ZIMSEC O Level Commerce Notes: Transport: Advantages and Disadvantages of a trader owning their fleet of vehicles
Advantages to a trader of operating own fleet of vehicles.
- Goods can be collected and delivered at any time.
- Goods in transit are safe from theft and damage
- Minimises the delays of goods which are ready to be ferried.
- There is personal contact with customers
- The delivery persons:
- Can deal with queries from customers.
- Have good knowledge in handling the firm’s products
- Conduct transaction en route e.g. sell more goods, collect payments, collect crates for example a bakery vehicle.
- Return loads are possible e.g. empties and crates.
- Can advertise on the sides of vehicles.
- There are special vehicles for special cargo.
- Vehicles can be hired out to earn extra income for the trader.
- The status symbol of running their own fleet of vehicles.
- It is cheap and cost effective if the vehicles are adequately utilised.
- Can be used to ferry workers to and from work.
- Independent of public transport strikes and delays.
Disadvantages of a trader owning and operating their own fleet of vehicles.
- The initial capital cost of buying the vehicles is high
- High maintenance and servicing costs.
- The vehicles depreciate in value.
- High insurance costs for the vehicles.
- The vehicles may be underutilized especially if the fleet owner is a small business with infrequent deliveries to make.
- The vehicles may be misused.
To access more topics go to the Commerce Notes page.