Car Hire | Market, Trends, Growth | Suppliers Analysis

Strategic Sourcing Guide to Car Hire Procurement

Overview

The market for Vehicle Hire and Lease and its sub-segments such as Car Hire are at an interesting intersection. Telematics has found excellent adoption rates the world over and its adoption is only expected to grow more. This is creating challenges for category managers in aligning the specifications to the use of preferred telematics solutions as well as extending procurement activities to this new but still less understood category of products and services.

Traditionally procurement functions had a greater say in deciding the specifics of orders. However, recent trends indicate that all departments of a company, even drivers are included in the decision making and feedback loop. This creates opportunities to benefit for cross learnings but also increases the co-ordination and conflict management tasks of category managers.

The market has undergone several structural changes including M&As and vertical integration efforts of suppliers. This has resulted in some issues such as erosion of previously established supplier relationships but has also opened new opportunities to onboard new suppliers with a wider range of offerings in .

Trends like these and many others discussed in this report are necessitating a relook at the way Car Hire is procured and the procurement cost saving opportunities that exist.

Car Hire Procurement Best Practices

The report discusses in detail the best practices that have served well the category managers responsible for Car Hire procurement.

For example, A few of the factors that cause pollution from fleet vehicles are the use of outdated vehicles, inferior quality fuel, and poor maintenance. The rise in awareness about air pollution is forcing buyers to collaborate with service providers that adopt green initiatives and can offer green fleet solutions.

Buyers should engage with service providers that utilize technologies to generate reports with respect to fleet condition and services delivered.

Vehicle replacement cycles is a mechanism used to calculate maintenance and depreciation-related costs associated with a vehicle. Service providers perform such calculations on behalf of buyers. Vehicle replacement cycles enable end-users to follow safety measures and minimize operating costs. These are calculated after a certain mileage or specific years of use. Furthermore, buyers should engage with service providers that offer analysis with respect to fuel consumed as well as provide maintenance and repair services.

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Risks in Car Hire procurement

Car Hire procurement managers also need to proactively identify and mitigate potential risks that can arise in the supply chain or contracts for Car Hire procurement. Some examples include:

The rise in awareness about air pollution is forcing buyers to collaborate with service providers that adopt green initiatives. A few of the factors that cause pollution from fleet vehicles are the use of outdated vehicles, inferior quality fuel, and poor maintenance
Improper maintenance of vehicles increases operational costs and it is done on regular basis. Continuous exposure of vehicles to heat, air, and moisture leads to oil degradation resulting in improper functioning of vehicles
When requirements of the buyers are not absolutely clear or usage patterns are not stable or predictable, suppliers often build in \"cost buffers\" for unforeseen risks due to a lack of complete understanding on buyer's requirements. This increases the risk of overspending on Car Hire

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Who should read this report

The report is intended to serve as a one-stop reference guide for Car Hire procurement strategy and offers a perfect blend of category basics with deep-dive category data and insights. Therefore, it is ideal for category beginners looking for “Car Hire: Procurement Report 101” as well as for category experts actively tracking the global Car Hire procurement market.

You may have just initiated your research to design a winning Car Hire procurement strategy, or you may be a category expert looking for strategic insights and updated data.Either ways, the report has your requirements covered.

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Key questions on Car Hire procurement answered by this report

Procurement decisions can prove to be costly in the absence of careful deliberation and evaluation of every available option. In fact, more than 90% of the decision makers we work with acknowledge that timely availability of up-to-date category intelligence can help them make better purchasing decisions. More than 80% of them believe that in-house category intelligence needs to be updated periodically to achieve full benefits. If you have read so far, we are quite sure you agree!!

The Car Hire procurement report helps take more informed decisions by placing all the critical information and advice at the fingertips of a decision maker. It also specifically answers some of the key questions that we have been routinely asked during our industry outreach initiatives:

What is the spend potential in the Car Hire market?
What is the correct price to pay for Car Hire? What are the key trends and factors that influence current and future pricing?
Which selection criteria are the most important for Car Hire Suppliers Market?
Who are the top Car Hire suppliers? What are their cost structures?
Which negotiation levers can reduce Car Hire procurement cost ?
What are supplier margins in Car Hire market?
What are the best practices for Car Hire procurement and what are the potential risks?

SpendEdge Insights has helped procurement professionals and sourcing teams manage multiple spend areas and achieve more than $2 billion in savings. Activate your free account today!

Car Hire Category Insights: What is inside

The Car Hire market report offers a complete picture of the supply market and analyzes the category from the perspective of both buyers and suppliers. Analysis of the category trends, procurement best practices, negotiation levers and overall category management strategy advisory are interspersed with in-depth data and commentary on spend outlook, pricing ecosystem and supplier landscape drilled down to a region-level coverage.

Data

A key highlight of this report is the in-depth outlook created on Car Hire procurement spend and pricing trends. The report further delves deep into the aspects of cost structure, total cost of ownership and supplier margins for Car Hire. A dedicated section to supplier profiles and evaluation helps decision makers cast a wider procurement net and identify gaps in existing relationships.

Insights

Along with specific category and supplier intelligence, the publication also includes curated insights on Car Hire market trends, price influencers and inherent risks. These insights help the decision makers prepare for market shaping trends in advance and create alternative strategies for changes in the market conditions.

Advisory

Additionally, the report also advises on the best practices and strategies to manage the Car Hire category efficiently. Negotiation levers and opportunities are explained in detail along with quantification of their potential. Benchmark KPIs for supplier and buyer performance management are also aggregated to better organize the category objectives. Other themes of advisory include ideal procurement organization structure, enablers to achieve KPIs or category objectives and ideal SLAs to have with suppliers.

Category Ecosystem

Buyer and supplier ecosystem
Competitiveness index
Buyer and supplier power
Threat of new entrants and substitutes

Global and Regional Sourcing Insights

Category spend
Spend growth
Dynamics
Opportunities

Pricing and Cost Analysis

Pricing outlook and data
Drivers of pricing
Cost structure and inputs cost
Total cost of ownership
Pricing models and margins

Cost Saving Opportunities & Negotiation Strategies

Buyer and supplier side levers
Quantified cost saving opportunities
Negotiation strategies and quantified outcome

Procurement Best Practices, Strategy and Enablers

Procurement excellence
Sustainability and innovation
KPIs and category enablers
Risk management and outsourcing

Vendor Analysis

RFx essentials and selection criteria
SLAs
Supplier evaluation metrics
Detailed supplier profiles

Our research is complex, but our reports are easy to digest. Quantitative analysis and exhaustive commentary is placed in an easy to read format that gives you an in-depth knowledge on the category without spending hours to figure out “what does it mean for my company?”

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Category Research Framework

SpendEdge presents a detailed picture of Car Hire procurement solutions by way of study, synthesis, and summation of data from multiple sources. The analysts have presented the various facets of the market with a particular focus on identifying the key category influencers. The data thus presented is comprehensive, reliable, and the result of extensive research, both primary and secondary.