The benefits of a fuel card for taxi drivers
It’s no secret that saving costs on fuel is a core goal for virtually all commercial fleets, but did you know that taxi fleets in particular could be missing out on huge savings?
That’s the idea we’ll explain to you in this article, as we look at how taxi drivers operate, and which specific benefits of a fuel card can enhance taxi businesses.
Taxi fleets and fuel consumption
When compared to your typical fleet of HGVs making long-distance deliveries, a taxi fleet is likely to consume a considerable amount of fuel while the vehicles are actually stationary. With every minute a taxi driver spends waiting for customers to enter and exit the vehicle safely, precious fuel is burnt to keep the engine running, and this is commonplace for the majority of taxis operating on UK roads today.
While stop-start technology could diminish this issue slightly, digital apps such as Uber are effective at letting customers know that drivers have arrived – and so drivers similarly know that they aren’t likely to be kept waiting for long before customers hop into their vehicles. Consequently, there may not seem to be much of a point in turning off the engine at all.
The greatest concentration of taxis is found in densely populated city areas, and with taxi fleets typically looking to make frequent, short journeys and keep occupancy high- there’s a constant demand to fill up. So, broadly speaking, taxis consume an enormous amount of fuel when compared to your average commercial fleet – and so operators must ask themselves ‘how can the cost of fuel be properly offset or reduced?’
How to tackle fuel costs
When fuel costs are high, one instinct many business owners have is to increase the price of each journey. By having the customers pay a slightly higher fare, profits can be protected – and this philosophy works for many businesses. Particularly in cities or areas whereby many quality taxi ranks are operating, however, the competitive landscape needs to be taken into account.
If your competition is offering a reliable service while undercutting your price, they may be making slightly smaller profits on each individual taxi ride, while generating substantially more sales overall. When both yourself and your competitors acknowledge this, the commercial taxi market will often reach an equilibrium whereby different providers are coming in at fairly similar price points.
Finding a competitive edge
In these established markets, it’s vital that any opportunity to improve profitability is seized, and one of the best ways of achieving this is actually tackling your costs head on with a fuel card. Fuel cards essentially provide you with a discount on each litre of fuel you purchase, which often racks up incredibly quickly for taxi fleets.
They’re also particularly useful given that taxi fleets often repeat the same routes, and operate within a fixed area. Naturally, if you’re aware of which fuel providers operate at your local garages, which our handy Pump Locator service can help you with, then you may find yourself in a position where you can purchase a fuel card that specifically benefits you based on that nearby petrol stations data.
Tips on applying for a fuel card
If the picture we’re painting around taxi drivers’ challenges, operations, and the opportunity to save money on fuel, rings true to you- then you may be ready to start exploring the world of fuel cards and finding the card that best suits your drivers.
We have built a fuel card selector tool to help guide you through this very process, however it’s worth considering:
- What coverage you’ll need. Some fuel cards offer nationwide coverage, whereas others are locked to specific regions. You may find that the perk of national coverage isn’t actually beneficial to your local taxi business, and consequently consider putting more weight into considering other benefits when choosing between cards.
- Payment terms and credit options. Some fuel card providers offer an attractive range of payment perks, such as terms around advance payments, or even their own downloadable apps that can help you authorise fuel payments quickly.
- Transaction fees. Certain fuel stations will require that you pay a transaction fee upon making a purchase, which can add up if you’re making regular visits. That isn’t the case with all fuel cards, though, such as Texaco Fastfuel, and so taking the time to review your options carefully could result in great savings across the board.
Ultimately, understanding the total amount of distance your drivers are covering on a daily, weekly, and monthly basis, then reconciling that data with the types of savings you could be making with a fuel card, is a great place to start for commercial taxi fleets. It could result in you edging out over your competitors with a more financially viable, long-term fuel strategy – and there are a million things you could do with your savings to drive your business forward; from marketing to investing in new equipment and people.
How can Fuel Card Services help?
At Fuel Card Services, we help UK businesses save money on their fuel costs every day. We’re the UK’s largest fuel card provider, so whether you’re running a commercial taxi fleet or operate around delivering goods, we’re confident that our experts can help you find a fuel card solution that works for your business. Why not get in touch to find out how we can support you?
Of course, implementing a thorough strategy to minimise costs and maximise the efficiency of your fleet goes way beyond using a fuel card. While it’s an excellent starting point, we’d also recommend browsing our range of professional fleet services which are designed to make it easier for you, as an operator, to manage and overcome the day-to-day challenges you’re likely to face.back