Fleets in focus: ACFO/Arcadia Group

It celebrated its 40th anniversary a couple of years ago with a proud and successful history of supporting fleet operators, but with a membership of just over 400, and fleets accounting for around half the total, the question being asked in some quarters is: is ACFO still relevant?

New chairman John Pryor’s response is unequivocal: yes. ACFO has a valuable and important role to play in the fleet sector, lobbying Government and sharing best practice. He would like to increase membership, but concedes that it’s a difficult task.
Nevertheless, its membership, which manages a combined fleet in the region of 120,000 cars and vans, is committed to the association.

A more balanced board has been voted in consisting primarily of fleet managers, with a mix of men and women, large- and medium-sized fleets. The national council, made up of representatives from the eight regions, also includes a large proportion of fleet managers.

Arguably ACFO’s biggest weakness in recent years has been its failure to promote itself and its achievements with sufficient gusto. And it’s had some notable wins for fleets.

Take the decision by the Government to provide benefit-in-kind tax thresholds for a rolling four-year period, helping fleets and their drivers to plan ahead with confidence. Or the recent announcement by the DVLA that online licence checking will be free of charge (at least initially) once the paper counterpart is scrapped.

Then there was the agreement by HMRC to update advisory fuel rates quarterly instead of annually to better match the figures to fluctuating fuel prices. And the impending removal (in 2016) of the 3% diesel surcharge.

That some of those successes – including keeping the VAT reclaim rule at 50% and the removal of the paper tax disc – were a result of a bi or tripartite approach with leasing and rental association BVRLA and truck/van association FTA does nothing to lessen ACFO’s achievements: it is, after all, the only one with the best interests of car fleet operators at heart.

It is also the only one run volunteer-style by fleet managers and suppliers who juggle their day jobs with their association roles. It has no full-time employees to plan strategy, organise events, attract new members or check the finances.

“ACFO is a members’ organisation, a conglomerate of best practice and a way of allowing the membership to put its point of view across to Government and influencers,” says Pryor.

“ACFO boxes above its weight, but my call is for fleets that are not members to join and help to increase our voice. We can bang the table louder if we have more people behind us.”

Lobbying is an under-valued remit of the trade association. Government understanding of fleet is patchy at best, and subject to re-education every time the Department for Transport changes its ministers (there have been eight secretaries of state for transport in the past decade).

“They don’t really understand what they can do to help fleets,” says Pryor. “Take the abolition of the tax disc; they didn’t realise how much that would help us.”

One of ACFO’s challenges is to represent the different views of its membership. Even a topic as seemingly straightforward as AMAPs (approved mileage allowance payments) evokes polarised views – some like it, others do not.

“We have to represent many viewpoints and that can be difficult for Government. Sometimes they come up with their own answer,” Pryor says. “Often there is no one answer that pleases everyone.”

That’s challenging enough, but ACFO’s bigger concern is membership and the widespread apathy of fleets. They are happy to sit back and benefit from the successes from lobbying Government, but are unwilling to support the association by joining.

“They get the benefit without being members,” concedes Pryor with a degree of resignation, although he also points out that “if we don’t have an ACFO, there is no-one to represent them”. He adds: “We are the independent voice shouting in the Government’s ear.”
Last week marked Pryor’s 25th year at his ‘day job’ at Arcadia Group, the UK’s largest fashion retailer and owner of BHS, Top Shop, Burton and Dorothy Perkins. He joined as facilities manager, taking responsibility for vehicles when asked a question familiar with fleet managers up and down the country: “What do you know about cars?”

At that point the fleet was divided into separate operations. As the business prepared to switch from outright purchase to sale and leaseback, each operational head was asked to write a document on the process. Pryor was the only one who did. Cue his appointment as group fleet manager.

He describes his job today as “policing lease providers. I am not a fleet manager in the old sense of being an engineer. I manage a process”.

Pryor was arguably in the vanguard of managing supply chain contracts, particularly with a leasing provider that supplied a service as well as funding for vehicles.

Process management allowed him to add mobile phones to his job spec and responsibility for travel management. That was 15 years ago.

Much has been made about fleet managers becoming travel managers, but there remain few examples in the fleet sector.

“I went to my boss and asked to take on travel because I saw the synergies,” Pryor says. “Amalgamation of roles will increasingly happen, with facilities, risk, travel and procurement. It’s about processes and managing contracts that are less specialised than vehicles. Fleet managers should embrace the other areas; it helps them to make a much stronger case of why the business needs that role.”

Pryor’s involvement with ACFO began by chance almost 19 years ago. During a factory tour at Vauxhall he met Jim Thorn, one of
ACFO’s founders.

“He sold me on the idea of joining,” Pryor says. “It was the only place to go and hear what was happening and to understand the many ways of running a fleet. It gave me ideas to try out on our fleet.” He believes the growing complexity of running a fleet makes ACFO an even more essential body for members.

Legislation has increased, funding options have grown way beyond the traditional choice of buy or lease, taxation policies have evolved, even the way people want to use their cars has changed. Reinforcing much of the transformation has been technology.
“Too many people think that fleet is easy, but it’s complex if you look at all the elements. Fleet is interconnected with many areas – purchasing, HR, finance, travel, etc. You are dealing with people’s tax affairs, personal life and business life,” Pryor says.
“ACFO is a sense-check that you are doing things in the best way for your business.”

In 2006, ACFO started referring to itself only by its acronym, dropping the reference to the expanded ‘Association of Car Fleet Operators’. The subtle move was intended to recognise the van elements of many members’ fleets and coincided with a move to attract small and medium sized businesses into membership.

SME fleets – usually without a dedicated fleet manager – are still a big target for the association, but dropping the explicit mention of ‘car’ from its name has not opened the doors to a flood of van fleets.

Pryor acknowledges that ACFO’s knowledge base lies in cars. Consequently, it has moved closer to the FTA when making representation to Government and the DVLA. The relationship has strengthened since the return of FTA fleet manager Liz Hollands as chairman of ACFO’s southern region.

“With the FTA we create a pincer movement for a united front with Government,” Pryor says.

He has sought to improve both external relationships (FTA, BVRLA) and internal relationships with the national council, which has been critical of the board in the past.

Pryor intends to improve communications between board and national council by sharing proposals sooner and before final decisions are made. He has also given each board member responsibility for a particular area of association business, such as the website, seminars, membership communications and the annual awards.

One of those responsibilities is liaising with the national council to ensure the right messages are shared.

Pryor is also looking for national council to identify the big fleet issues facing their members that can be fed into a regular seminar programme. So far this year, ACFO has run well-attended seminars looking at electric vehicles and parking/motoring fines.

So what are Pryor’s priorities; how will he leave his mark on the association? He bats back the question, pointing out that he is part of a board so decisions are taken collectively. However, he recognises that ACFO is going through a transition period towards becoming a better structured organisation around the website, regions and seminars.
One thing he is certain about is ACFO’s future: the need for fleet best practice and representation to government is undiminished.
“There is more electronic communications and more outsourcing but nothing has really changed in how companies are run,” he says. “They still have someone that needs to manage the lease provider and supplier because it’s your driver’s name on the P11D.
“There are a million and one ways of running a fleet but too many people rely too much on their lease provider.

“We’ve had new members come to meetings that have learned what others do and that has changed their policy. That independent information and knowledge is not available elsewhere.”

Every fleet manager has faced unexpected challenges presented by drivers and, sometimes, suppliers – they are situations for which no-one can prepare.

John Pryor reveals a couple of examples that he has experienced over the years.

One involved a series of parking charges chalked up by one driver who denied he was to blame. It turned out an aggrieved girlfriend had taken his car and started parking it on yellow lines. Once a ticket had been issued, she moved it to another set of yellow lines. The final bill exceeded £700.

On another occasion, a seemingly straightforward puncture on a £110,000 luxury model ended up with the car off the road for six days because the manufacturer couldn’t get the correct tyre.

Pryor, like his peers, also has to contend with challenges specific to his fleet. Arcadia’s fashion-obsessed staff care more about the interior materials in their cars than anything else.

It results in some highly-individualised looks which can throw up challenges if the car needs to be reallocated. “That’s the beauty of running a fleet – its diversity,” Pryor says.