Early understanding of supplier and trading strategies is an essential aspect of the design of a fleet contract, as certain elements of a supplier and trading strategies are relevant to the establishment of an ideal contract. The implementation of a Request for Information (RFI) and a Request for Proposal (RFP) is essential to guarantee the fleet contract and enable fleets to acquire the most competitive products and services. “If the leasing structure is a current capital lease in North America, you need a Master Services Agreement (MSA) to cover items such as fuel and maintenance, and then a master leasing contract (MLA) to cover the terms of the financial lease,” said the fleet manager. “If the leasing structure is an operational lease, you would only need a GW and perhaps a variation agreement to make changes to the wording of the GG as written. Another type of contract that fleet managers can execute is an International Framework Agreement (IFA) that covers conditions such as account management, which are relevant to CME and are used by a company for their fleets in several countries. “The categories of contracts for the acquisition of the fleet are generally based on the type of commitment and types of products and services that are acquired. The different categories may include recommendation agreements, reseller agreements, product or service agreements (products, professional products, legal, financial, training, personnel, contractors and other services) and software licensing agreements,” said Barbara Banas, Senior Director of Wheel Procurement, Inc. The initial confidentiality agreement that will be reached when the contract is established is intended to protect negotiations with suppliers, Banas said. “The terms of a contract can change completely in the face of new circumstances, such as new leadership, new business/financial objectives, corporate cash flow,” said the anonymous fleet manager. I thought it would be more effective to change the contract if senior managers and the global general passed the needs directly to the seller. One of the main objectives of the fleet contract is to determine the type of relationship the fleet wishes to have with its supplier or supplier.
Contractual terms may be changed, which may result from a change in the operation of the supplier or any interference with the relationship between the fleet. “It is extremely advantageous for fleet management companies to develop a contract model for each business-specific purchasing category,” she said. “General categories for fleet management companies generally include assets, maintenance, dealerships, leasing, auctions, transportation, subscriptions and professional services, among many others.” Securing contracts that meet a company`s purchasing needs – and guaranteeing good results – remain essential to the fleet`s procurement process. An effective process is possible when we are able to discuss with key suppliers and stakeholders, understand supplier strategies and negotiate with suppliers, and measure key performance indicators (KPIs). Fleets and fleet management companies can work together to create ideal contract models for certain purchasing needs, Banas said: “A strong group of KPIs is the guarantee of supply, quality, service, costs, innovation, relationship – commonly known as AQSCIR,” said the fleet manager.