Using best practice is something we could all do better. But particularly, it seems, when it comes to being a small business and running business cars efficiently.
Even though a scary one in every 56 businesses will cease trading this year – an increase of 59% according to accountants and business advisors, BDO Stoy Hayward LLP – small businesses appear less inclined to follow some of the best practice from larger enterprises.
The leasing company Arval has researched the small business market place and discovered that small companies are less likely to seek help to manage down their company car costs.
And while larger companies favour contract hire as a means of providing company cars, most small businesses are still wedded to the idea of ownership. And some 33% don’t even have a company car policy.
Now, while I’m a great believer in having and financing the cars that suit your business, I believe strongly that not all small businesses are aware of the alternative funding methods out there available to them.
For example, a canny small business might be quite happy purchasing used cars because: a) they save on the depreciation; b) it provides them with an opportunity to have a smarter car than they could afford new. For example, my landlord, Peter Edney, runs his own small accountancy practice, but purchases used Mercedes. His latest is a very smart 11-year-old SL V8.
But I bet many small businesses aren’t alive to the fact that ownership of new cars ties up capital that could be more readily used in the business – especially now, when cash flows are so tight.
On the other hand, leasing a car – whether through contract hire or personal contract hire – gives you access to a brand new car for a fixed monthly sum, while keeping other lines of credit (bank loan, overdraft and so on) open for purely business use. At the end of the two-, three- or four-year term, the car is returned. And a new lease on a new car started. Small businesses should talk to their local dealer business sales or a BVRLA approved contract hire company for more on the benefits of leasing.
The forgetful zone
While we’re on the subject of research, I came across this from Continental Tyres: on average a third of most people’s journey will be zoned out. In other words, unaware or inattentive of the actual traffic conditions around them.
The research found the average driver is on the road for 45 minutes a day and that they are in their own little world for 17 minutes of this time. They make an average of three trips in their car each day. They are distracted at least three times on each journey and for at least four seconds each time. At just 40 mph a car will travel over 18 metres every second.
I spoke to Continental’s Guy Frobisher about the results. “Our fast-paced lives can mean little time to fit everything in, but driving is no time for multi-tasking,” Guy explained. “Our advice is to avoid distractions like eating or drinking or making a phone call, even if hands-free. You could prevent an accident.”
I couldn’t agree more.
For the record, here are the most common driver distractions. But the one that scares me the most is number 11. If your small business doesn’t have a company car policy – particularly for mobile phone use – then now is probably the time you should.
TOP 20 DRIVING DISTRACTIONS
1. Re-tuning the radio/inserting a CD into the player
2. Talking to a passenger
3. Looking at scenery
4. Eating
5. Listening to loud music
6. Reaching into the glovebox
7. Looking at houses
8. Drinking
9. Other drivers in cars next to you
10. Passengers asking questions
11. Texting
12. Trying to unwrap a sweet
13. Talking on the mobile phone
14. Looking at a hot girl/bloke
15. Shop windows
16. Kids in the back seat shouting, or playing up
17. Trying to read a map
18. SATNAV
19. Looking at billboards
20. Singing
Ralph Morton – Editor of www.BusinessCarManager.co.uk
Business Car Manager is a business motoring website dedicated to small businesses. You can access it for free by logging on to www.BusinessCarManager.co.uk.
