The great recession of 2009 is long past, and the economy has been slowly recovering by fits and starts over the last eight years. 2016 began with a weak demand on capacity, but luckily for owners of trucking companies, by mid-2016 there was a steady climb in load to truck ratios for vans, flatbeds, as well as reefers. This has many experts in agreement that 2018 will mark the beginning of a stretch from growing demand on trucking capacity that should last a good 4 to 5 years.
This means that trucking (an industry that often deals with low freight volumes as well as diminishing rates and increased government regulations) should see some growth and remain profitable during a difficult economic era. Of course, as opportunity grows, other hidden costs and hurdles present themselves. Trucking companies are constantly dealing with driver shortage, fuel increases, and the rising cost of overhead – whether that’s office rentals or simply the cost of keeping a fleet on the road. This is why so many trucking company owners are turning to freight factoring to help keep cash flow in the green, staying on top of rising costs, and keep drivers behind the wheel.
While the freight transportation industry employs one of the largest workforces in the US, anyone who owns a trucking company will tell you that there is a massive driver shortage that continues to be a growing issue. Analysts and experts predict that the driver shortage will grow as we move into the next decade. This is because as the aging workforce (the average truck driver is 50 years old) retires, the driver shortage is expected to continue to grow at a dramatic pace.
Insuring reliable wages is one of the major ways to keep drivers employed and to keep your freight arriving on time. Guaranteed wages combined with industrywide implementation of benefits and other incentives mean a higher quality of life for professional drivers, which translates into more drivers overall. In order to support this kind of positive work environment, trucking companies require access to working capital at all times.
For most US trucking companies, typical cash flow management involves a commercial operating line of credit. However, the restrictive policies of a traditional bank prevents many trucking companies from qualifying for a commercial loan. Fortunately there’s a solution. A freight factoring company like Accutrac Capital can help you secure a line of credit equal to up to 97% of your combined accounts receivable that you can draw upon as the need arises.
As the owner of a trucking company, you only need to worry about paying fees on funds drawn – on top of a modest administrative fee to help you manage your accounts receivable. Stop by Accutrac Capital to learn more about the myriad benefits on offer including:
- Same day funding
- A factoring rate of 0.022% (Prime plus 5% per annum)
- Cash advances up to 97% of your combined Accounts Receivable
- Fees paid solely on cash drawn
- 24/7 access to your online account
Cash flow management can be difficult balancing act for trucking companies of any size – but of course the smaller the business the harder it is to keep payroll in the green week after week, month after month. Having a strong financial strategy in place that includes freight factoring insures that you keep your cash flow above board and your drivers behind the wheel.