The majority of the trucking and transportation industry has been operating on legacy technology for longer than most owners would care to admit. This is true across the three major sectors — shippers, brokers, and carriers — and each suffers from the same lack of ability to capture big data and communicate it across a network of systems. Human interaction remains the predominate means of relayed communication, which results not only in wasted time, but also leads to poor routing and bad pricing. However, in recent years a number of technological advances have been in development and they are changing the trucking and transportation landscape in several key ways.
Electronic Logging Devices
As of December 18th 2017, it became mandatory for almost all US trucks to carry an ELD (electronic logging device). The reason for this is to create a working environment that is both safe and compliant for drivers. It records and tracks the driver’s ROD status and also monitors each driver’s hours of service.
Telematics and fleet tracking systems
Telematics generally refers to the collection and integration of telecommunications. In the trucking and transportation industry, it refers to the sending and storing of information relating to a fleet of trucks. With the integration of GPS, a telematics system can provide an auto-generated report that tracks the status of vehicles within a fleet, giving fleet managers pertinent details on when the vehicle starts, shuts down, when it idles, as well as its location and speed. All of this information combined allows for optimization of routes and driver behavior.
It’s no doubt that technology leaders will continue to develop more and more modern software that will allow for increased efficiency in fleet management. These changes can be difficult and costly for carriers, but change is essential in the battle for survival in the fast-paced and demanding transportation industry. For trucking companies, this means hedging the inherent risks of the industry with healthy cash flow.
When it comes to financing, truck company owners often find it difficult to secure funding, as conventional lenders like commercial banks are notoriously reluctant to extend credit to the majority of small and medium size trucking companies — as these entities often carry what banks deem to be an overabundance of risk. This leaves the common trucking business owner to seek out an alternate method of funding their day-to-day operations and financing their business growth.
Transportation factoring is a cash advance funding arrangement that has become mainstream in the trucking industry. By partnering with a third-party factoring company, you can sell your invoices at face value (minus a small factoring fee, and 3% of the value held in reserve). When the factor collects from the customer, the 3% is returned to you. This process provides immediate funding to handle overhead and operational expenses.
If you want to get paid faster and stop waiting for your invoices to clear, a factoring partner like Accutrac Capital, for example, can help owners secure same-day funding through a variety of plans custom-tailored to the trucking industry. These include:
Flat Fee Factoring
- From 1.59% for up to 90 Days
- This is a simple, easy to manage option with an easy to calculate one-time cost
- From as low as 0.49% for 10 days
- An ideal funding option for carriers with quick paying customers
Factoring Line of Credit
- Designed for larger fleets and operations
- From as low as 0.022% per day
- A flexible line of credit providing maximum control and value for large fleets
If you’re looking for a reliable, mainstream way to finance a growing carrier or freight brokerage business, consider selling outstanding invoices at a discount through invoice factoring. Because some customers take two to three months to pay, many carriers need immediate funding to maintain steady cash flow, and transportation factoring solves that problem quickly, efficiently, and hassle-free.