Logistics provider United Worldwide Logistics Ltd (UWL) has reported significant cost savings and improved cashflow after teaming up with Northgate Vehicle Hire.
Northgate Vehicle Hire has been helping the South Wales-based company to identify and meet its fleet requirements on a week-by-week basis since July 2013, improving cashflow by £10,000 and saving UWL a further £10,000 per year on service and maintenance costs.
With a network of 360 UK and worldwide partners and an ambition to expand the business in the coming year, UWL considered how best to put the business in a position for growth.
It previously contract hired its fleet of light commercial vehicles, where the company’s high mileage requirement became a costly issue.
This arrangement resulted in vehicle downtime costs of £500-£1,000 per day, and in some instances the company was left without a vehicle for up to three weeks.
The nature of the contract led UWL to consider alternative options.
Since switching to a non-contractual flexible rental partnership with Northgate, UWL has made significant financial gains by completely removing the issue of downtime, thanks to being able to add vehicles to its fleet at any time.
With no ties or commitments, the customer simply hands back the vehicles when they no longer require them. This change instantly improved cash flow by £10,000.
Furthermore, service and maintenance costs have been reduced by a further £10,000 per year, enabling the company to consider investment in its site and facilities.
Previously, contracted vehicles were kept for four years, but UWL’s high-mileage requirement means that its fleet is renewed every 18 months under Northgate’s policy.
Brian Young, operations manager at United Worldwide Logistics, said: “Our partnership with Northgate has completely changed the dynamics of our fleet operations.
“Flexible vehicle hire has allowed us to adjust our fleet in order for us to meet demand.”