Report: Fleet Management and Vehicle Reimbursement in the Food and Beverage Industry

Executive Summary

This report examines two models enabling work-related driving in the Food and Beverage (F&B) industry: fleet and vehicle reimbursement. Different roles require different solutions, particularly where specialized vehicles (e.g., refrigerated trucks) are necessary or, conversely, where personal vehicles suffice. The analysis covers thousands of F&B employees (merchandisers, sales reps, territory managers) and highlights how many F&B companies use Fixed and Variable Rate (FAVR) or Tax-Free Car Allowance (TFCA) to manage costs and compliance.

• Key Data (Overall F&B):
  • 86% use FAVR; 14% TFCA
  • ~1,475 miles/month driven
  • 89.5 trips/month
  • $647.84 average monthly reimbursement (includes $398.71 fixed, $0.19 CPM)

A specialized vehicle can be critical if a role requires temperature control or large-volume transport. However, many roles (e.g., sales, merchandising) can reduce overhead by up to 30% via a reimbursement program rather than a large fleet.

Industry Snapshot and Trends

Geographic Footprint

F&B drivers are concentrated in California, Texas, Mississippi, Florida, Kentucky, Illinois, Pennsylvania, North Carolina, Virginia, Mississippi, Washington, Wisconsin, and Georgia. Local regulations, fuel prices, and insurance rates vary widely, prompting location-specific adaptations. FAVR and TFCA programs can be designed, in conjunction with a reimbursement partner, with local data as a basis, meaning drivers in each state get relevant reimbursement rates. 

The Vital Role of Fleet Management

The perishable nature of F&B products demands swift, reliable transport. Delays risk spoilage, financial loss, and brand damage. Coupled with strict safety rules, effective fleet management becomes vital. However, not all roles need specialized vehicles. Many employees and use cases are well-served by vehicle reimbursement for personal vehicles, especially for lighter loads or sales activities.

Fleet vs. Vehicle Reimbursement in F&B

When Fleets Are Essential

Refrigerated trucks or cargo vans are needed for perishable products (e.g., meats, dairy) or bulk loads (e.g., pallets of beverages). Tractor-trailers handle massive shipments over long distances.

When VRPs Are Cost-Effective

Roles without large or temperature-sensitive loads often benefit from a Vehicle Reimbursement Program (VRP), avoiding high fleet ownership costs. FAVR is often tax-advantaged (per IRS) for both employer and employee.

Finding the Right Mix

Over-fleeting wastes resources if specialized vehicles exceed real needs. Conversely, using personal cars for tasks that truly require refrigerated or larger vehicles creates compliance risks. A careful audit of job functions is crucial.

Safety, Compliance, and MVR Checks

Whether using fleet or personal vehicles, maintain driver safety and compliance. Fleets require regular maintenance, temperature monitoring, and telematics; reimbursement participants must have adequate insurance and safe driving records. Motor Vehicle Record (MVR) checks and safety training catch issues (e.g., license suspensions) faster than annual reviews.

Read more: The importance of continuous driver record monitoring  | Cardata 

Sustainability Considerations

Sustainability goals push some F&B fleets to adopt electric or hybrid solutions for shorter routes, while employees may also choose fuel-efficient vehicles. Incentives at federal or state levels can help offset these costs. However, as the US government reorients its policies, the sustainability landscape may change. 

Cost-Benefit Audit

Balancing product quality, cost, and regulatory standards is key. Analyzing transport needs—load size, frequency, required equipment—clarifies which roles demand specialized vehicles and which can rely on VRPs.

Read more: Optimizing Vehicle Mobility in the Food and Beverage Industry | Cardata 

Embracing Vehicle Reimbursement Programs

To limit fleet ownership costs, many F&B companies shift vehicle ownership to employees. This eliminates certain expenses (leasing, maintenance, depreciation) while still providing business transportation.

FAVR reimburses employees for their actual fixed and variable vehicle costs, adhering to local conditions. CPM is simpler—paying per mile—but less precise. A well-structured program cuts overhead, particularly for roles not needing specialized equipment.

For instance, at $0.19/mile and ~1,475 miles/month, a driver would receive about $280 for mileage plus a fixed rate. This approach streamlines budgeting for both employer and employee.

Read more: Scaling Slowly: Fleet Management and Partial Transitions to VRPs | Cardata

A Closer Look at FAVR and TFCA

Fixed and Variable Rate (FAVR)

FAVR divides costs into:

1. Fixed Expenses (insurance, registration, depreciation).
2. Variable Expenses (fuel, maintenance, tires).

A fixed stipend covers predictable costs (the costs to “put a car on your driveway”), while CPM reimburses operating expenses. The advantages of FAVR include high accuracy, local cost adjustments, and significant potential tax benefits insofar as FAVR can be tax-free, even above the IRS standard rate. The disadvantage is administrative complexity, since FAVR has the following compliance requirements:

• There must be a minimum of five drivers on the program
• All drivers on the program must cover 5,000 miles minimum per year
• Driver insurance must be equal to the reimbursed insurance on the program, and must be verified
• The cost of driver vehicles, when new, must equal 90% of the program standard vehicle cost
• The program standard vehicle must cost less than $61,200
• Vehicles must adhere to the program retention cycle for depreciation reimbursement, and this cycle cannot exceed seven years

For these reasons, it is best to retain a vehicle reimbursement partner when administering FAVR programs, otherwise your program may fall out of compliance and you and your drivers may be subject to tax. 

Tax Advantages of FAVR | Cardata

Tax-Free Car Allowance (TFCA)

TFCA provides a flexible reimbursement system, allowing for fixed and/or variable reimbursements, up to the IRS standard rate, tax-free if business miles are properly recorded.

TFCA offers simpler administration, still tax-free if within IRS parameters, and not subject to the aforementioned compliance requirements of FAVR. There is only one rule for TFCA: you must compare the reimbursement total, divided by an employee’s mileage, to the prevailing IRS standard rate (70¢ per mile in 2025), to determine taxability. Only the delta is taxable.

Read more: Taxable Income Test Defined | FAVR Glossary | Cardata 

Program Design Considerations

Crafting the Optimal Fleet Strategy

Weigh leasing vs. owning or consider reimbursement for non-specialty roles. Leasing offers modern fleets but may carry high long-term costs and usage constraints. Owning can be expensive to purchase and maintain. Shifting ownership to employees through VRPs cuts acquisition and depreciation costs.

Preventive maintenance is crucial. Regular vehicle checks avert breakdowns, extend vehicle life, and reduce emergency repair costs.

Tips to Improve Fleet Management | Cardata

Key Insight: Assign specialized trucks (refrigerated, cargo) only to roles that truly need them while relying on VRPs for others, minimizing “over-fleeting.”

Implementing Efficient Vehicle Reimbursement Programs

FAVR blends fixed ownership costs with a variable mileage component, offering tax-free benefits if properly structured. Companies may also choose to implement a CPM program, which pays per mile without dissecting costs but may not account for local price differences.

TFCA is an option if simplicity is more important than pinpoint accuracy. Some companies blend these approaches, creating hybrid models. Moreover, when drivers fall out of compliance on FAVR, they can be treated as receiving reimbursement under a TFCA model—for this reason, it is again best to retain a vehicle reimbursement partner, like Cardata, in order to ensure a seamless transition between the two programs, when required. 

Cost Example: The average monthly F&B reimbursement is $647.84, including a $398.71 fixed component plus per-mile compensation.

Mileage Reimbursement Programs | Cardata

Navigating Regulatory Compliance

Compliance with state regulations on vehicle registration, emissions, and safety is essential, whether you have company or employee owned fleets. Non-compliance may incur fines, legal issues, and disruptions. Staying informed and documenting properly are crucial.

In F&B hotspots (e.g., California, Texas, Mississippi), local tax laws can affect how reimbursements are administered. Safety is equally crucial. VRP participants must have adequate insurance; real-time MVR checks help mitigate risks.

Leveraging Technology Integration

Technology can cut operational costs and provide data insights:

• Fleet Automation: Schedules, maintenance tracking, telematics.
• Mileage Tracking Apps: Ensures IRS compliance, saves time.
• Advanced Fleet Software: Real-time tracking, driver behavior monitoring, analytics for route optimization.

Telematics and other fleet vehicle management software on specialty trucks (e.g., refrigerated units) can ensure a variety of controls and compliance measures, and help better understand and improve driving habits. 

Implementation Steps

1. Assess Current Fleet Operations: Identify costs, efficiency, and compliance status to pinpoint areas needing improvement.
2. Select an Appropriate Reimbursement Program: Align FAVR, CPM, TFCA, or hybrid models with mileage patterns, admin capacity, and tax impacts.
3. Establish Preventive Maintenance Schedules: Proactive maintenance extends vehicle life and promotes safety.
4. Integrate Technology Solutions: Use fleet software and mileage apps for automation, real-time data, and accurate reimbursements.
5. Ensure Regulatory Compliance: Stay current with regulations and IRS guidelines. Document consistently to maintain tax-free reimbursement status. Retain a reimbursement partner or fleet management partner to guarantee the same.

Segmentation Tip:

• Specialty Needs (temperature control or large cargo) justify fleet vehicles.
• VRP Roles are better for tasks involving sales visits or minimal cargo.

Common Pitfalls to Avoid

Ignoring regulatory requirements can lead to significant risks, including fines, legal trouble, and payroll tax issues. Additionally, overlooking the total cost of ownership by failing to account for expenses such as fuel, maintenance, and depreciation can result in unexpected budgeting challenges. Inadequate driver training not only increases the likelihood of accidents but also raises insurance costs. Furthermore, neglecting technology means missing valuable opportunities to streamline operations, reduce manual work, and minimize errors.

Reporting Car Allowance | Cardata

Over-Fleeting & Misalignment:

Purchasing more specialized vehicles than necessary can lead to wasted resources and unnecessary expenses. Similarly, using personal cars for roles that require refrigeration or bulk transport can result in compliance issues and potential spoilage, compromising efficiency and regulatory adherence.

Resources and Tools

Program Selection

Vehicle reimbursement partners offer vehicle reimbursement programs that implement FAVR and other strategies to ensure compliance while optimizing costs. 

​​Which Vehicle Reimbursement Programs Are Right for You? | Cardata 

Software and solution selection

Vehicle reimbursement program software automates key processes such as mileage tracking, insurance verification, direct payments, program oversight, reporting, driver safety monitoring, and MVR checks, helping fleet managers save time and improve accuracy. 

Cardata’s Technology and Services 

Fleet management software

Additionally, fleet management platforms provide a data-driven approach to route optimization, driver oversight, and reporting, enabling more efficient and informed decision-making.

Conclusion

Effective fleet management and reimbursement strategies are strategic imperatives in F&B. By adopting best practices—aligning vehicle type to job requirements, maintaining regulatory compliance, and integrating smart technology—companies can slash costs while upholding quality and safety.

Embracing the right combination of fleet for specialized tasks and reimbursement for non-specialized roles strengthens profitability, competitiveness, and long-term success. This proactive approach demonstrates a commitment to efficiency, responsibility, and continuous improvement that benefits both businesses and employees.

Data Recap

• Sample Size (F&B): thousands of drivers
• FAVR Adoption: ~86%
• TFCA Adoption: ~14%
• Avg. Monthly CPM: $0.19
• Avg. Monthly Fixed Rate: $398.71
• Avg. Trips per Month: 89.5
• Avg. Monthly Mileage: 1,475.40
• Avg. Monthly Reimbursement: $647.84
• High Driver Concentration: CA, TX, MS, FL, KY, IL, PA, NC, VA, MS, WA, WI, GA

Appendix A: Alcoholic Beverage Manufacturing and Distribution (Beer, Wine, and Spirits)

This subsegment has unique mobility patterns:

• FAVR: ~54.5%
• TFCA: ~45.5%
• Avg. Monthly CPM: $0.11
• Avg. Monthly Fixed Rate: $450.36
• Avg. Trips/Month: 83.7
• Avg. Monthly Mileage: 1,026.26
• Avg. Monthly Reimbursement: $541.69

Compared with the overall F&B data (1,475 miles/month, $647.84 reimbursement), alcoholic beverage drivers log ~400 fewer miles and see lower CPM. Their TFCA usage is higher, likely due to lower mileage and simpler administrative needs. The fixed rate of $450.36 is higher than the overall $398.71, reflecting specialized insurance or licensing costs.

• Mileage & Vehicle Use: Shorter routes to bars, restaurants, or retail outlets.
• Reimbursement Method: Balanced split between FAVR and TFCA.
• Insurance/Regulatory: Alcohol licensing laws can add to insurance costs.
• Implications: Lower mileage makes TFCA viable, though specialized or branded vehicles may still be needed for promotional use.

In sum, Beer, Wine, and Spirits remains part of F&B but exhibits distinct reimbursement and operational patterns that must be factored into fleet strategy.

Appendix B: Comparisons with Construction and Chemical Industries

It is edifying to compare the Food and Beverage industry characteristics with those of the Chemical and Construction industries. Here are the differences and similarities:

Monthly Mileage

• F&B ~1,475 miles/month
• Construction ~615–692 (some up to ~885)
• Chemicals ~1,442

F&B drivers typically log more miles than Construction and slightly more than Chemicals.

Trip Frequency

• F&B: 89.5 trips/month
• Construction: 62–67 (some up to ~78)
• Chemicals: ~53

F&B sees higher trip frequency, aligning with frequent deliveries and restocking.

Monthly Reimbursement

• F&B: $647.84
• Construction: $507–$886
• Chemicals: $926.24

F&B’s reimbursement level is mid-range; Chemicals’ is higher on average.

Geographic Overlaps

• F&B: CA, TX, MS, FL, KY, IL, PA, NC, VA, MS, WA, WI, GA
• Construction: FL, TX, CA
• Chemicals: TX, OH, CA

Texas and California are key across all three, but Mississippi and Kentucky are more unique to F&B.

Choice of Reimbursement Method

• F&B: ~86% FAVR, ~14% TFCA
• Construction: ~76.1% TFCA, minority FAVR
• Chemicals: ~48.9% FAVR vs. 51.1% TFCA

F&B’s near-exclusive FAVR contrasts sharply with Construction’s reliance on TFCA.

References

[1] Food and Beverage Fleet Management | Geotab

[2] FOOD & BEVERAGE | Michelin B2B 

[3] Food & Beverage Fleet Management Solutions | Merchants Fleet