Technology

GPS Tracking Systems: The Ultimate Management Tool of the Limousine Business

Jim Luff
Posted on October 1, 2008

During the past five years there has been a steady increase of GPS vendors targeting the limousine industry.

Many people, however, confuse various types of GPS devices. GPS is without a doubt the most innovative management tool the industry has seen since the advent of reservations software. There are two basic types of systems that use GPS:

1) Navigation systems such as TomToms, Garmins, and Magellans that guide you to your destination using turn-by-turn voice instructions backed by a digital map with arrows.

2) Fleet management systems, also known as tracking systems, such as Discrete Wireless, Teletrac, and Enterprise GPS.

This article focuses only on fleet management tracking systems, although many tracking systems also have the ability to send navigational directions via a cell phone or mobile data terminal (MDT), thereby doubling as a navigation system.

Some GPS companies clearly have tailored their product and sales efforts to the industry with Teletrac, integrating their product with the popular Fasttrak Livery Software.

Enterprise GPS has invested in the industry by attending and sponsoring trade shows and state association meetings.

Discrete Wireless has garnered a significant base of installed systems primarily because their reports and functions seem to cater to the limousine industry.

For those who worry about invading your employee’s privacy, just remember it is your vehicle you are tracking and the employee is being paid by you, and you have a right as much as an obligation to supervise the work of your staff. The issue was tested before the Oregon Supreme Court who ruled employers have a right to use GPS (Oregon v. Meredith, OR Supreme Court No. SC50173, 2004).

How Much Will It Cost?

GPS TRACKING SYSTEMS begin as low as $15 a month but average about $30 to $40 per month for “monitoring fees” for each tracking unit you have.

This does not include the price of equipment. While $40 may seem like a lot of money, if you have 10 vehicles, when looked at as a per-vehicle monthly expense, the unit may pay for itself within a period of one month just through the reduction of payroll expense as the unit serves as your new time clock. It will reduce your fuel costs by eliminating unauthorized detours and personal errands, and excessive idling.

It will reduce the consumption of fuel as chauffeurs know you will be notified every time they speed, which burns more gas. The actual cost of the equipment ranges from the price of a Nextel phone at $150 to top-of-the-line MDT models at $800. The Nextel phones can be used along with software by @Road that allows you to send a query signal to the phone, in effect asking, “Where are you?”, also known as “pinging.”

The phone’s location is displayed on a website. This would be considered an entry-level system. Even in the medium price range, system functions include unlocking the doors on a vehicle remotely or disabling the engine from starting if you need to.

Potential engine problems are reported using the onboard diagnostics (OBD) computer system installed by vehicle manufacturers.

Vehicle Management Tool

BEFORE YOU CAN really shop for equipment, you must know the many bells and whistles. Like livery software, more expensive systems offer more capabilities, more reports, more alerts, and more control than lower-cost systems.

Of course, the most obvious function is the ability to see where each of your cars is located. This is accomplished by pinging the vehicle and getting a report back indicating various conditions about the vehicle, including the current location within a five- to 50-foot range, depending on the system.

It can tell you if the car is on or off, direction of travel, and current speed. Tracking systems automatically ping vehicles on a basis that can range from every one minute to every five minutes, and on demand. Some GPS companies charge extra for this, and others give you a certain amount of “on demand” pings per month before charging for extra pings.

Using “alerts,” the tracking system can send a text or voice message to your cell phone that the vehicle is traveling faster than a speed you specify.

If you don’t want to be bothered in off hours, you can set it up to send you an e-mail report with the date, time, and location of the speeding car to address the issue with the chauffeur later.

The more reports and alerts a system has, the better tool it becomes for management. Reports also include a detailed history of where the vehicle has been and when it was there. The ability to archive these reports ranges from system to system, but most can be printed in PDF format and be imported into Excel. If you have an excessive idling policy, you can enforce it and drastically reduce your fuel bill.

If the tracking system has vehicle maintenance capability, alerts can be set after a certain number of miles are traveled to remind you of oil changes, tire rotations, and other maintenance issues that must be performed.

If the vehicle OBD senses a mechanical or electrical problem, an alert with the vehicle’s diagnostic code can be sent to a cell phone or e-mail address so the problem can be corrected immediately.

Payroll & Billing Matters

FOR COMPANIES THAT pay by the job, there is no more accurate measure of how long it took to get the job done. For those who pay hourly, there are no more personal errands or claims that a trip took longer than expected due to an accident or road closure.

These situations cause excessive and unearned payroll expense, needlessly costing you money. The vehicle becomes a virtual indisputable time clock. If a client complains his vehicle was late and the chauffeur denies it, you have a comprehensive method to determine the correct billable amount based on real time.

Setting Boundaries

QUITE LITERALLY, YOU can set boundaries by creating “geo fences” by marking an area where the vehicle is allowed to be on a map. If this vehicle leaves this pre-defined area, you can get a text/voice message sent to your phone or an e-mail report. You can even specify at what time a vehicle should next have the engine started and be notified if it happens any sooner than planned.

Which System Is Right For Me?

THE BIGGEST CONCERN for acquiring almost all new equipment is the cost. The size of your fleet and expected growth over the next five years will influence your decision. If you have a small fleet, maintenance alerts might not be as important to you because maintenance schedules are easily managed.

You also may only wish to track the location of your vehicles because payroll is easier to track when you have less than three or four cars. Larger fleets become more difficult to keep up for both maintenance and payroll issues, so the alerting function would be an important feature for a medium-size operator to consider.

Integration with existing software can be beneficial, but you also must consider whether you will be changing software in the next five years. Most GPS companies offer leasing or work with a third-party lease company to facilitate the sale of the equipment. Leasing provides a financial benefit because the entire monthly payment is considered a business expense and can be written off as such.

You also may want to consider an equipment loan from your bank that may reduce the overall cost of the acquisition but does not provide the tax benefit except for depreciation of the equipment. The cost of the monthly monitoring fee should be carefully examined to determine exactly what the expectations are for service. This often includes when regular pings occur, and the costs, if any, for additional pings, and if there are any other charges such as roaming charges if your vehicle is out of the cellular coverage area of the GPS company.

As this expense is ongoing as long as you use the system, you need to make sure the product will meet your expectations for a fl at monthly fee. The cost of the equipment for each vehicle is a one-time expense.

To determine how it will pay for itself, you can estimate the savings before you purchase. Call your insurance company and ask how much your annual premium will decrease for having a tracking system. Many insurance companies will reduce annual premiums by up to 15%, says R. Wayne Johnson, vice president of sales and marketing of Discrete Wireless, an eight-year-old company with more than 4,900 customers.

This savings alone may pay for the initial cost. You also can take your total monthly fuel cost and reduce it by 10% according to the claims of most GPS company websites. You will quickly see how fast these units will pay for themselves without even considering the reduction of payroll expenses once installed.

[SIDEBAR]

Improving Client Service

A LAST-MINUTE booking or car breakdown makes the need to know the location of the closest vehicle that can help as quickly as possible. GPS makes it easy to see where all your vehicles are at once, thus choosing the closest available vehicle. If a vehicle will be late, you can see it before it happens and call the client or dispatch a closer vehicle and swap trips if needed.

Enterprise GPS offers the ability to assign temporary access to your clients so a client can track their own vehicle. This can be a selling benefit for your company as corporate managers track the progress of their employees’ trips in your vehicles.

Teletrac has integrated its product to work with Fasttrak software by reporting and exchanging information with the popular reservations and dispatching software system.

When a vehicle arrives on location, Fasttrak software is automatically updated to reflect the vehicle’s arrival and providing an exact time stamp for billing purposes.

Because clients of Fasttrak users already can access their own reservations online, they also can check the physical status of their vehicles when the two systems are used together.

[END SIDEBAR]

Related Topics: Enterprise GPS, FASTTRAK, fleet tracking, GPS Navigation, onboard diagnostics, vehicle diagnostic technology

Jim Luff Contributing Editor
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