Small trucking companies need to maintain healthy cash flow to thrive and grow. While positive cash flow is essential to carriers of all sizes, any lag in revenue can result in small trucking companies being unable to pay bills, make payroll, or keep trucks fueled. Fortunately, there is a way for smaller carriers to keep a positive cash flow to cover expenses and grow operations.
Loans and Small Trucking Companies
Loans are often thought of as the “go to” solution when businesses need extra financing. But for small trucking companies with cash flow concerns, loans can do more harm than good. Traditional loans can temporarily smooth over revenue cycles during the lag between client payments. Loans impact credit ratings and place debt on the books. This means that the monthly installments on the balance owed will eat into revenue, and gaps in cash flow due to staggered receivables can result in fines or even defaulting on the terms of the loan agreement. Similarly, if cash flow issues are recurring, taking out loans to correct the situation can lead to a precarious financial situation.
Rightsizing Cash Flow for Small Trucking Companies
To smooth over revenue cycles without taking on debt or lowering credit ratings, small trucking companies use freight bill factoring. Freight bill factoring eliminates the lag between client payments by turning unpaid receivables into cash within 24 hours. Factoring is not based on the credit ratings of your trucking company, and doesn’t place any debt on the balance sheet. When small trucking companies use factoring, they can resolve cash flow issues, cover overhead and payroll, and build up capital to grow their operations. Freight bill factoring can be arranged quickly for trucking companies of all sizes so they can access funds in a single day after submitting their receivables.
Boost Your Cash Flow Today
Express Freight Finance specializes in factoring services for the trucking industry. We provide comprehensive and transparent freight bill factoring for trucking companies of all sizes, nationwide. If you want to boost cash flow for your trucking company and reduce your need for loans, contact the team at Express Freight Finance today.