Tag Archives: fleet management business model

How To Start a Vehicle Tracking and Fleet Management Business

A Vehicle tracking system is the main feature of any fleet management business.  An efficient tracking system helps to reduce operational and maintenance costs. Real time vehicle tracking results in better time management and superior customer service.

All fleet management requires a GPS tracking system for their vehicles to run their business efficiently and profitably.  Hence starting a vehicle tracking business is a lucrative option.

Read Also: What is fleet management – All you need to know

Like in any business, there are various factors to be considered and steps to be taken if success is to be achieved. It is imperative to focus on key objectives.

1. Customer Segment

As there are different kinds of fleets and vehicle tracking systems, it would be advisable to first identify the potential customers for whom the service would be provided.


Every fleet operator would require a system. But it would be ideal to concentrate on a single segment rather than providing all sorts of services for all. This will enable one to focus on any one single customer segment and develop a system required for them.

A study of the competitors in the market, the product, their market segment size, sales efficiency and pricing would help in establishing a niche market for your product. This study will help in offering features not catered by them.

Knowing what you are going to sell and to whom makes it easier, the identification of a specific market will increase the efficiency and the business will prove successful in the long run. A successful business can be easily branched out anytime in the future.

2. Identify The Product

The core functions of the business and the customer’s expectations are to be studied.  The right vehicle tracking system, appropriate to meet the needs of the target customer, has to be developed.

The tracking company has to choose the best technology as this choice reflects directly on customer satisfaction.  Developing a new technology will be time-consuming. In new business, it is always better to outsource the services. This will be easy to implement and cost-effective.

The vehicle tracking business has to provide a focused and attractive offer to the fleet operator. An ideal offer would be a detailed, unambiguous plan stating whether the company will install the tracking units, do the GPS monitoring and manage the fleet. The charges and subsequent payments have to be listed clearly.

A fleet management business requires special features that improve its operations and reduces costs. The vehicle tracking system has to concentrate on the factors of real-time tracking of vehicles, optimization of routes and allocation of resources.

Automated notification of tasks, proof of delivery, rating and feedback are features that reduce customer complaints and increase customer satisfaction.

3. Software Selection

The tracking device will have a software and hardware component.  Even if the company manages the tracking of the fleet, the customer would also want to view the movement and location of his fleet. He would also require details on a real-time basis.

The software developed should meet the requirements of the tracking business and the fleet operator. The software’s design must be simple to use. They should have urgent tech support 24/7 and internationally.

At the start, it is recommended that the business partner with an experienced software provider. The business can be started without a big investment. The software can be upgraded when the business takes off.

The monthly software solutions are ideal for companies with a limited budget. A monthly fee is paid depending on your tracking requirement. This way expenses can be planned more accurately. 

They will install and run the GPS tracking system. They will add the business logo, domain and address. You have access to free software updates and tech support.

Read Also: What Are The Benefits of Fleet Management Software?

The unlimited lifetime software can be purchased from the providers at a one-time amount for the license. This is ideal for businesses that want to save money in the long term. Budget planning is made easier. They install and set up the system providing tech support.

4. Hardware Selection

There are many hardware providers. The factors to be taken into account while purchasing hardware are price, quality and functionality.

Price is normally dependent on the quality of the device. Price is also dependent on the quality of material used in the manufacture of the device. The place of manufacture also is of concern.

Hardware selection is based on the functions required by the customer. Simple functions like tracking personal cars may require simple trackers. But if additional features like fuel sensors, temperature sensors, fuel flow meters, etc are required then more sophisticated GPS tracker systems will be required.

Hardware of superior quality and make will be of greater accuracy and will require less maintenance. 

5. Setting up Business

Setting up the business entails obtaining the required business license from the authorities concerned. All legal formalities are to be completed. This can be done through licensed lawyers.

In today’s scenario, the business must have a professional website. Creating a website will be time-consuming and expensive. Out-sourcing to professional website building services will be affordable and faster. The website can be customized with social media and E-commerce integration.

Advertising is essential for establishing a new business.  Advertising in newspapers, magazines and on TV will be expensive compared to digital marketing platforms. 

Advertisements on different online channels have a better reach. Working out a combination of channels to advertise on to get maximum return on investment would be advisable.

6. Starting Operations

Once all the formalities have been done, the business has to concentrate on serving their customers. The business has to work towards establishing a reputation and increasing their clientele. It requires hard work to service the customers and to find new ones to make the business sustainable and profitable.

If you are new to the vehicle tracking business, it is suggested that you partner with an experienced business partner. This will help in learning the business – where to concentrate, what to avoid and how to generate profits in the short run.

An efficient vehicle tracking system will raise the fleet’s productivity and vehicle utilization. It helps to reduce the distance driven, fuel consumed, over-time and idle-time.

In addition to all this, the tracking system helps from getting lost, in accessing roadside assistance, in providing alternate routes in case of accidents or traffic blocks.

Read Also: How Does IoT Help In Fleet Management?

Vehicle tracking systems can be used for a fleet of any size or type. Driver habits can be monitored. Green house emissions and other environmental concerns can be kept under check.

Reporting and data analysis is made simple with fewer errors. Real-time notifications prompt immediate action saving time and money.