbursements.  

Onboarding and Off-boarding Pains 

Employee churn is difficult to manage in the best of circumstances. Taking someone through the hiring process is a serious investment for the company. When that employee is expected to drive for work, that adds another level of complexity. With the right vendor, onboarding a new member to the company’s vehicle program should pose no issue. But, with the wrong vendor, adding and removing a driver can quickly become a pain. 

There’s a process to adding employees to a vehicle program. If the vendor has trouble with this process, or doesn’t have one nailed down, that increases the admin need from the company. Off-boarding has a similar process, one that can be streamlined for efficiency. If the vendor lacks experience with this process, or if the company has to rely on their vendor to make changes, that can also create additional administrative work for the company. 

Product Expansion 

When a company chooses a vehicle program vendor, they’re looking to solve a problem in their current process. But companies grow, pivot and scale. The right vehicle program vendor can not only shift with the company’s needs, but also support them as change needs. Reimbursement needs can quickly grow from vehicle to device and internet. This expansion isn’t something every vendor can support. 

With the wrong vehicle program vendor, a company’s options to expand are limited. They may be able to add drivers, but supporting additional vehicle programs under one program cannot be done. The company may look to support their additional vehicle reimbursement needs elsewhere, while also juggling other reimbursement needs with additional vendors. Just thinking of handling all these programs and the relationships with each provider is enough to make one’s head reel. 

Selecting the Right Vehicle Program Vendor 

With rising inflation rates and concerns of recession, companies have less room than ever to make a mistake. Choosing the right vehicle program vendor shouldn’t be like hunting for a needle in a haystack.  

Know the needs of your company, look for a solution provider with experience and customers that can speak to it. It’s also important to find a vendor with a robust platform to calculate accurate rates and process reimbursements without issue. Finally, the right vendor should also help your company easily implement a vehicle program that can scale with the economy. 

Interested in learning more about what the right vehicle program vendor can do for your company? Find out in our blog, Selecting the Right Vehicle Program Vendor. 

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