Today, managers of freight and passenger transportation companies are concerned about the rapid growth of expenses on most budget items. The industry is experiencing an acute shortage of drivers, deficit of equipment and spare parts, especially imported ones. It is possible to maintain competitiveness in modern realities only with competent business management.
The economic efficiency of transportation can be defined in different ways, depending on what criteria are used for evaluation. However, in a general sense, the economic efficiency of transport can be defined as the ratio between the costs of transportation of goods or passengers and the revenue received.
The economic efficiency of transportation rests on “three pillars”:
- fuel and lubricant costs
- labor fund
- maintenance and repair of equipment
- fuel and lubricant costs
- labor fund
- maintenance and repair of equipment
The list of cost items also includes: insurance, leasing, taxes, fees, administrative costs. But these items are not so significant for the budget compared to the “whales”. For example, fuel costs can reach 40%, Wages - 20-25%, and MRO - up to 20%. Business owners realize that by reducing costs in key areas, it is possible to seriously save budget, increase fleet efficiency and be competitive. Digitalization of a transport company will help to solve these problems.
Improving transportation efficiency
Fuel and lubricant costs
Fuel consumption control is the most understandable and the most costly item. Vehicles are equipped with fuel level sensors (FLS) and satellite navigation terminals. According to experts, investing in GLONASS monitoring, companies save up to 30% of fuel costs after the first month of using telematic solutions.
Fuel consumption control is the most understandable and the most costly item. Vehicles are equipped with fuel level sensors (FLS) and satellite navigation terminals. According to experts, investing in GLONASS monitoring, companies save up to 30% of fuel costs after the first month of using telematic solutions.
Dmitry Zhuravlev, Managing Partner of MONTRANS Group of Companies: “There are several tips on how to reduce fuel costs. For example, you should minimize the number of transactions and the number of filling stations used. This is achieved by increasing the volume of single refueling and switching to one fuel card operator and one network of filling stations. If the company operates mobile fuel dispensers, they are equipped with a fuel metering system (FMS). This device is one of the latest developments of MONTRANS Group of Companies and represents an automated system of fuel distribution and control. FMS collects, stores and transmits information about the full cycle of fuel movement in the fleet: from issuance from the fuel and lubricants warehouse to refueling of each individual unit of equipment. The fuel controller shows: who is the recipient, how much fuel was ordered, what volume passed through the refueling gun, date, time and geographical coordinates of the refueling place. This solution eliminates the misuse of fuel. For each electronic card a daily limit of fuel and lubricants is prescribed. As a result, the driver will not be able to get more fuel than the norm. As practice has shown, the controller pays for itself in 2-3 months”.
MONTRANS Group of Companies has developed another IT-tool - a cloud service “Fuel Balance”, which makes the movement of fuel and lubricants in the fleet centralized and transparent. Fuel tanks, mobile fuel dispensers and all vehicles are integrated into one digital ecosystem. Monitoring data from fuel dispensers and KUTs are synchronized and integrated into 1C. All this happens online 24/7 and reports are generated electronically. Fleet management of the company sees reliable data on fuel inflow/outflow, as the human factor has been eliminated in the preparation of final reports.
IT solution “Fuel Balance” provides:
- Transparency of fuel and lubricants movement at each stage of movement
- Elimination of fuel losses and underfilling
- Optimization of fuel costs
- Receipt of a single report on fuel and lubricants distribution
- Reduction of time for data processing
- Optimization of financial documents
- Control of fuel and lubricant suppliers and fuel quality
- Transparency of fuel and lubricants movement at each stage of movement
- Elimination of fuel losses and underfilling
- Optimization of fuel costs
- Receipt of a single report on fuel and lubricants distribution
- Reduction of time for data processing
- Optimization of financial documents
- Control of fuel and lubricant suppliers and fuel quality
As a result of implementing the “Fuel Balance” service, fuel and lubricant resources become accounted for and managed. The peculiarity of this innovation is that the economic effect occurs without increasing the staff of controllers, which allows saving significant funds.
Wage costs
Salary is a painful topic for employees, and this cost item should be optimized carefully. The prime rate of drivers may be the same, but the premium coefficients may differ. In this case, it is necessary that the calculation of coefficients be automatic, rational and transparent. So that each employee understands where he has earned and where he has been penalized. For example, the cloud service MONTRANS.ONLINE is not just a GLONASS/GPS transportation monitoring system, but also a tool to control the working functions of drivers. IT-solution tracks driving style (speeding, sudden acceleration and braking), records traffic violations, takes into account insurance payments in case of accidents, controls the work and rest regime of employees. Based on the collected data, the software generates individual driver ratings, which are used to determine additional coefficients to salaries.
MONTRANS DVR intelligent video monitoring system
This IT solution monitors what is happening outside the car cabin and keeps track of the driver's actions. Smart cameras inform the driver about such events as: driving on the oncoming lane, speeding, sharp approach to the object in front, appearance of a pedestrian ahead. The system also warns the driver against smoking while driving and talking on the phone. Electronics will react when a person closes his eyes or starts yawning. Event reports are sent to the dispatcher and stored in a cloud service to resolve disputes. MONTRANS DVR data is also used for driver ratings. Bonus coefficients are derived on the basis of these reports. Thus, modern services help to form a payroll, taking into account the actual amount of work done, excluding the principle of “equalization”.
MRO costs
According to the Ministry of Transportation of the Russian Federation, more than 12% of vehicles in the country's commercial logistics industry are over 20 years old. Every third vehicle is more than 11 years old. Not all ATP owners can afford to lease vehicles, so a significant share of the company's budget is spent on repairs and maintenance. But even this item of expenditure can be saved by reducing MRO costs.
Telematics collects statistics on the mileage of machinery, motor hours, the amount of time under load. On the basis of GLONASS monitoring data, specialists of the maintenance department set markers - after how many kilometers of mileage or after what time of operation it is necessary to carry out maintenance of a particular unit of equipment. Timely maintenance with a budget of, for example, 50 thousand rubles, in the future will save the fleet owner a million, which would have had to spend on the restoration of the machine.
Russian programmers have developed an innovative control and management system for owners of transportation companies - MONTRANS.ANALYTICS. This service complements existing monitoring systems and brings it to the top management level. Analytical data are provided in the form of final reports. They are accurate, reliable, correct and valid. General decisions can be made on their basis. Cloud service allows you to control the technical condition of special machines and vehicles, taking into account climatic conditions of operation. For example, one maintenance of special equipment in the North can cost hundreds, and even millions of rubles. And if maintenance is carried out more often than it is necessary, it will cost the company serious sums for a year. To avoid unnecessary operating costs, it is necessary to obtain accurate information about the operation of machines and plan maintenance based on the actual mileage and hours worked.
Telematics collects statistics on the mileage of machinery, motor hours, the amount of time under load. On the basis of GLONASS monitoring data, specialists of the maintenance department set markers - after how many kilometers of mileage or after what time of operation it is necessary to carry out maintenance of a particular unit of equipment. Timely maintenance with a budget of, for example, 50 thousand rubles, in the future will save the fleet owner a million, which would have had to spend on the restoration of the machine.
Russian programmers have developed an innovative control and management system for owners of transportation companies - MONTRANS.ANALYTICS. This service complements existing monitoring systems and brings it to the top management level. Analytical data are provided in the form of final reports. They are accurate, reliable, correct and valid. General decisions can be made on their basis. Cloud service allows you to control the technical condition of special machines and vehicles, taking into account climatic conditions of operation. For example, one maintenance of special equipment in the North can cost hundreds, and even millions of rubles. And if maintenance is carried out more often than it is necessary, it will cost the company serious sums for a year. To avoid unnecessary operating costs, it is necessary to obtain accurate information about the operation of machines and plan maintenance based on the actual mileage and hours worked.
The MONTRANS.ANALYTICS platform has a built-in “Safe Driving” module, which also influences the number and cost of repairs. According to traffic police statistics, 93% of accidents are the fault of drivers. Cloud service with the help of telematics monitors the condition of the driver and his driving style. For example, MONTRANS DVR system minimizes the number of accidents by 80%. This allows vehicles to remain in service, saving on spare parts and mechanics' work. For example, in 2021, MIP-Stroy No. 1, a company involved in the construction of the Moscow metro, implemented the MONTRANS.ANALYTICS solution, which includes four modules, into its management system:
- Analytics of efficient machinery operation
- Fuel balance
- Maintenance and Repair
- Safe driving
- Analytics of efficient machinery operation
- Fuel balance
- Maintenance and Repair
- Safe driving
Anton Kozlov, head of the mechanized works department of MIP-Stroy No. 1: “After launching the MONTRANS.ANALYTICS program, fuel savings amounted to 30%, which is 27 million rubles a year. The efficiency of machinery operation increased to 40%. Repair and maintenance costs have been reduced by a third, and the service interval has increased by 30%”.
The analytical consulting agency Gartner estimates that by the end of 2023, the share of transportation in the IoT market will reach 39%. Fleets that will ignore digitalization will increase their costs by 25%. This means they will stop developing and being competitive. Today, running a medium-sized (50-100 units) or large (over 100 units) fleet without digitalization means operating at a loss. Practice shows that investments in transportation monitoring systems and analytics pay off in 3-6 months.
Some of the main factors that can affect the economic efficiency of transportation include:
- Cost of infrastructure: the cost of building and maintaining roads, bridges, tunnels, railroad tracks, airports, ports, and other infrastructure can significantly affect the cost-effectiveness of transportation.
- Cost of fuel: the cost of fuel is a major expense for transportation companies. The price of fuel can significantly affect the economic efficiency of transportation.
- Vehicle efficiency: the use of more efficient vehicles can help reduce fuel costs and increase the amount of freight or passengers that can be transported per unit of time.
- Vehicle occupancy: the more freight or passengers that can be carried in a single vehicle, the greater the economic efficiency.
- Travel time: the time required to transport goods or passengers can also have a significant impact on the economic efficiency of transportation. In some cases, faster delivery can justify higher transportation costs.
- Safety: the safety of transportation of goods and passengers is an important factor that can have an impact on the economic efficiency of transportation. If transportation is not safe, it can lead to losses due to damage to goods or injuries to passengers.
- The degree of congestion of vehicles