At first blush, FAVR (Fixed and Variable Rate) programs can appear to be simple. “F” is for fixed costs for business use of employee-owned vehicles, for example insurance and licensing. “V” is for variable expenses such as the relative cost of living in a given geographical region and fluctuating gas prices, which have been remarkable in the past few months.
But you can’t judge a book by its cover, as they say, and you can’t evaluate a FAVR program by those two dimensions alone. From our point of view, you might add an “O” at the end of the acronym – O for options.
Just a Few Options You’ll Have with FAVR and Cardata
• Employees have Vehicle Choice– Company cars are mostly a perk of the past. In today’s current workforce employees want choice, one of the ways Cardata offers that is through our FAVR program. A FAVR program gives drivers both the ability to choose a vehicle that they need to have for work and want to drive when they’re not working. And employees keep the equity in their vehicles.
• Companies choose the Vehicle Profiles – By selecting vehicle profiles that govern the program and reimbursements, the company has choice. Select the vehicle that best fits the needs of the business. This Vehicle Profile is what the reimbursements are based on. This means the functional needs of the vehicle are chosen by the company. The employee can drive their preferred vehicle but the company does not pay for that choice, but rather what the vehicle the business needs. This is a cool way to control costs.
• Mileage Bands – The beauty of mileage bands is that companies pay for what they use. A driver with low mileage will have less depreciation on their car, so less is reimbursed in the fixed portion of the monthly reimbursement. Cardata has mileage bands of 5,000 to 50,000+ and adjusts them as needed according to actual miles driven each year.
• Tracking Options – Paper based mileage logging and reporting is a dated and inconsistent. The Cardata mobile mileage tracking app, offers an automated, accurate, and seamless option. We’ve seen customers save significantly because of improved data, and the convenience allows drivers to do their job, while the app takes care of mileage. You can get the details in our post Cardata Mobile – Your Way.
• Program Management – A big advantage of outsourcing your VRP is shedding the program management and administration burden. You can delegate as much of the duties as you want to us, from on-boarding new drivers, answering questions on the program and technology platform, calculating and validating monthly payments to paying drivers via electronic funds transfer. It’s up to you.
What Does Your FAVR Program Look Like? – Great question, one that we can answer by discussing your business operations and how components of FAVRs can be tailored to help you save resources and fairly reimburse employees.
It starts with getting in touch with us. Click the link below to schedule your demo. We’ll be happy to outline a plan covering all the points above as well as eligibility, insurance and licensing details, and potential cost savings.
About Cardata: Cardata provides vehicle reimbursement programs for the mobile workforce. Cardata services save money, reduce risk, and remove administration. Cardata programs are compliant with the IRS and the CRA.