Small trucking companies bridge the gap between large fleets and customers. Small trucking companies are able to offer last mile services and adapt to the rise of e-commerce, plus they are able to take on part of the burden during shipping crunches, as we saw in the second half of 2018. Additionally, small trucking companies serve small businesses and strengthen local economies across the country. As the market for small trucking companies steadily grows, their owners find themselves in need of working capital and improved cash flow. Instead of taking out loans and placing debt on the books, small trucking companies are using freight load financing.
Freight Load Financing and Cash Flow
Cash flow is essential to the success of any trucking company, regardless of size. Fuel, vehicles, equipment, employees, advertising, facilities, insurance, and more, take a lot out of revenue on a daily, weekly, and monthly basis. Yet with receivables on 30, 60, and 90-day payment schedules, small trucking companies often experience periods when more cash is going out of the bank account than coming in. Freight load financing unlocks the revenue that’s tied up in unpaid receivables. When an invoice is generated, it gets submitted for freight load financing, and then it is converted to cash. The entire process takes about 24 hours, which is much faster than waiting a month or longer for clients to make payments. Freight load factoring allows trucking companies of all sizes to boost cash flow so they can cover overhead expenses and start accumulating growth capital.
Avoiding Debt and Preserving Credit Ratings
Using short-term loans to correct cash flow issues impacts credit ratings and places debt on the balance sheet. If the issues are recurring due to expenses and long waiting times for client payments, those short-term loans can dig a deep financial hole. Freight load financing, by contrast, is debt-free. The exchange is fast, simple, and transparent, so small trucking companies can avoid taking on liabilities and preserve their credit ratings, while getting fast access to their revenue.
Express Freight Finance provides the most comprehensive freight load financing program for small trucking companies throughout the United States. Contact our team today to supercharge your cash flow without loans.