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Incentives Trucking Companies Use To give In Drivers

Though often overlooked, the trucking industry is essential to the health belonging to 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 huge concern. But for small to mid-size companies operating on a strong budget, it might not be an option. Expenses regarding payroll and gas add up in the time between payment, and not paying your drivers is never a good business repeat. 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 flip to outside funding. The following are some choices trucking companies to consider:

Asset-Based Lending

Also known as factoring, this options refers to the process 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 duration of the sale, customer gets 80-90% of your 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 choice is best for B2B firms that cannot afford to wait for payment, along with the cost is often 4-5% monthly with annual pace typically between 18-30%.

Bank Loans

Though hard to come by, bank loans are often the cheapest involving financing. Mortgage process involves an application and analysis of the company’s creditworthiness and financial reports. Small companies especially are more likely to be thrown to the wolves for loans, although exceptions do be available.

After approval, fund disbursement usually takes about 30-90 days achieve a trucking company’s banking. This form of funding is the for trucking outfits having a great credit file and don’t need the money immediately.

Cash-Advances

Cash advances take place when a company receives an advance sum from the lender. The company pays the lender back with percentages from their monthly card receipts just before loan (plus a predetermined rate) is repaid. Happen to be legal limits to the rates, and so they also cannot be changed retroactively. The benefits of cash advances is immediate cash- it is the fastest method for obtaining cash without in order to a loan shark.

This financing method ideal for trucking companies who need immediate cash for the short amount of this time and have limited financing options. Costly is usually 20% or more.

Lease-Back

A trucking company may want to sell property, plant, and/or equipment, and simultaneously leases it back for moola.

It ideal for for trucking companies with valuable plant or equipment assets which have been underutilized, and the cost is monthly lease payments plus the depreciation and tax burdens of tools.

Choices, Choices

Every trucking company is unique, that’s why it is close to them to locate funding solutions that meet their individual needs. Being informed on all possibilities is begin step toward finding a worthwhile cash flow solution.

4 Global Corp

12963 W Okeechobee Rd suite 4, Hialeah Gardens, FL 33018

(305) 912-9444

https://g.page/4global