From day one, Hylton Treisman has been cutting costs at Lewis Day Transport. His appointment three years ago coincided with a period of rapid growth at the London-based transportation company – its fleet of vans, cars and motorcycles has almost doubled from 700 to 1,200 units. And all the while, Treisman has been finding new ways to reduce overheads.

He’s renegotiated contracts with suppliers, haggled for larger discounts from manufacturers, taken on a fleet management system, introduced telematics, brought accident management in-house and, in the single biggest investment, opened three large workshops to handle all the fleet’s aftersales requirements.

So just how much money has the former automotive electrical engineer saved Lewis Day from all these initiatives? “Hundreds of thousands of pounds – possibly half a million,” he says. “It’s hard to be exact because we didn’t know accurate figures before we had the fleet management system.”

Lewis Day Transport is divided between two operations. Its core business, which accounts for two-thirds of the fleet, is split between a courier company with everything from bicycles to 44-tonne artics, and a passenger transport division offering executive travel.

The second part is a medical division which couriers products and patients.

All vehicles are essential user and most are outright purchased; Lewis Day has no perk cars, even for the directors.

“We have wet our feet a few times with contract hire but we like to be in control of our own destiny,” Treisman says. “Our vehicles are working vehicles – when we sell them, usually after three years, they have done high mileage and we know that we will get below book value.”

The chauffeur cars typically cover 35,000-40,000 miles a year on a maximum three-year replacement cycle. The exception is the Toyota Prius: they are replaced every two years because Treisman’s figures show the cost to change is at its lowest on that cycle.

The vans have haphazard annual mileages – some of the Fiesta Vans cover 100,000 miles in their first year – and, consequently no fixed change cycle, although most last four years and 120,000 miles.

Lewis Day’s fleet is its business which means Treisman’s big two concerns are vehicle utilisation and minimising downtime – addressed via the tracking system and the workshops.

The tracking system reports on driver times/lateness, where the vehicles are, speeding and deployment. It gives Treisman a good understanding about how efficiently his vehicles are being used and helps him to coordinate the fleet more effectively. It’s been quite a struggle to get to this point, however.

The company was originally tied to a deal with GlobalLive where it paid up front for the tracker units. Treisman switched the contract 20 months ago for a more flexible monthly payment. Then GlobalLive collapsed.

Treisman took the opportunity to cut ties and signed a pay-as-you-go contract with AGM Telematics, a little-known company.

“We went with a small company because we were confident in them giving us the service with the large number of vehicles we have on their system,” he says.

The changeover has been difficult and drawn out. Lewis Day is currently running four units, including the old GlobalLive trackers, but AMG has all the different hardware working on its system which enables Treisman to run reports for the entire fleet.

When Treisman joined Lewis Day it had contracts with several back street garages for mechanical repairs and bodywork that were inherited during a business acquisition.

Those were dropped as all aftersales work was brought in-house at one of the company’s four workshops – three of which are large, modernised facilities with the latest technology and fully trained staff.

Treisman believes the benefits to the business are two-fold: it saves money and the vehicles are off the road for less time.

“Work is done at a time when we need it doing – that’s not possible when you are using an outside repairer,” he says. “A vehicle off the road is a vehicle that is costing you money.”

Can any company justify running its own workshop? “You can be paying £90 per hour at a dealership. We pay overheads and rates and this is where the equation comes in to say if the fleet large enough to do it,” Treisman says.

“If you have a sensibly run workshop that is correctly staffed and you do preventative maintenance on time so you don’t have breakdowns, it can be well worth the investment.”

He estimates that on the fleet of 60 Mercedes-Benz vehicles alone, each of which is serviced two or three times a year, Lewis Day is saving £80,000 a year.

In addition to its own workshops, the company has an in-house bodyshop. It enabled Treisman to bring accident management in-house earlier this year.

“Accident management companies try to challenge every claim so by the time you come to pay out the settlement costs have increased,” he says.

“Now we react to at-fault claims and try to come to a reasonable settlement for whiplash or other injuries without getting solicitors involved. We have reduced our costs by two-thirds.”

The company employs its own solicitors and has two claims handlers as well as its own claims forms to manage accident costs.

The bodyshop has an unusual staffing set up. Lewis Day employs only the bodyshop manager who sub-employs the other eight staff. Treisman believes it means he gets a better service without having to micro-manage the team – responsibility solely rests with the bodyshop manager.

Management of the fleet has been made easier since the company moved from spreadsheets to fleet management software with Southern Computers FleetMaster.

Treisman helped to develop elements of the system, such as inputting dents on a vehicle schematic so that the next time the vehicle comes in for servicing, the workshop knows what needs repairing.

The system also logs the drivers – if they swap vehicles, checkers do an assessment on a laptop with the driver present to confirm any damage. That’s key as the drivers are self-employed and using the company’s vehicles.

The software also calculates the best time to sell each vehicle. Treisman uses a mini auction with a small network of traders. He believes he gets a better price than going through auction.

Between 300 and 400 vehicles are de-fleeted each year, but as the fleet grows, Treisman accepts that he might need to start using a remarketing company.

“The point at which it gets too much is when you start having difficulty selling the vehicles. We’ve not had a problem so far,” he says.

Lewis Day has a need to be green. Its customers demand it.

“There are no tenders that we put out for that don’t have a question about how green you are,” Hylton Treisman says. “We have to weigh up the equation of being a transport business with the environmental concerns.

“The secret is realising that the economics of being green goes together with making profits – they are one and the same thing.”

He has one of the largest fleets of Toyota Prius hybrid models in the country (150 cars) and he recently signed up with the FOAS scheme. “Not only is it in our interest as individuals and as a company to be as green as we can, but that is also a major factor in growing the company and moving forward in the present climate.”

Lewis Day has trialled alternative fuels but was disappointed with the results. Electric vehicles promised a range of 100 miles but delivered only 30 once they were fully loaded.

Biodiesel looked like a viable proposition while diesel prices were sky high, but now the raw materials are too expense and it doesn’t add up for the company.

“Hybrids are the answer for now – there are massive savings to be made,” says Treisman.

“The manufacturers have also gone a long way to reduce CO2 levels,” he adds. “But the biggest reduction in CO2 comes from not doing the mileage. We’ve started to address this by employing drivers that are based closer to where the contract is.”

Company Lewis Day Transport

Transport manager: Hylton Treisman
Fleet size: 1,200 (300 vans, 400 cars, 300 motorcycles, plus ambulances and trucks; 200 cars are owner-driver)
Funding option: outright purchase, lease finance
Fleet department: eight staff
Replacement cycle cars: up to three years; vans: usually four years
Brands Ford (all vans), Mercedes-Benz, BMW, Toyota, Volkswagen