USFL President Says Customer Service to Drive Lessor’s Growth

Last May, Associates First Capital appointed Rick Schwartz to be president of US Fleet Leasing (USFL). Schwartz was previously president of Prudential Relocation Co. During his 15-year tenure there, Schwartz held positions in operations, customer service, and sales. Shortly after the appointment of Schwartz as president, Associates First Capital Corp. announced on June 18 that it would acquire Newcourt Credit Group’s automotive fleet management businesses in Canada and the U.K. Also, several months earlier, USFL had begun consolidating its purchasing, license & title, vehicle remarketing, and billing departments, previously co-located in its San Mateo, CA, and Carrollton, TX, offices, to one location at its expanded Carrollton headquarters. AF visited USFL to learn more about Schwartz’s business objectives, the implications of the recent acquisitions in Canada and the U.K., and the consolidation of some of its operations to its headquarters office. Here are the excerpts of our interview with Schwartz. AF: You’ve joined US Fleet Leasing at an interesting time. Shortly after you were hired, the announcement was made that USFL would acquire the Newcourt fleet businesses in the U.K. and Canada. How will this acquisition benefit your clients? Schwartz: The acquisition makes us the third largest player in Canada by more than doubling the size of our existing Canadian organization. There is a lot of cross border activity that is engaged in by our North American client base. As a result of the acquisition, we are now in a much better position to service their needs, whether they are Canadian-based or U.S.-based. Also, having a physical presence in the U.K. is a natural extension of where our client base in North America is taking us. We all know there is increasing interest in global fleet activities by multi-national corporations. By having an on-site operation in the U.K. it puts us in a better position to service those clients that have needs there, regardless of whether they are based in the U.K. or the U.S. AF: As president of USFL, will you have operational and strategic management responsibilities for the newly acquired U.K. and Canadian operations? Schwartz: USFL already had a presence in Canada, so this acquisition will be an extension of that. In terms of the U.K. operation, we are just starting to work on the integration plan. We will work in conjunction with our Associates international business operations to execute the best overall fleet strategy in the U.K. But on a day-to-day operating basis, it will be under one strategy and operation. AF: How will USFL market itself in the U.K. and Canada? Schwartz: The U.K. and Canadian operations are separate entities. We will be known in Canada as Associates Fleet Services. In terms of the U.K. operation, its name was changed in August to Associates Fleet Services Limited. AF: As USFL’s new president, what are your plans to increase revenue and portfolio growth? Schwartz: Acquisition will certainly be one part of an overall growth strategy, and we don’t intend to stop looking at acquisitions just because we consummated the Newcourt acquisition. But more fundamentally, I believe the way to grow our business is by providing such outstanding service to our existing account base that they allow us to do more to serve them. There is a lot of room for growth in our existing account base. Business is highly competitive, and the way to attack that is by being the most outstanding player in the field. Our goal is 100-percent customer retention and 100-percent customer service. We are committed to building long-term customer relationships and one of the ways we will accomplish this is by ensuring that we have great employees working in a great environment. We are also committed to ensuring that we have the best technology to support our processes and clients. AF: How much growth has USFL experienced in the past year? Schwartz: When you combine internal growth with acquisition, we are probably up 25 percent in receivables. AF: How is USFL looking to increase its business in the small fleet market? Schwartz: We are absolutely committed to this market segment and it has been one of our strengths. We have twice as many salespeople focused on this market segment than we do for the large fleet market simply because there are so many more organizations that have fleets of 250 vehicles or fewer. AF: How is the integration of the four departments from your San Mateo, CA, office to the Carrollton, TX headquarters progressing? Schwartz: The decision leading up to consolidation was a difficult one. But now that the plan is in place, it is going very well. We migrated different functions from our San Mateo, CA, office to coincide with their business cycles, which naturally ebb and flow. When their business cycles were at their low points, that’s when we relocated the different functions to our headquarters office. We have essentially completed the integration, and the consolidated departments are now operating in Carrollton. However, the integration really started a year ago with the integration of the technology platform. That was the precursor to all the physical movements that have recently taken place. We couldn’t do anything until we had a common technology platform to consolidate the financial, accounting, and billing functions. Once we completed that, we started to move people to Carrollton. AF: One of the trends in fleet management has been the emergence of e-commerce. Can you describe USFL’s e-commerce initiatives? Schwartz: Last May, at NAFA’s Fleet Management Institute, USFL introduced its Internet-based vehicle ordering system. It is currently in place with several clients who are using it to place 2000-model year new vehicle orders. The system gives clients the ability to order vehicles and to check on the status of their vehicles over the Internet. We have other Internet-based services that we are developing, which will be implemented in the coming months. Our e-commerce priorities are based on what clients tell us are of most value to them. AF: What other trends does USFL see occurring in fleet management? Schwartz: The issues that I see in the fleet business are the same issues that I saw in my prior business experience. Fleet managers are busier than they have ever been. They are doing more today than they have in the past. In most organizations, there is a lot more pressure on staff functions to do more with less. Fleet managers just don’t have the time to run their fleets. They are also seeing increased demands from their internal constituents who want more flexibility, more programs, more customization, and more data. I think that a great deal of the complexity we are experiencing in fleet management is driven by the demand for more customization and flexibility. The off-the-shelf solutions that might have been acceptable or useful five years ago are less and less useful today. They just don’t fit as many situations today. Fleet managers are looking for advice and counsel from their fleet management company on how to improve their fleet operations. I think it is safe to say that our customers, and the fleet industry in general, are relying more and more on their fleet and service providers to do more things to help them support the fleet administration functions within their organizations. Other trends I see include the drive to leverage technology by having an effective e-commerce strategy and the movement toward international global growth.