Sophistication, Personal Touch Ingredients Of Success

Donlen Leasing Corporation, a Lincolnwood, Illinois company, teams personal contact with computer so­phistication to provide a unique blend of services to its customers. Donlen leasing projected to double business every five years; sustains growth without aacquiring other leasing companies.

This professional yet personal ap­proach to leasing and managing fleets has proved successful and as a result the company manages over 12,000 vehicles throughout the United States and Canada, according to Don Rappeport, the firm's president.

Laurence Franceschi, vice president-marketing, forecasts that the com­pany's expansion rate is such that the business will double in size every five years. Donlen prides itself on the fact that this growth has been through the firm's own efforts rather than by acquisition of other leasing firms.

Donlen Leasing was founded in 1965 as a full-service lessor specializing in full-maintenance, closed-end leases. The closed-end, full-maintenance leases have given way to open-end leases with emphasis on fleet and expense manage­ment. Only about 50 cars remain on the full-maintenance leases for old-time clients.

Recognizing the changing market and the need for diverse management programs, Donlen offers innovative computer programs aimed at assisting today's sophisticated businessman. The programs aid in budgeting, evalu­ating used vehicle trends, reporting costs and focusing on the top priority of energy.

By using computer technology to monitor trends in depreciation, main­tenance costs and fuel expenses, Don­len is able to provide the information needed to make decisions that will keep fleet costs at a minimum, while utilizing all available resources.

Gary Tepas, vice president of sales for Donlen, said a key decision was made in the late 1960s by the com­pany to recommend that clients re­position their fleets into two-door specialty cars rather than the stand­ard business sedans.

"Donlen was probably one of the first to deviate from the typical busi­ness sedan that was used in the 1950s and '60s. In the late '60s and '70s, we really were the market leader in put­ting our clients in specialty-type cars. We were much more responsive to market trends than competition that sometimes waited and watched before they made recommendations to their clients. It really paid dividends. Ac­counts we put in these specialty cars dramatically reduced depreciation ex­penses compared to those firms which retained typical business sedans.

The information used to help make such decisions is being expanded to include makes and models by geo­graphic areas which show where the various styles are most popular. "We want to give them [the clients] as much information as possible so they can make a sensible business decision," Tepas said.

With the pending energy situation, such of the emphasis is placed on gas mileage statistics. These statistics indi­cate to the fleet operator how well or how poorly the vehicle is performing and give an indication of the driving habits of those assigned to the various vehicles. The internal reports used by Donlen monitor gas consumption by various models and powerplants. This information is used to make recom­mendations concerning future fleet purchases.

According to Leonard Vine, execu­tive vice president of the firm, there are three basic programs available with about a half dozen variations that can be tailored to the client's specific needs.

The first basic plan is a national account program in which fleet management customers can purchase tires, batteries, glass and repair serv­ices through Donlen. The customer can take advantage of lower prices on these items through Donlen's volume purchases. Donlen supplies the customer with purchase orders and authorizes requests for tires and serv­ices. Charges for services are made directly to Donlen, which in turn bills the customer. By having the billing for such expenses come from one source, fleets are better able to moni­tor costs.

The second plan offered by Donlen is a maintenance management service combined with a finance lease which encompasses all aspects of fleet man­agement. Donlen provides driver manuals, repair and tire purchase forms for drivers, supervises and con­trols repair costs and tire purchases for each vehicle and fleet operators directly contact Donlen on toll-free telephone lines for all major repairs and purchases.

When a vehicle is serviced, Donlen pays the invoice directly to the servic­ing facility and then sends one month­ly bill to the customer with supporting receipts. Donlen also audits all mainte­nance and repair invoices and reim­burses all drivers directly for out-of-pocket expenses. Data listing all ex­penses for tires and maintenance, as well as depreciation, rent, insurance, license and tax charges are sent to the fleet operator along with a monthly average cost for the entire fleet. Addi­tional data is also available on gas, oil, tolls and parking.

The final basic plan is similar to the maintenance management service ar­rangement except that it offers a much more detailed breakdown of expenses. This program is also available to non-leasing clients who wish to have a de­tailed computer report of their opera­tion. This plan reports monthly varia­ble costs, variable cost per mile, fixed cost, personal use credit, total unit cost, cost per mile, insurance recovery and average monthly expenses.

Tepas said a survey of customers showed Donlen offers two advantages over other leasing companies. The first is Donlen's willingness to custom-design computer reports rather than use canned reports. The second is the high quality of the redesigned reports which are issued quickly.

Ben Bilski, vice president-opera­tions, has incorporated another uni­que feature for Donlen Leasing - the use of a Xerox telecopier to place fleet orders daily. Bilski said the telecopier speeds up the ordering process to four or five hours rather than the five days it would take if the orders were sent by mail. Orders are taken continuously and every afternoon the machine is activated and orders are processed. Avoiding mail delays is a priority, according to Bilski, who add­ed that the telecopier allows Donlen to process an order instantly.

Along with the sophisticated gadgetry, Donlen believes in personal con­tact and counsel for its clients. Rather than using account executives, Rappeport said Donlen uses a management team concept. Each department head is available to the clients concerning the particular facet of the operation they deal with. For example, Rappeport said if a customer has a car coming off lease that won't, be sold for the amount projected at the beginning of the lease contract, he will be coun­seled by Richard Routson, who is in charge of used car disposal. An ex­planation will be made as to why the car is not getting market value. "That's so the customer doesn't get any sur­prises at the end of the lease," Rappe­port said. Routson said that a majority of the time the customer gets a refund on an open-end lease.

For the 1978 model year, Donlen sees a major pivotal point for fleet administrators moving from larger to smaller, more fuel-efficient vehicles. Rappeport said his management team works with the clients early in the spring to provide the client with enough data to firm up a policy for the approaching model year and that by July, almost 80-percent of the cli­ents were prepared to order for 1978. Early decisions enable delivery of new cars to be made in the early fall, tra­ditionally a time of strong used car sales.

By responding to today's changing market, Donlen has expanded while enjoying one of the lowest client turn­over rates in the industry.