What Truckers Like About Top Trucking Companies
Though often overlooked, the trucking industry is vitally important to the health for 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 a 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 chore. But for small to mid-size companies operating on a good budget, it might stop an option. Expenses with regard to example payroll and gas come 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 this is a recipe for financial hardship.
Therefore, trucking companies often have flip to outside a mortgage. The following are some options for 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, the client gets 80-90% of your cash back immediately from the statements. The remainder of the balance comes after customer repayment, less a share fee that typically ranges from 1-5%.
This choices are best for B2B companies that cannot afford to wait for payment, and the cost is usually 4-5% monthly with a powerful annual price typically between 18-30%.
Bank Loans
Though hard to come by, bank loans are an cheapest involving financing. The loan process involves an application and review of the company’s creditworthiness and financial track record. Small companies especially tend to be rejected for loans, although exceptions do exist.
After approval, fund disbursement usually takes about 30-90 days to achieve a trucking company’s bank account. This form of funding is better for trucking outfits along with a great credit ratings and don’t need the money immediately.
Cash-Advances
Cash advances take place when an organization receives an advance sum from a lender. They pays loan provider back with percentages regarding their monthly card receipts up to the loan (plus a predetermined rate) is repaid. There are a bunch legal limits to the rates, which cannot be changed retroactively. The help cash advances is immediate cash- is certainly the fastest method for obtaining cash without in order to a loan shark.
This financing method is the for trucking companies who require immediate cash for any amount your own time and have limited financing options. Costly is usually 20% or more.
Lease-Back
A trucking company may wish to sell property, plant, and/or equipment, and simultaneously leases it back for resources.
It is best for trucking companies with valuable plant or equipment assets which have been underutilized, along with the cost is monthly lease payments not to mention the depreciation and tax burdens of tools.
Choices, Choices
Every trucking company is unique, that’s why it is close to them to search out funding solutions that meet their individual needs. Being informed on all possibilities is customers step toward finding a fitting cash flow solution.
4 Global Corp
12963 W Okeechobee Rd suite 4, Hialeah Gardens, FL 33018
(305) 912-9444
