Owner operators get to be their own boss and enjoy all the freedoms that come with that, but there are unique challenges that come along with it, as well. Freight factoring and the other services many factoring companies provide their customers can help owner operators manage many of the challenges they face.
Here, we’ll break down some of the most common challenges owner operators face and how freight factoring can help them mitigate them.
Freight Market Volatility
The freight market is notoriously volatile. From economic impacts to typical seasonal fluctuations, freight prices are constantly on the move. When capacity is tight and there’s plenty of freight, those fluctuations can be great for owner operators who can command higher rates, but when there’s more capacity than there is freight, low rates can make it difficult to make ends meet.
How Factoring Helps:
Freight factoring can help owner operators cope with market volatility in a variety of ways. For one, factoring helps maintain cash flow, which is even more important when money is tight and the market is uncertain.
Freight factoring companies may also be able to offer access to technology that can help owner operators stay on top of the market, providing the data they need to make smarter business decisions. Express Freight Finance’s MarketFit tool offers easy-to-read, real-time lane data with load board integration to help owner operators find the right opportunities for their business. Call us at 877.697.0605 to learn more about MarketFit.
Express Freight Finance also offers access to load boards, TMS systems, and other technology that can help owner operators get the business they need to weather freight market storms.
Fuel Prices
Fuel makes up a good portion of the average owner operator’s expenses to keep their trucks on the road. Fuel prices rarely stay steady for long, and sometimes the freight market doesn’t necessarily keep up with ever-changing diesel prices. This leaves owner operators bringing in less money per mile when you consider the fuel expenses.
How Factoring Helps:
On top of helping maintain steady cash flow, factoring can help owner operators cope with high fuel prices through fuel card programs or fuel advances. Express Freight Finance’s fuel card program offers discounts on fuel at more than 6,800 truck stops across the country, making it easy to fuel up and save money at the same time.
Repair and Maintenance Costs
Regular maintenance is critical to keeping trucks moving and maintaining their value, and repairs are inevitable. Critical as they are to operations, repair and maintenance expenses can be a hit to the budget, especially when it comes to breakdowns that create missed opportunities.
How Factoring Helps:
Freight factoring helps owner operators cope with repair and maintenance costs by helping maintain cash flow. Express Freight Finance also offers discounts on maintenance items through their fuel card program as well as equipment leasing services when older equipment simply isn’t cost-efficient to operate any longer.
Managing a Business While Driving
Sometimes, running a trucking business while chasing the white lines isn’t easy. There’s a lot to do, and some of it is difficult to accomplish from the road. Many owner operators handle finding loads, all the paperwork that comes with them, accounting, collections, and all the other tasks involved in running a trucking business while also driving.
How Factoring Helps:
Freight factoring services can take some of the administrative duties off an owner operator’s shoulders, allowing them to get paid quickly and easily without chasing shippers around and asking them to pay their invoices.DropPay by Express Freight Finance makes it easier than ever to get paid fast from the road. Simply submit proof of delivery through the user-friendly app and receive your money instantly, anytime day or night. Learn more about DropPay here or call us at 855.DROP.PAY to get started.
Maintaining Cash Flow
Cash flow is critical for owner operators to keep their trucks moving so that they can continue to keep money coming in. The scale of an owner operator’s business tends to be small, so issues like unpaid invoices can have a dramatic and immediate impact.
How Factoring Helps:
For small trucking companies and owner operators, factoring can help maintain cash flow by paying out invoices fast so they don’t have to wait on net-30 or net-60 payment terms to receive money for the loads they’ve completed.By getting paid quickly for loads, money going out in the form of expenses (fuel, maintenance, etc.) flows right back into the business, providing steady cash flow that can help stabilize the budget, giving owner operators the chance to grow their business and thrive.
Conclusion
Factoring services can help owner operators overcome many of the challenges they face as a small business in the trucking industry. By providing technology to help them operate more efficiently and effectively, helping keep expenses down, minimizing administrative duties, and promoting steady cash flow, freight factoring can be a recipe for success for ambitious owner operators.
