By John Ellis, Nexus Vehicle Rental’s Managing Director
Figures recently published by The Society of Motor Manufacturers and Traders (SMMT) have shown the number of company car drivers is growing. Mobile employees are choosing to swap privately owned vehicles for newer company cars through either traditional schemes or a salary sacrifice arrangement. For employees, the company car is an attractive component of a rewards package. For businesses however, company car schemes are often the second highest expenditure after pensions.
This doesn’t have to be the case and an increasing number of leading companies are turning to vehicle rental as an economically viable alternative. In the short term it avoids the major upfront capital investment necessary to fund a fleet of company cars. And in the long term, brand new rental vehicles are more fuel-efficient and have lower CO2 emissions. Plus, new cars lose up to 20 per cent of their value the moment they’re driven off the forecourt – can you afford an investment with this kind of resale value?
Through leasing and renting company car needs, fleet becomes a manageable, monthly operating expense keeping credit lines clear and allowing cash to be reinvested into the core of the business supporting growth. However, longer term daily rental, unlike leasing, doesn’t require upfront payments and is far more flexible; there are no long term commitments or maintenance costs as these will all be covered by the rental company.
When it comes to corporate renting, it is important to remember this is not the same as your one-off holiday or leisure rental. Options are vast and there are savings to be made in all aspects of the process. That’s why many of our customers choose to outsource their rental needs to an expert in the market. This not only reduces administration time, but it also ensures all rental needs are understood and met with optimum efficiency.
Things to consider when choosing your rental partner:
- How long have they been in the market?
A company that has a long history means it will have developed strong supplier relationships. This will allow vehicle procurement at the best terms helping you to become more efficient and profitable.
- Are they specialists in rental software?
An important part of navigating the modern rental market is having the latest technology which streamlines the rental process and increases efficiency. Nexus’ custom built Intelligent Rental Information System (IRIS) is one option which manages the entire supply chain and makes any vehicle readily available.
- Do they have specialist expertise?
A rental partner shouldn’t be seen in the same way as an in-house rental department. It should be adding real value to your business by optimising processes and cutting costs through expert knowledge and the leveraging of strategic relationships.
- Are they a specialist, business-to-business only rental company?
This is an important consideration as many rental companies have stop sell periods when they divert their fleets for use by leisure customers. As a corporate client you will want to have guarantees of all year round availability across the country, which only specialist B2B rental operators will be able to provide.
The company car is an attractive component for employees, but it can also be a rewarding facet of your business that delivers real return on investment. The right rental partner can enhance your service offering and reduce your overheads by combining expert consultancy with advanced technology. But importantly, rental offers peace of mind as all the intricacies of fleet management – vehicle maintenance, driving license checks, legal considerations etc. – can be taken care of by an expert.