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- Total Cost of Ownership Tools
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The Challenge
A roofing company had a history of purchasing their fleet vehicles, which are primarily work trucks and cargo vans, out-of-stock. While they began transitioning to factory ordering, they had concerns about long production timelines in the face of fluctuating deadlines. They also were paying a premium for out-of-stock ordering.
The Solution
Merchants proposed setting up a bailment pool to mitigate their concerns about OEM ordering deadlines and production timelines. By having some vehicles available in a bailment pool, the company could be confident that vehicles would be available when needed.
The Results
The company plans to keep 3-5 vehicles in their bailment pool so they have the vehicles they need as they continue to transition to more factory ordering. It is projected they will save approximately $2,000 per each vehicle that is factory-ordered instead of ordered out-of-stock. With around 150 vehicles slated for replacement this year, they are anticipating approximately $300,000 in savings.
