What Truckers Like About Top Trucking Companies
Though often overlooked, the trucking industry is really important to the health on the US economy. Think about it: without truck drivers delivering goods, interstate commerce would grind to a screeching, tire-burning halt.
Unique Challenges
Despite the importance of trucking companies, the way the system is structured often leaves them in the shaky financial position. Truck companies submit invoices for services rendered, and then often wait 30-90 days for payment on the accounts receivables.
For a bigger company with large cash reserves, waiting to be paid would not be a problem. But for small to mid-size companies operating on a strong budget, it might ‘t be an option. Expenses like payroll and gas calculate in the time between payment, and not paying your drivers is never a good business put into practice. Add to that rising fuel costs, delays due to traffic congestion, driver shortages and new regulations, and is definitely a recipe for financial hardship.
Therefore, trucking companies often have to show to outside a mortgage. The following are some methods trucking companies to consider:
Asset-Based Lending
Also known as factoring, this options refers to difficult . by which businesses sell their accounts receivables to a factoring company. Approval for factoring is founded on on the creditworthiness of the trucking company’s customers.
At the use of the sale, customer gets 80-90% of the cash back immediately from the statements. The remainder of the balance comes after customer repayment, less a portion fee that typically ranges from 1-5%.
This choices are best for B2B firms that cannot manage to wait for payment, as well as the cost is usually 4-5% monthly with an impressive annual fee typically between 18-30%.
Bank Loans
Though in order to come by, bank loans are these cheapest associated with financing. The loan process involves an application and breakdown of the company’s creditworthiness and financial reports. Small companies especially will usually be turned down for loans, although exceptions do be around.
After approval, fund disbursement usually takes about 30-90 days attain a trucking company’s banking. This form of funding ideal for for trucking outfits using a great credit ratings and do not require the money immediately.
Cash-Advances
Cash advances take place when a small-business receives a loan sum from our lender. The corporate pays loan provider back with percentages of their monthly card receipts prior to loan (plus a predetermined rate) is repaid. Undoubtedly are a legal limits to the rates, and they will cannot be changed retroactively. The benefit to cash advances is immediate cash- the time the fastest method for obtaining cash without gonna be a loan shark.
This financing method very best for trucking companies who need immediate cash for any amount associated with your and have limited financing options. Zox pro training system is usually 20% if not more.
Lease-Back
A trucking company could sell property, plant, and/or equipment, and simultaneously leases it back for resources.
It ideal for for trucking companies with valuable plant or equipment assets which have been underutilized, as well as the cost is monthly lease payments as well as the depreciation and tax burdens of equipment.
Choices, Choices
Every trucking company is unique, and in addition it is close to them inside your funding solutions that meet their individual needs. Being informed on all your options is begin step toward finding a fitting cash flow solution.
4 Global Corp
12963 W Okeechobee Rd suite 4, Hialeah Gardens, FL 33018
(305) 912-9444
