As with many sectors in the economy, the last few months of the year are critical for trucking companies. The revenue generated from October until the end of January allows trucking companies to make plans for 2020, or to reinvest a portion of the capital to upgrade equipment, hire drivers, or expand operations into new markets. However, trucking companies need to access that revenue quickly in order to act on time-sensitive plans.
Accessing Year End Revenue
Trucking companies issue invoices with staggered payment schedules ranging from 30 days on up to 90 days. Once a shipment is made, clients must make payments on those receivables within the time frame on the invoice. Unfortunately, staggered payment schedules can cause a gap in cash flow for trucking companies. Jobs completed in November or December may not be paid until January or February of the following year. Trucking companies need to access year end revenue as soon as possible to act on plans, instead of waiting for a staggered trickle of payments.
Speeding Up Cash Flow for Trucking Companies
Instead of waiting for months, trucking companies need a way to speed up cash flow and revenue on unpaid invoices. The most reliable method to reduce waiting time on payments is to use freight factoring. Freight factoring takes unpaid invoices with staggered payment schedules and converts them to cash within 24 hours. In addition to streamlining accounting, freight factoring also allows trucking companies to access revenue quickly. This means trucking companies can get a better idea of their financial position as the year comes to a close, so they can act on plans at the start of 2020. Additionally, freight factoring also allows trucking companies to close any gaps in cash flow so they can cover overhead and accumulate growth capital.
Express Freight Finance is the national leader in freight factoring services, helping trucking companies of all sizes increase cash flow by giving them fast access to revenue. We also provide a number of tools that trucking companies can use to manage their accounts and even check the credit standing of their clients. Contact Express Freight Finance today and stop waiting until after 2020 to get revenue from unpaid invoices.