Fleet management organisations (FMOs) can help support local government agencies and councils with their cash flow management by offering vehicle sale and leaseback arrangements.
As the Australian economy begins to recover after the COVID-19 shutdown, local government agencies and councils will need to make tough judgement calls and take tactical steps to survive.
SG Fleet is one FMO that delivers successful sale and leaseback outcomes thanks to its initial vehicle profiling and regular vehicle inspections throughout a lease contract.
The process begins with an organisation confirming vehicles that are ‘in-scope’.
Each sale and leaseback is done on a case-by-case basis.
It is difficult to quantify generic savings as it depends on a number of variables that have to be considered, including weighted average cost of capital applied by the customer, tax rates, type of vehicle and its age and mileage.
Generally, based on SG Fleet’s lease versus buy calculator, the benefit could be between $1400-$1500 per vehicle over the vehicle lifecycle. When you multiply this by the number of vehicles in a fleet, the savings are substantial.
Each customer will have different motivating factors for a sale and leaseback.
It may be to release funding tied up in owned assets, with the desire to transfer the residual risk over to an FMO like SG Fleet and minimise risk on the re-sale of those assets.
It can also minimise fleet administration and reduce and consolidate running costs onto one bill per month for the entire fleet.
This allows for easier forecasting, with fixed monthly rentals, as well as leveraging an FMO’s purchasing power for future replacement vehicles and running costs such as fuel, maintenance, and tyres.
An easy transition via a sale and leaseback ensures no disruption to the organisation or drivers.
Phone: 1300 138 235
website: sgfleet.com
*Copy supplied by SG Fleet
