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Power in Numbers: The Benefits of Entering Fleet-Vehicle Territory

Power in Numbers: The Benefits of Entering Fleet-Vehicle Territory
Image credit: Freightliner Sprinter
Namaste Solar's fleet includes Sprinter diesel cargo vans from Freightliner, Mercedes-Benz and Dodge.

In 2007, Namasté Solar, a company that installs solar-power units, acquired a used Dodge Sprinter diesel cargo van. "We could run B20 biodiesel in it," says Max Christian, co-founder and COO of the Boulder, Colo.-based operation. "It got almost 25 mpg, which was much better than a Ford Econoline van, and at the time it was a unique vehicle. It fit our image, and it was the cheapest, best vehicle we could afford."

Flash-forward six years, and Namasté is maintaining a fleet of 10 Sprinters, four pickups and six Toyota Priuses. And Christian is in the process of formalizing the company's next generation of vehicles, weighing the pros and cons of leasing or buying cargo vans to help carry out roughly 300 installations a year.

Compared to the stressful, hard bargaining associated with consumer purchases from a dealer, the commercial fleet transaction is more relaxed, according to Isaac Bouchard, a broker with Preferred Auto Brokers in Englewood, Colo. "There's very little negotiating with the fleet sales manager at a dealership," says Bouchard, who also runs CarBuyingTipsGuide.com. "These guys get paid to move units, so the margins are tiny or even below invoice to begin with. As such, the process is more about a relationship than price--they're going to remember you when you roll over your fleet every three years and take care of you."

You don't have to buy 50 trucks or cars from a manufacturer to qualify as fleet. "A common oversight of small-business owners is to realize that they've crossed the threshold into the fleet-vehicle market," says Chris Brown, executive editor of Business Fleet. "Some manufacturers will qualify a business that purchases or leases 10 vehicles in a 12-month period. Cross this threshold, and you'll get fleet incentives from the manufacturer, won't have to pay advertising markups like retail customers do and, if you order the truck or van, you can spec it out exactly as you want and not have to pay extra for standard equipment that retail consumers are forced to buy."

For Namasté Solar, crossing this threshold is a blessing, since it'll reduce upfront costs on the biodiesel-powered Sprinter vans that have become a hallmark of the company. "When we were first deciding on what to buy, I was all about functionality," Christian says. "I didn't see why going with a diesel van and hybrid car really mattered beyond fuel economy. But I see now how our vehicles create a consistent message of sustainability that resonates with our customers and the community. My one piece of advice to anyone is: Don't undervalue the marketing power of your vehicles."

Grant Davis is the Tech and Money Editor for Entrepreneur Magazine.

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This article was originally published in the October 2013 print edition of Entrepreneur with the headline: Power in Numbers.

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