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How small businesses can provide company cars and stay flexible

Smaller businesses rarely have the budget, capacity or need to employ a dedicated fleet manager. Leasing providers can offer a more cost effective option suggests Hitachi

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3 February 2016

How rental can offer small businesses a flexible company car policy

  • Leasing companies don’t just offer contract hire
  • There’s also the option of daily rental – useful for staff without a company car
  • Long term rental – useful for staff on a probationary period
  • Alternative use vehicles – if your firm needs a bigger van, rent it for the period you need it
  • Vehicles can be delivered quickly – so there’s added flexibility
  • Lower cost solutions for small businesses running a company car fleet

SMALLER businesses rarely need a dedicated business car manager.

Usually there’s no capacity in the business for such a luxury.

Rather than take someone away from their core role to manage the company’s vehicles, leasing providers can offer a more cost effective option.

As well as advising on licensing, taxation, duty of care issues and greener choices, leasing specialists can ensure you make the right choice financially.

The monthly contract cost is the first thing that many small businesses look at. But it’s unwise to make a decision based on that number alone.

In the long run, it is worth investing in expert advice on licensing, taxation, duty of care issues and greener driving policies.

But companies should also consider various rental options. These can work alongside longer term contract hire arrangements.

Smaller companies need flexibility. So it’s worth asking your leasing car provider if it can offer you a similar service as it does for its bigger clients. Can they create a flexible company car policy for you?

So what are these service sand what are the options?

The daily rental option

Find out whether you can get access to additional vehicles for short term usage – in case you need them. This reflects the disappearing pool car trend – because they are a capital expense – in favour of short term rental which is off balance sheet.

It also means they don’t have to worry about the hassle of maintaining vehicles. It’s important from a duty of care perspective as well. Rental companies conduct a minimum 80 point safety inspection on all rental vehicles before every hire.

Companies typically use daily rental vehicles for short term projects. For example, when staff that don’t have a company car all the time need to use one to get to a training session or to another office. Another use is if a staffer is on a probationary period – rather than invest in a monthly contract hire rental that may prove unwanted if the staffer doesn’t work out, a daily rental hire car covers that period in a flexible way.

Some of our clients that have low cost cars on a contract hire basis often hire executive cars as required. This generates an impression when they go to important sales pitches or supplier events.

How about long term rental?

This type of rental can be used over a longer period of time – without the client being tied into a three or four year contract.

It’s ideal when a new member of staff joins on a probationary period, but needs a company car for commercial business, or is entitled to one as a perk. The company can provide a vehicle without the commitment of a lease.

Stay flexible on size

A good leasing provider will help you to decide on the most appropriate vehicle and ensure it is cost effective.

For example: you’re a small building contractor who uses a small van for 47 weeks of the year. But you require a larger commercial vehicle for a few odd occasions during the year. In this case it is often cheaper to have a small van on contract hire. And use a daily or long term rental service for the larger vehicle. This provides the same productivity for a lower cost.

Whatever the size of your business, your leasing company should be able to audit your present usage. And come up with the best deal – without compromising on services – that will ease the strain.

And allow you to run your small business – and create a flexible company car policy for your staff.

More useful reading if you run a small business and company cars

Click here to read How to make sure your company cars are legal

Click here to read Creating a company car policy for a small business

Click here for What is daily rental?

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Ralph Morton

Ralph Morton

Ralph Morton is an award-winning journalist and the founder of Business Car Manager (now renamed Business Motoring). Ralph writes extensively about the car and van leasing industry as well as wider fleet and company car issues. A former editor of What Car?, Ralph is a vastly experienced writer and editor and has been writing about the automotive sector for over 35 years.

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