Hendon Publishing - Article Archive Details
First Procure, Then Dispose
For those seasoned fleet managers, you know there is more to the job than just going out and buying replacement vehicles. For those new to the process, you may find that it’s a bit cumbersome, but there’s a reason why it’s so. I’ll attempt to cover the many different aspects of purchasing and explain the process.
Buying a police car isn’t much different from a buying, for example, a high-def television. It all starts with identifying your needs. How big of a screen do I need?; 60 MHz or 120 MHz refresh rate?; is the primary purpose of this TV, or does it serve any other uses?; how much do I want to spend?; do I have a brand preference or favorite retailer? These are all good questions when considering a large investment.
You may buy a small screen TV without giving it much thought, but how about a 42-inch TV or larger? If you’re like me, I’ll spend hours researching what I want to buy. Just think how long this research would take without the Internet. Not only do I look at the specifications, warranty and features, but I also query users evaluations and repair history.
Believe me when I say my friends and family call me obsessed when I’m buying something of high value, but they also call me to find out what I learned so they don’t have to do the research themselves. I’m a firm believer that you get what you pay for, but that doesn’t mean the least expensive item is the worst either. To me, it means I can make an educated decision based on the facts of my research.
OK, so how does it work with police cars? The same way. First and foremost, you need to know what kind of vehicles you have in your fleet; how much it costs to operate those vehicles; how those vehicles are used; and how many miles are accumulated annually. It’s pretty easy data to compile if you have an automated fleet system. Not so easy if you don’t. But regardless, you need the basic information outlined above before you can determine what you need to replace in your fleet.
Once you get the information, decide which vehicles are at the end of their lives and/or are costing too much to operate. Make a list and assign each vehicle a number. They are then replaced in order according to the number assigned each vehicle. So if you have enough money to buy 10 cars, you replace cars #1 through #10 and not #1-#5 and #15-#20. This eliminates anybody from saying you playing favorites or if someone attempts to pull rank (beside your supervisor).
If you already have funds allocated for new vehicles, then it’s a matter of approximating how many new vehicles and what types you can purchase. If you don’t have funds already, then use the list you created as the basis to identify how many dollars you need and request them through your command. Provide all the relevant data with your request, and project out an entire year what will happen if those vehicles are not replaced.
Include how many miles will be on the odometer next year at this time, what kind of major repairs will be required to keep units on the road, and how much it will cost your department. Don’t forget that you’ll still have to pay for routine maintenance for new vehicles and tires, but what you’ll get with a new vehicle is a new car warranty that can save your agency thousands of dollars.
Let’s assume you have a budget to buy cars now. What’s next? Do you go to Fred’s uncle because he’ll give you a good deal but knows nothing about police cars? Do you write a specification from scratch and hope you include all necessary items? Do you buy off of established contracts?
For the sake of this exercise, let’s assume you are buying a certified police package squad car. The first thing is to examine the specs from the last squad cars you purchased. If it was more than five years ago, you will probably have to rewrite the specs completely! But if it wasn’t, use the last set of specs as a blueprint to compare to the new vehicle specs to see what is standard that wasn’t an option before; what’s not offered anymore; and what’s new.
Next, check with your officers to see if those cars were equipped adequately. Also check with your service and radio technicians for their input on items to possibly include that would make their jobs easier and faster to complete.
You will also want to check the vehicle manufacturer’s website to download detailed information about standard and available options. You may find that there are many options such as lighting and other enforcement equipment not included on previous models. Ordering the equipment directly could be a timesaver for your technicians and may provide an opportunity for you to buy equipment you didn’t have a means to buy before.
A great resource is your past vendors. Call them, and if they are nearby, meet with them and go through the specs for the last cars you ordered and compare them to the new model. They may also have a new model on their lot for you to inspect so you don’t have to guess about what the car has or doesn’t have.
Writing a spec doesn’t mean you have to be the one to necessarily bid it. You can possibly piggyback on a city, state, cooperative, federal GSA, or other established contracts. By having your spec at hand, you can review the existing contracts and see if they meet your needs. If they don’t, you can ask them to amend the contract.
Purchasing off of an existing contract will more than likely save you money because the contract encompasses more volume than your purchase. This would definitely be an advantage for your agency. Additionally, you can save time by not having to go out with your own bid and wait four or more weeks before the bid is awarded.
My advice is that if there’s an existing bid you can jump on that is within your fiscal projections, do so. If it means modifying your specs, then you need to assess those differences and make a decision. For example, you don’t actually need twin spotlights, but the state bid cars with twin spots are cheaper than other bids.
That’s a pretty simplistic approach to writing specs and buying off a contract, but for probably 85% of agencies, it works efficiently. If you don’t need to reinvent the wheel and create bureaucracies, then don’t.
I remember hearing Ford Motor Co. say the Crown Vic could be ordered 2 million different ways due to the number of options! If squad cars could be simplified with a limited number of options, the price would probably drop, but how many police agencies are willing to reassess their needs in order to simplify the car-ordering process? Probably not as many as need to, but the time may come when it’s absolutely imperative or the manufacturers may make the decision for you.
Next, look at the choices of what to do with the vehicles you are replacing, assuming these vehicles are not leased and you have to return them to the leasing company. You have simple options: sell, trade or junk. But in truth, it’s not that simple.
Sell. That means dispose of your vehicles at the end of their lifecycles and set a price to sell or auction them. If you don’t have a means to put these funds back in your fleet account, explore this option rather than putting those funds back in a municipal or general revenue fund.
Sell your vehicles at a median mileage like many agencies do in order to obtain more funds for these vehicles. If these funds can be directed into your fleet fund, you can decrease the amount of funds you need to request annually from your city council or legislature. This also keeps fleet maintenance costs down since you’re not waiting until the end of the lifecycle to dispose of these cars. You’ll be surprised how many agencies will line up to buy your 80K- to 100K- mile vehicles and are willing to pay top dollar for these cars.
Trade. Include a trade clause in your new vehicle bid providing for the dealer to purchase your used vehicles and deduct that amount from what you owe him. It is a win-win for everyone. Money you receive from your cars can now be put toward your new vehicles instead of having to relinquish those funds to an account you may never see dollar one from. Again, this approach decreases the amount of funds needed from your agency.
Junk. This is a pretty simple option where cars that have a cracked frame, blown engine or are pretty much garbage are sold as salvage at auctions. This eliminates any liability on your part and gives you a way to clean off your lot. You’ll be surprised at how many junk yards bid on these vehicles for the spare parts and take them off your hands.
Though simple, sometimes certain aspects of these approaches are hard to convince the command staff to implement. I relied quite heavily on the sell and trade options when I was at the Illinois State Police due to department policy and procurement guidelines.
My command agreed with me about selling vehicles at a median mileage range, but we could never get the Illinois legislature to appropriate the necessary funds to get the program off the ground. I was able to prove I could decrease the amount of vehicle appropriations I needed by 40% annually, but as simple as it seems, it was a difficult concept for lawmakers to grasp.
Overall, write a disposal plan and have options. Work with other agencies if you need to in order to make your plan work. Don’t give up on your plan. And don’t celebrate too much if your plan passes the approval process. It can be taken away. Though administrations do change, if you can prove your program works, it’s difficult for a different administration to disprove it.
Dennis Tucker recently retired as police fleet manager for the Illinois State Police with 29 years of public service experience. He is chairman of the Police Fleet Expo hosted by the Hendon Expo Group. He can be reached at email@example.com.
Published in Police Fleet Manager, May/Jun 2009
Rating : Not Yet Rated
Click to enlarge images.