Small trucking businesses are experiencing many of the same headaches as the big fleets. Driver shortages, working capital, legislative compliance, and more are being felt by small trucking businesses. However, there are a few ways to deal with the major obstacles to ensure long-term success.
Driver Shortages in Small Trucking Businesses
The driver shortage impacts trucking companies of all sizes. Sure, when a big fleet is down five people, that places a bigger strain on the rest of the company. When a small trucking company is down by five drivers, it could cost entire client accounts. However, small trucking businesses have more leeway to change their payment structure compared to large fleets. Between limited hours of service and a rate of pay that hasn’t kept up with the cost of living, drivers are currently taking home less. Restructuring pay will encourage more long-term hires and reduce driver turnover.
Currently, small trucking businesses are working with the big fleets to offload some of the burdens of deliveries. Clients are looking for capacity trucks. Some companies are offering “white glove” or “last mile” services. To ensure there are drivers available, smaller companies have started offering mileage rates or a percentage of the load. This is nothing new, but smaller companies are going one step beyond by offering guaranteed minimums. Without minimums in place, some drivers can actually lose money on a haul.
Keep Lines of Communication Open
Small trucking companies are very well of their limitations. Clients know what they need. Small trucking companies cannot just accept client orders to increase their bottom line if the driver capacity isn’t present to move the goods. From the drivers to the trucking company owners to the clients, lines of communication need to be open to ensure no one is being overburdened or that people aren’t making promises that can’t be delivered.
Speeding Up Revenue
Smaller trucking companies need a way to speed up revenue tied up in unpaid invoices. Improved cash flow allows smaller companies to cover overhead expenses, offer better pay rates for hiring, and grow into new markets. Freight load factoring converts unpaid invoices to cash in a single business day, so trucking companies don’t have to wait a month or longer to see the revenue they worked so hard to get.
Express Freight Finance is a national leader in factoring services for the trucking industry. Contact our offices