New Cellular Program Aims to Increase Sales Power

A national cellular phone program, the first of its kind developed by a fleet management company, was introduced by Wheels to its client base on April 9, 1990. The move makes the Des Plaines, IL-lessor a niche distribution channel for fleet-specific cellular phones on a national basis. Although first introduced to the lessor's customer base, the program is available to all fleets whether or not they are a Wheels client.

The key fleet-specific features of Wheels' cellular program are consolidated billing, failed-unit replacement, flexible depreciation schedules, the option to combine cellular equipment cost in a vehicle's capitalized cost, a varied selection of phone models, and management exception reports. The management reporting package gives fleet managers the ability to control the program with minimal administrative work. Currently, 33 fleets are enrolled in the cellular program. By year-end, Wheels projects 50 fleets will be in the program nationwide.

Under the program, participating fleets lease the cellular phones at depreciation schedules varying from 12 to 60 months. "An important fleet-specific feature is the ability to capitalize the cost of a phone to a leased vehicle's basic cost," says Jeff Burns, assistant vice president and director of the cellular management program. "Besides reducing administrative work, this feature provides a funding advantage for the lessee."

The Wheels cellular program had its genesis in 1987 as a means of increasing driver productivity at client fleets. Two 15-month pilot programs were conducted with Union Carbide and Dow Corning testing cellular phone fleet applications prior to the program's formal introduction.

Consolidated Billing

An important fleet-specific feature of the cellular program is a consolidated billing system. Without consolidated billing, a nationally-dispersed fleet using cellular phones could conceivably receive hundreds of individual bills on a monthly basis. Compounding this problem is the fact that each cellular phone company employs its own billing procedure resulting in varying invoice elements, inconsistent formats, and sporadic invoice timing. Consolidated billing eliminates these problems.

In order to develop its consolidated billing system, Wheels signed agreements with cellular phone companies across the country so the lessor is billed for all phone usage by client drivers. Under these agreements, Wheels pays each cellular phone company and then rebills its clients monthly in the consolidated billing format. Another benefit to consolidated billing is that all charges are verified by Wheels in advance of fleet billing, saving a fleet manager hours of administrative work.

"A consolidated invoice relieves fleets from an incredible paper burden." says Burns. The billing system was specifically designed to ease the workload of administering the program by reducing paperwork. To achieve this, invoices were standardized for easy analysis. What appears on the consolidated invoice is each driver's name, cellular phone number, vehicle number, the service area, service charge, long-distance charges and tax, and airtime broken out in minutes and dollars by regular and roaming airtime. (Roaming is cellular service use outside of the subscriber's registered host area. When this occurs, a user's phone is electronically identified and billed as a roamer.) In addition, phone equipment and airtime charges can be summarized by individual corporate cost centers.

Management Reports

Wheels offers various management reports to help fleets properly manage and control cellular phone costs. These reports can identify cellular phone abuses by flagging calls based on expense, length, or call, frequency. Additionally, fleet managers can review calls by days of the week or call type, and compare usage on a monthly, quarterly, or annual basis. Other management reports list the volume of calls by individual drivers that exceeds a predetermined dollar amount or time, and usage during peak or off-peak hours. In addition, fleets can restrict cellular phone usage by taking advantage of existing services offered by cellular phone carriers. These include: limiting outgoing calls or only allowing outgoing calls to specific phone number(s), and restricting long-distance telephoning.

Choice Of Equipment

Three types of cellular phones are available: mobile, transportable, and portable. Available brands include Motorola permanent-mount mobile phones plus transportable and portable models manufactured by Motorola, Mitsubishi, Oki, and Panasonic. Wheels handles all the logistics for equipment installation.

According to Burns, mobile cellular phones are recommended for drivers who spend a large amount of time in their vehicles. Mobile phones offer hands-free operation and are permanently mounted in a position most convenient to the driver. The hands-free option is available with both mobile and transportable phones which, besides being convenient, represents an important safety feature.

Transportable phones can be used either inside or outside of a vehicle. Kits are available to secure transportables in a car by installing a permanent-mount cradle, similar to a mobile phone mounting.

Portables are the last category of cellular phones. The main differences between a transportable and portable are in weight, wattage, and price. Usually, a transportable is heavier, weighing 4.3 to nine lbs., while portables are lighter and small enough to fit in a briefcase. Secondly, a portable is a .6 watt phone, while transportables have a higher wattage capacity. Reception capability may vary near fringe areas of a cell site where reception decreases for lower wattage phones.

Available equipment options include: telephone number memory varying from a 30- to 101-number capacity; voice activation; auto-lock; automatic redial; call-forwarding; message service; busy or no-answer transfer; super-speed dialing; memory linking; and auto answer.

If a phone should have a verified failure while under warranty, the lessor would ship a replacement unit overnight via air courier and electronically switch the failed unit's phone number to the replacement unit. "This feature of the program solves the time delays that occur during a normal warranty transaction," says Burns. Typical turnaround for a normal warranty repair is three to eight weeks.

All cellular phones carry a three-year unlimited warranty for parts and labor. If the phone fails during this three-year warranty, the replacement unit would carry a new three-year warranty, not an extension of the earlier warranty.

Wheels has formed a separate department responsible for implementing its cellular program. A field sales staff, independent of the lessor's vehicle leasing staff, was formed to market the cellular service to fleet managers. The cellular sales staff reports to Burns.

"Wheels assessment of the fleet market potential for cellular services is that it has similar potential as the leasing business had 30 years ago," says Burns. "By 1995, we will be amazed to see the number of cellular phones in use and their productivity impact on company sales and service personnel, not to mention their wide variety of applications incorporating other electronic support devices."