Trucks do not run without fuel. Truck fleets do not run without cash. Cash is the fuel that drives fleet operations. Successful trucking companies require consistent, dependable cash flow. Waiting for customer payments is a drain on cash flow and puts a company at risk.
Freight factoring is a good solution for trucking companies in need of reliable cash flow. The following example shows how freight factoring with Scale Funding improved the cash flow and overall operation for a trucking company.
Sharon is the owner of a ten truck fleet. She had just secured a new dedicated lane, and business was looking up for her. She leased two trucks and hired new drivers so she could service the new contract. After a couple of weeks, Sharon was having cash-flow issues. The additional fuel and payroll expenses related to the new work were greater than the incoming payments from her customers.
Within a month, Sharon maxed out her line of credit with her bank. She requested a credit line increase but was declined. Sharon started dipping into her savings to make ends meet but knew that wasn’t the long-term answer.
On the advice of the owner of another fleet, Sharon looked into freight factoring. She did an online search for freight factoring companies and contacted a number of them for information. Sharon chooses freight factoring with Scale Funding, based on the low rate she was offered and the need to get her account set up and funded quickly. Scale Funding does not require long-term freight factoring contracts, so she was comfortable trying factoring.
For Sharon, getting her account set up was an easy task, and only took a couple days for Scale Funding to complete. With her first funding advance, Sharon’s bank line of credit was paid off, and she received enough money to cover her bills and invoices for the week.
As Sharon settled into a routine of freight factoring, her cash-flow issues have disappeared. Twice a week, Sharon’s billing clerk sends Scale Funding the new invoices from the completed loads. Scale Funding funds the invoices the same day they are received and the money is in Sharon’s bank account the next day. The consistent cash flow enables her to keep the trucks fueled, meet payroll each week, and effectively manage her expenses.
In addition to the cash flow from freight factoring, Sharon is benefiting from some additional services Scale Funding offers. Before booking loads from new customers, Sharon uses Scale Funding’s credit desk service to check the credit and payment history of the new customers. This gives Sharon valuable insight into the financial strength of the new customer and she uses this information to determine whether she will take the load or not. Also, because Scale Funding handles the collections on any past due invoices, Sharon’s time is freed up to manage other important parts of her business.
Freight factoring is the right choice for cash flow for trucking companies. With consistent cash flow, truck fleets continue to grow and prosper. For more information on improving cash flow with freight factoring, contact Scale Funding online, or call (800) 707-4845.