All in the cards

Tight margins compel fleets to reduce overhead or leverage existing staff and resources. One ally in the battle for profitability is automation of routine processes. Because fuel is the most-often purchased commodity, managing those transactions is a major task.

Electronic pre-authorization with fleet cards has become the standard method for automating fuel purchasing and cash disbursements to drivers. Besides security and control over company funds, carriers also use captured data to automate other internal processes such as payroll and settlements, fuel-tax reporting and auditing of logbooks.

While many companies use one fleet card per driver, it’s not uncommon to find fleets that issue two or more cards to drivers. The reasons for having multiple cards include: pricing, access to more truck stop chains, and just to “play the credit game,” says Cynthia Cunningham, product manager of Fleet One LLC, a wholly owned subsidiary of TransPlatinum.

With fierce competition in the marketplace and huge financial backing from major banks, fleet card service providers, such as Comdata, Fleet One, TCH, T-Chek and Concord EFS, continue to beef-up their services to secure more of your financial and information needs. When looking at the number of services fleet cards offer today, the traditional “fleet card” used solely to purchase fuel at certain truck stops is obsolete, argues Mike Brewer, Comdata’s director of corporate communications.

Management controls
Although fuel purchases comprise the bulk of over-the-road expenses, many carriers use fleet cards to control all driver expenditures, thus having a single-source for all cash transactions. One advantage of single-source processing is that it allows fleets to audit drivers’ purchases and reconcile cash advances with payroll settlements – even before drivers turn in receipts.

Drivers for Tampa, Fla.-based Quality Carriers can purchase fuel, supplies, and get fast access to cash with almost zero administrative work, says Keith Margelowsky, the carrier’s vice president of performance planning. Management sets the company’s T-Chek card system with pre-authorized daily and weekly amounts for fuel purchases and cash advances. As Quality Carriers’ drivers – 85 percent are owner-operators – swipe their T-Chek cards at the pump or at the retail counter, the purchases are tallied against their personal file and automatically deducted from driver settlements.

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Quality Carriers uses sophisticated software that integrates card data into accounting and payroll systems. But even carriers that can’t afford or handle such integrated systems can still achieve a level of automation by pre-authorizing purchases for certain expense categories. With the Fleet One card, for example, fleets can separate cash disbursements to drivers into different “buckets,” Cunningham says.

Fleet One’s Over the Road (OTR) card has three different buckets: fuel, cash and miscellaneous. For the Local Fleet card, the buckets include fuel, additives, repair and maintenance. When cashiers swipe the card, the system prompts cashiers to enter the amounts into each category. When withdrawing cash from ATMs, the cash is automatically withdrawn from the cash “bucket” says Stacey Bright, director of marketing for Fleet One.

Another method of auditing all drivers’ expenses is through MasterCard and Visa co-branded fleet cards. Comdata, T-Chek TCH and Concord EFS offer a co-branded MasterCard that can be used at any retail location that accepts MasterCard charges. Concord EFS also offers a Visa card. With MasterCard or Visa services, fleets have the ability to select merchant category codes (MCC) to pre-authorize or decline purchases at specific locations and even a specific brand of product, Brewer says.

Data reporting
Besides controlling and accounting for road expenses, fleet cards are valuable reporting tools that, depending on your needs, might even substitute entirely for other systems. Sheilah Rushing, president of S&P Trucking, a 12-truck carrier based in Yantis, Texas, reviews Peterbilt TruckCare fleet card transactions online each day to track the location of drivers and to calculate the fuel cost-per-mile of loads.

“We can track our trucks even though we don’t have Qualcomm,” Rushing says. “Drivers have cell phones, but this gives us a way to monitor locations as most drivers fuel once a day.” Calculating fuel cost-per-mile on a per-load basis is possible because card readers at truck stops prompt drivers to enter their odometer reading at each fueling, and this data is included in the daily transaction report, Rushing says.

H&E Equipment Services, LLC, a 350-truck fleet in Baton Rouge, La., receives from Comdata each month an electronic, tab-delimited file, which the company converts into an Excel spreadsheet. Bridget Hayes, purchasing manager for H&E Equipment Services, says that she and other administrative personnel use the spreadsheet to “manipulate data into format readable or useful to us.” In other words they sort data by truck driver, date, mileage or any other parameter according to different internal needs.

“We have a compliance administrator who keeps track of all the fleet: the location, who is supposed to be driving the vehicle, etc., to keep up with DOT logbooks,” Hayes says. The compliance administrator uses these reports as other carriers would use GPS tracking records. “She matches up logbooks with the Comdata reports in an electronic file by sorting and manipulating the data into a format readable to her to find discrepancies with dates and times they say they fuel,” Hayes says.

You might not want to rely too heavily on the precision of the time data from fleet card reports, however – at least not without a little research. Although the actual receipts a driver obtains at the fueling station should be precise, reports generated by fleet card vendors may be based on the time the fueling transaction was authorized, not when the actual fueling takes place. Discrepancies might occur if there are equipment or system problems at the fueling location. Also, be aware of potential time zone issues. The report might reflect the time zone of the fuel card vendor, not the fueling location.

Another concern with data occurs with MasterCard or Visa co-branded fleet cards. Data reporting isn’t uniform. Each product has its own merchant category code (MCC), and each individual store has its own MCC, says Comdata’s Brewer. Some merchants report “Level 2” data as opposed to “Level 3.” Level 2 data tells the time and location of the purchase and whether the purchase was fuel or “convenience store.” Level 3 gives all of Level 2 data and reports the details of the purchase right down to the specific product and brand name, Brewer says.

Love Box Company Inc., a provider of warehousing and logistics services, uses the Comcheck MasterCard Corporate Fleet Card primarily to buy fuel, but the company also authorizes a small amount of maintenance items such as oil and radiator fluid, says Kelly Doersken, information coordinator for the 100-truck Wichita, Kan.-based carrier.

“A lot of the retailers we use don’t provide a lot of information we would like to have,” Doersken says. “In some cases on an invoice, the location coded by MasterCard doesn’t appear as a fuel transaction but goes into the catch all miscellaneous account and shows the amount only.”

At some locations, the card reader will ask drivers for a prompting on unit number, odometer reading, and include the quantity of fuel and cost automatically on receipt. On the company’s invoicing reports, however, all of this information isn’t included, although it is printed out on the drivers’ receipts.

“This hampers the reporting capabilities because the data isn’t captured by MasterCard,” Doersken says. To maintain consistent expense reporting, Love Box Company has its drivers enter the information from their receipts into an AS/400 computer program at their respective terminals at the end of the day.

Using multiple cards
While not always possible to get the same level of detail for all transactions, using the MasterCard or Visa cards do guarantee service at all merchants, independent of competing fuel networks. Comdata’s Classic Comchek card and Fleet One, for example, are not accepted at Flying J Travel Plazas. Even without using MasterCard or Visa cards, however, carriers can consolidate fuel networks using two or more cards with integrated software systems.

“We’ve always used one card,” says Tim Pike, accounting manager of Mercer Transportation, a 1,230-truck, all owner-operator carrier based in Louisville, Ky. “But 100 percent of our drivers are owner-operators, and they needed to buy fuel at Flying J.” Because the company’s card was not accepted at Flying J, Mercer began using the Transportation Clearing House (TCH) card services about three-and-a-half years ago. Mercer now provides drivers with both cards.

The maintenance and reporting of both Mercer cards is seamless through the FlexFuel program in the company’s Innovative Computing Corporation enterprise software system, Pike says. Some of the benefits of this integration include automating the calculation and payment of fuel surcharges and rebates to its drivers for fueling within its network, Pike says.

“We accumulate each driver’s refund and credit it back to them once a year. Some may get $50, while some may get $800 or more.”

All of the largest transportation software providers, such as McLeod, Maddocks, Innovative and TMW, have developed more universal fuel card interfaces that make it easy for fleets to manage cards from different fleet card vendors, Cunningham says. In addition to the fuel interfaces developed by software providers, the fuel card services can convert their data in-stream to match customers’ system specifications.

“We have data in a standard TCH format, but we’ll push that transaction detail to carrier in whatever format they want, whether it’s Comdata’s or any other format,” says Karl Kelley, director of marketing for TCH. “This gives (fleets) the flexibility to change cards without changing their entire system.”

Having a single fleet card platform not only simplifies the management and control of cash purchases and expenses, but other administrative tasks, such as payroll services and fuel-tax reporting. Fleet One customers – primarily the over-the-road fleets – for example, may choose to outsource its payroll services to Fleet One’s payroll service partner Paymaxx ( Cunningham says that fleets send Paymaxx an electronic file with all the payroll information, and then drivers choose how they want those funds to be distributed.

“The drivers can go online and choose direct deposit, check, or to put funds to their card,” Cunningham says. In a similar vein, fleet card vendors can also help carriers automate their fuel tax reporting with their own fuel-tax services or by automatically sending the recorded data in the proper format to the carrier’s fuel-tax reporting company, such as Inter-Tax.

Online conveniences
Although changing cards or adding a new card can be made a relatively transparent procedure these days, the online services offered by fleet card vendors makes it enticing to keep all data in one place – especially carriers that lack in-house software systems to integrate data from two or more cards into one report.

Carriers can use the Web to view online reports of transaction details and current diesel prices at truck stops within the network, and to manage their fuel buying programs and vendor relationships.

Comdata’s Network Manager is an online system that fleets can use to analyze and manage its vendor relationships within the Comdata fuel network. According to Comdata, Network Manager users can view fuel purchase detail and summary reports based on criteria such as: chain and/or association, by state or interstate segment, and view diesel prices by rack, tax detail, and transportation and spread detail by location.

“They can manage fuel prices in Comdata network and also manage their own proprietary fuel relationships – their relationship with Pilot, for example,” says Comdata’s Mike Brewer. Customers can also key in directional information from point A to B and get routing and data management based on the current fuel prices at each stop for real-time decision support, Brewer says.

T-Chek provides an independent list of diesel prices on its subscription-based E-Stop online service. The daily prices are posted, by location, from actual fuel purchase transactions with the T-Chek card, which is accepted at all locations, says T-Chek President J.J. Singh.

“E-stop is basically a useful tool to look at how to purchase fuel,” Singh says. “Customers also use it to do analysis, such as if they are purchasing well and how they are buying fuel.” The E-Stop online services also include software programs for fuel buying and routing optimization.

Besides the information and cash management tools, fleet card providers also offer a number of fringe benefits, such as emergency brake-down service, hotel discounts, long-distance services, driver messaging, etc., to cement their strategy to become your single-source of moving money and information between you, your employees and other businesses.

As fleet cards expand their offerings and flexibility, don’t be surprised if one day you discover that everything you do is through the cards.

Going cardless
The card could be a relic of the past for fleets that buy fuel at Flying J. locations. A subsidiary company of Flying J, Transportation Clearinghouse (TCH), developed a cardless system that started as a project with IWX Motor Freight, a 500-truck carrier based in Springfield, Mo., says Todd Staples, fuel manager of IWX.

The system that IWX and now many other companies use at Flying J works like this: A driver is prompted by the screen to enter the company’s ICC number at the fuel island, followed by his Social Security number. After the driver fuels and hangs the pump up, the transaction is sent electronically through TCH and invoiced to the carrier.

“Cardless is the wave of the future,” Staples says. “Cards are a high maintenance type of system.” Besides drivers losing cards to theft or some other reason, even with preauthorization cards are not very secure, Staples says. “The driver doesn’t have the ability to cancel them. It’s a high-risk type of thing.”

Meanwhile, the cardless system transmits the data in the same fashion as card-based systems. Staples says he goes online and monitors fuel transactions for the previous day and downloads the data into the company’s AS/400 system for fuel-tax purposes.

“It’s not a live type of monitoring, but it works for us,” Staples says.

Sheilah Rushing, president of S&P Trucking, a 12-truck carrier in Yates, Texas, says she prefers the cardless feature of the TCH services at Flying J to her card-based fuel network. Invoices from TCH are faxed to the office and the drivers are not required to stuff fuel receipts in their trip envelopes.

“I like that feature really well – we don’t depend on driver matching up fuel receipts,” Rushing says.