All businesses, no matter the industry, have one thing in common, and this is the desire to keep operating costs to a bare minimum. For most businesses, anything that affects the bottom line has to be kept tabs on, controlled, and kept to the bare minimum. While that is easier said than done, sometimes making savings can be pretty straightforward. At other times, however, you don’t have much of a choice, for instance, when it comes to paying taxes.
Fortunately, fueling your company vehicles presents you with an excellent opportunity to save on transport costs. With a fuelcard, you get lower rates than the pump price, as well as enjoy other benefits. In this article, we look at how UK fuels cards work and how to use them and save money.
In a perfect world, drivers would want to know where they can find fuel at the cheapest rates anywhere across the country. You would also want to purchase this fuel at a discount. You would also want to delay the payment a bit, with credit that doesn’t attract interest.
Talk to any driver, and they will wonder if you haven’t heard of a fuelcard. Most businesses that rely on fleets of cars for their operations have discovered the secret and have long switched to UK fuels cards. The above scenarios are just some of the benefits enjoyed by these firms. What’s more, qualifying for them is incredibly easy. If your budget for petrol or diesel is above £500 per month, and you also have a good credit score, you are eligible for a fuel card. But the big question is, how do fuel cards save businesses money?
How Do Fuel Cards Work?
You first need to apply for a fuel card, where you request enough cards for all the fleet drivers you have. Each fuel will include a guide showing where the card is valid. Once you receive your cards, you will be notified every week by your supplier of fixed national costs for the upcoming week. UK fuels card prices are typically 2p, or 3p lowers than pump prices. This could mean a saving of as much as 10p per litre compared to motorway prices. By this time, you should have already supplied a fax or email where notifications will be sent.
Your driver needing to refuel consults the guide quickly to see the nearest station. They will then fuel normally but present their card when the time for payment comes. That’s all. Each week, you receive one invoice for all the vehicles. You can automatically pay for this by direct debit, and you have up to two weeks of free credit.
Why Fuel Cards?
The most immediate benefit of fuel cards is lower petrol and diesel bills, but businesses can also enjoy savings from reduced administration. That’s because you only have one invoice to manage and not piles of receipts. Even more importantly, you can be in control of your fuel costs and can monitor them better. And thanks to heightened security features, no unauthorized persons can use the cards to purchase fuel. Since the card is set to be used by the driver only, it is useless even if it lands in the hands of a thief.
How to choose a fuel card
First, you need to calculate the amount of money you are spending on fuel. The person to tell you this is the one charged with reconciling those heaps of garage receipts. It contains many small bills, making it easy for the cost of fuel to be hidden among the overall expenditures. Because it is rarely reported as a single item, most companies do not realize that they spend more than they think. Thus, anyone who spends several hundreds of pounds a month will benefit from signing up for a fuel card program.
But the challenge for most businesses is finding the right UK fuels card that meets their specific needs. If you talk to a fuel card provider that only has one kind of fuelcard, they will try to convince you that they have the solution you are looking for, without regard to your circumstances. But no one fuel card can be the solution for everyone. The problem is that many people mistake fuel cards for discount cards. To some extent, this is right as they start and end with lower-priced fuel. However, fuel cards are different. Some don’t give any discounts at all.
If your drivers largely operate locally, you will not want to choose a fuelcard network focusing on motorway refuelling. It suits a business that has vehicles going up and down the highways. So, before you choose a fuel card provider, consider the type of vehicles you have and whether they use diesel or petrol. Cost savings you make at the pump are the main perks of a fuel card, but you should not stop there. Consider also other things that a driver may require, for example, lubricants. Some cards incorporate these, while others do not. Do not assume anything, and make sure you ask the right questions.
Direct invoicing for fuel, as opposed to having drivers pay with their cash, and then you refunding them, is a major benefit that may not be obvious. The significance of this will be seen when reclaiming VAT. Get the right card and enjoy quick, simple, and assured administration. If not, be ready to face fierce bureaucracy that wastes time and money.
A good fuel card not only saves you money but also reduces management time. But expect your fuel management headaches to continue if you cannot properly keep track of your spending. Does your program allow you to access accurate details of your card in real-time? This should include the latest transactions on your favourite device.
If not, you may want to move on to the next supplier. Whichever card you choose, it is important to find someone to talk to. To that end, you need to ensure that the card program has a physical location with an attendant on call at all times. This way, you will not be calling an anonymous call centre.