Category Archives: Invoice Factoring

Truck Driver Safety Tips

With an estimated 15.5 million trucks operating daily on roads in the United States, it’s important to keep your drivers safe (TruckingInfo.net). Training drivers to be safe and careful while delivering loads is key to growing your trucking business, as it can impact your company’s finances, fuel costs, and truck maintenance expenses.

Here are just a few of the trucking safety challenges for commercial drivers. Even if they seem routine or predictable, it’s important to make sure your drivers remember them.

Large Blind Spots

Limited visibility calls for extra caution in passing and being passed by other large vehicles on the road. Large trucks also need to maintain a longer following distance so they can see all of the vehicles behind them. Cars are often ignorant of the blind spots that trucks have, so it’s up to truck drivers to be vigilant about spotting where cars are moving. Extra side mirrors can be helpful in improving visibility.

Long Stopping Distance

Trucks traveling 65 miles per hour take up to two football fields to stop, so it’s important to have a ‘buffer zone’ in front to protect your drivers and your trucks. The more following distance in front of the truck, the more time drivers have to correct or slow down if other drivers cut in or stop suddenly.

Limited Maneuverability

The turning radius for a truck is 55 feet, so check for smaller vehicles that try to get by when you’re turning. Be aware of the impact a truck makes when accelerating, stopping, and maneuvering between lanes or making a turn. Slowing down significantly for curves and ramps is also a key point to remember – especially with a truck’s higher center of gravity.

Incentivize Safe Driving

To help ensure safe driving, many trucking companies offer small bonuses for driving without any speeding tickets or other citations for a certain period of time. By monitoring driving records – something you’re most certainly doing already – you can identify which drivers have earned bonuses or other rewards for their compliance.

The Financial Benefits of Safe Drivers

Training your drivers for better safety provides benefits not only for drivers, but for your trucking company’s finances.

Reduced incident rates decrease crash-related liability costs
Leveraging safety ratings to retain and hire more drivers
Better productivity by keeping drivers on the road
Lower insurance costs

Safe driving is good for your reputation, your finances, your drivers and their families. Additional FMCSA tips for CMV drivers can be found at: https://www.fmcsa.dot.gov/ourroads/tips-cmv-drivers.

3 Ways to Help Prevent Trucking Fraud

With the increase in use of digital technologies (many that we highlighted last month) unfortunately comes a surge of trucking fraud scams that are being run on companies.

One of the top swindles running rampant these days is deceptive soliciting. A person may call or send official-looking emails or letters posing as a representative from the Federal Motor Carrier Safety Administration. In these letters, they’ll claim to be citing you for various violations and associated fines. The scammers will usually do research on legitimate Department of Transportation regulations, so that their scams seem extremely real. They may ask you to pay extremely high fees, or demand that payment be made through specific wiring instructions. This should send up a red flag and prompt you to investigate the claim. This could be as easy as a call to the FMCSA.

Fraud Prevention for Trucking: What is Being Done?

The Federal Trade Commission has filed a number of lawsuits against companies who’ve scammed thousands of truckers with these deceptive practices. But unfortunately, there are still many people running this particular scam. Your basic carrier information is publically available when you submit an application or update your information with FMCSA. This can leave you open for these fraudulent companies to get your information and target you.

How You Can Avoid Scams:

Recognize imposters. Before you send any money or give out information in response to a request, contact the actual agency or business that the request has come from, to determine whether or not it is legitimate. You can also sign up for free scam alerts from the Federal Trade Commission at www.ftc.gov/scams. You can get great tips and advice about scams that are going on through these updates.
Know the rules. The FTC will never ask you for money. Also, the U.S. Government does not endorse private businesses or vendors, and the use of a service provider is NOT required by FMCSA. For example, one scam is designed to get trucking companies to sign up for their service claiming to easily pay your annual Unified Carrier Registration fees. However, their “service” will actually charge truckers for more payments and higher amounts than their actual fees should be for the year. Remember: you are NOT required to use third-party administrators to take care of your compliance fees.
Report fraudulent practices. You can help stop these deceitful practices and avoid becoming a victim of scammers who target truckers. File a complaint for any aggressive or misleading marketers to the Federal Trade Commission at www.FTC.gov/complaint. You can also report a fraudulent request for information to the Department of Transportation through the Office of Inspector General via https://www.oig.dot.gov/hotline.

For the health of your business, it’s important to become aware of the scams that plague the trucking industry. Check our Facebook and Instagramaccounts throughout the month to learn more about cons you want to avoid.

Trucking Technology: How to Grow My Trucking Company With the Latest Tech

After analyzing 2015 data, the Federal Motor Carrier Safety Administration reported decreases in both large truck injury crashes and large truck property damage crashes. One reason why these numbers are improving is because of new trucking technology.

Advanced collision mitigation systems, for example, have sensing technology to monitor for crashes and can take emergency action to avoid them. Using this technology can improve truck driver safety on the roads, but technology may also be used to help trucking companies when it comes to earning better profits for their business. You may want to consider some of the following ideas to determine if investing in technology in the trucking industry can help you grow your trucking company.

Trailer Tracking Trucking Technology

This type of system can offer real-time help with loss prevention, warning drivers of high-theft areas, and giving law enforcement data to recover stolen trailers. But it also provides companies the ability to look at the utilization and productivity of their trailers, to see whether or not they’re being maximized in use. The maintenance of trailers is another benefit to trailer tracking, as new systems can attach the maintenance data and records to a specific trailer, creating more consistent inspection plans for companies.

Dynamic Routing Technology

This technology aids efficiency by using real-time traffic and weather information to help drivers adjust to the best possible routes. This can increase profits by allowing trucks to use quicker routes, avoid major collisions, or detour around traffic congestion for more on-time deliveries. And of course, more efficient routes can mean better customer service and lower fuel costs.

While technology hasn’t completely solved many of the problems the industry faces, such as driver shortage and infrastructure issues, there are ways to use technology for your benefit. Taking the time to look at the latest options can help you determine what technologies might help your trucking business grow and succeed.

Throughout this month, our Instagram and Facebook posts will highlight additional technology advances, including transparent and efficient ways to bid for loads that match drivers’ availability and preferences. We’ll also take a look at other software developments that focus on better ways for truckers to make payments for fuel and freight transactions. Stay tuned to ACC on social media to learn more.

Unpaid Invoices: Learn to Collect

Everyone looks forward to pay day. Sadly, it can be very frustrating for small and medium sized trucking companies to deal with customers who don’t pay their invoices on time — or at all. If your trucking business is dealing with this issue, here are a number of ideas on how to collect unpaid invoices from customers and improve your invoicing process.

Take proactive steps prior to issuing invoices:

Establish both credit limits and payment terms with each customer before you begin working with them. Payment terms of 15, 30, 45, or 60 days are common.
Use a reliable invoicing system to track when invoices are issued, with automatic alerts that trigger when an invoice is past due.
Once an alert is received, establish a standard process for collection emails or phone calls to be made immediately.
Create a straightforward invoice format. Make sure each invoice clearly indicates the amount due including any detention time and lumpers, payment terms, load number, and where to send payment, so there is no misunderstanding.
Determine if you want to offer early payment incentives for customers who have been consistent in paying their invoices. Some companies will offer a small discount for payments within a certain number of days.

Issue accurate invoices systematically:

Issue the invoice to the customer as soon as a job is complete.
Select a specific date each month or day of the week for invoicing, so you don’t get sidetracked with other business.
Schedule follow up calls to confirm your invoices were received, and give customers a friendly reminder of when payment is due.

Collect on late payments efficiently:

Make calls to inquire about late payments, maintaining a calm and polite tone as you issue the request for immediate payment.
Establish procedures for when to involve a 3^rd party collection agency, and if the benefits are likely to outweigh the costs.
Establish credit terms for all customers, but be flexible enough to make term adjustments for customers who consistently pay late. If problems persist, it may be time to consider terminating future business with that particular customer.

As you establish consistent, effective invoicing and collection processes, your payments can be collected more efficiently to improve your cash flow. You may also consider using Advanced Commercial Capital’s non-recourse factoring service to get immediate payment for invoices. This ensures that collection efforts don’t become costly or interfere with your ability to run your business.

Positive Cash Flow For Truckers – The Fundamentals

positive cash flow for truckers

Trucking businesses have a lot of challenges when it comes to maintaining cash flow. You need to buy fuel, maintain equipment, and make payroll, all while trying to collect payments from customers – which doesn’t always happen on time. Finding ways to increase your cash flow isn’t easy, but there are several ways you can help keep it consistent and create positive cash flow for truckers.

Keep an Eye on Expenses

Whether you use accounting software or outsource to an accountant or bookkeeper, keeping a watchful eye on your financials can help you stay on top of your cash flow situation. The more accurate and up-to-date your accounting is, the more knowledge you’ll have of where money is being spent. You should be able to look at the numbers anytime – through your system or your accountant – and get an accurate picture of your financial situation. That knowledge can help you make the necessary adjustments to spending whenever needed.

Boost Your Income

Positive cash flow means your income exceeds expenditures at any given time. Aside from spending less, it obviously helps to have more money coming in. Consider what you can do to boost your numbers. For example, when was the last time you increased your prices? Are they comparable to what your competitors are charging? Consistent evaluation of your income and expenditures is the best way to find more cash flow.

Evaluate Your Equipment

Owning a single truck or a small fleet can be costly. Take time to audit the costs of your current vehicle situation. Are you able to pay a little more on your truck loans and pay them off faster? Are you thinking of expanding your fleet or purchasing new equipment? Weigh the cost of new equipment against what you’re paying to maintain what you have. Which is going to cost you less in the long run?

Use Non-Recourse Factoring

Most trucking companies have a similar pain – invoices not being collected in a timely manner – or sometimes not at all. Non-recourse invoice factoring means you get cash for invoices right away, giving you quicker access to the funds you need to pay for things like fuel and payroll, without worrying about collecting on invoices that may go unpaid. This can help ensure positive cash flow while you pay monthly bills and work on future growth.

Positive Cash Flow for Truckers: Create a Plan With Advanced Commercial Capital

Practicing sound cash flow fundamentals, your trucking business can meet its commitments both now and in the future.

What is Double Brokering Freight?

One of the worst things that can happen to your trucking company is to get scammed. Whether it’s a vendor, customer, or strategic partner, scams can bite you and your business right where it hurts – in the pocketbook.

What is Double Brokering Freight?

Double brokering is exactly what the phrase implies – a load that has been brokered twice. One of the most common fraudulent activities being perpetrated on truckers today is Fuel Advance Fraud, which is a form of ‘double brokering.’ This is when a fraudulent broker passes themselves off as a legitimate carrier, accepting freight from an unsuspecting broker or agent.

double brokering freight to avoid trucking scams

In many cases, the fraudulent broker signs up for a load that another broker has posted on a load board. Then, they re-post that load at a higher amount and hire a carrier to take the load – and take a fuel advance from the original broker. The fraudulent broker never pays the carrier, and the legitimate carrier who signed up to take the load ends up getting ripped off, while the scammer takes off with the fuel advance.

So, how do you avoid being double-crossed by a double broker?

Perform due diligence on all brokers. Call to check the credit of brokers. Look for variations in broker name, location, contact information, and billing information. Often these fraudulent brokers alter the documents they receive from actual carriers to convince victims that they are a part of a legitimate company.
Verify a carrier’s information with their Department of Transportation registration. If the phone number and address don’t match the information you’re given, that’s a big red flag.
Double check the broker’s rate. Use common sense and apply the old adage, “if it sounds too good to be true, it probably is.” A scammer posing as a carrier may accept a load for much less than the going rate to entice a broker into taking the deal. Or, a scammer may offer a carrier more money than originally offered by a broker to take advantage of someone who needs a quick payday.
Be aware of timing. Deals posted late in the week or at the end of the day are frequently made by fraudulent brokers. Why? Because they’re preying on truckers’ worries over not being able to schedule a load by a certain time. And anytime a broker seems in a rush to get you to agree, you should also be wary.
Check their Authority to Operate. Search FMCSA’s Safer and Fitness Electronic Records system website, https://safer.fmcsa.dot.gov/ to make sure the DOT/MC authority to operate number matches with what the carrier has submitted.

Spending time to validate and research necessary information about a broker is important to ensure that you’re not being scammed. Avoid becoming a victim of swindlers who are just looking to make money off a quick con.

Understanding Freight Invoice Factoring Rates

‘Low rates!’ ‘Risk-free!’ ‘Fast cash!’ ‘No upfront fees!’ These are just a few of the phrases you see when you search for invoice factoring rates. You might find a number of deals from factoring companies advertising low rates and quick cash flow. This sounds good on the surface, but there are often many details that aren’t disclosed upfront.

invoice factoring rates - smiling truck driver

All too often, factoring rates and deals that sound great at first end up being too good to be true. Many recourse factoring contracts come with fine print attached, putting you and your business on the hook for future risks. For example, when you sign a contract for recourse factoring, you assume the credit risk of the broker or shipper you are hauling for. This means you’re essentially gambling on the reliability of the factoring company, with no guarantees they’ll collect on your invoice. But because you’re locked into a contract on their terms, those unpaid invoices will again become your responsibility after the terms of the agreement expire (usually 60 to 90 days).

Low Factoring Company Rates: Understanding the Nitty Gritty Details

A lot of factoring companies advertise super-low rates to get more customers, but they don’t always clarify the details. For example, did you know there are many ways for those ‘lower rates’ to change? Typically, the lower rate is introductory and only good for a certain number of days. After that, the rate will rise incrementally, sometimes even daily – yikes! Also, after an additional number of days, you must use your hard-earned cash and buy the delinquent invoice back from the factoring company. Talk about an unpleasant surprise!

And there’s more. With some of these ‘low rate’ deals, you’re also locked into a contract of one or two years. These contracts are very difficult and sometimes very expensive to get out of. Unfortunately, such long-term agreements are hard to detect up front, because the contracts are so extensive and filled with confusing terms. As a result, you may not realize the full extent of what you’re accountable for.

Knowing the Bottom Line

When it comes to maintaining cash flow, factoring invoices at a good rate is a useful financial tool. However, since your main concern is the long-term health of your business, you want to avoid taking on unnecessary risk. To avoid damaging your business over time, consider non-recourse factoring with clear and reasonable rates, where you don’t become responsible for invoices that go unpaid. While non-recourse rates may be a bit higher upfront, you’ll avoid a lot of headaches, hidden fees and long-standing contracts – and that saves you money and hassle over the long haul.

Electronic Logging Device (ELD) Guide for Drivers

ELD guide

As of December 18, 2017, trucking companies will be required to use E-logs. With an average cost of $495 per year, that’s an expense that will now need to be part of your budget. All commercial motor vehicle drivers will need to comply with the Federal Motor Carrier Safety Administration’s ELD Mandate.

What is the ELD Mandate?

This rule was established to improve commercial vehicle safety and reduce overall paperwork for both motor carriers and drivers. Annually, the FMCSA estimates 1,844 crashes could be avoided, with 26 lives saved after the new E-log devices are in place. E-logs are also designed to prevent driver harassment by employers, deterring carriers from attempting to force ill or fatigued drivers out on the road.

ELD Requirements

ELDs must be used by commercial drivers who are required to prepare hours-of-service (HOS) records of duty status (RODS).
ELDs must be certified and registered with FMCSA.
Drivers and carriers must keep specific supporting documents.
Drivers are not to be harassed over ELD data – this data may actually back up claims of drivers who believe they have been harassed.

Limited Exceptions

If you’re a driver who operates under the short-haul exceptions, you may continue using timecards. Because you aren’t required to keep RODS, you won’t need to use ELDs.
If you’re a driver who uses paper RODS for not more than 8 days out of every 30-day period, you won’t need an ELD.
If you’re a driver who conducts drive-away-tow-away operations, an ELD isn’t required.
If you drive vehicles manufactured before 2000, an ELD isn’t needed (it requires synchronization with the electronic control module, which isn’t possible in older trucks).

Your ELD is Required to:

Automatically record date, time, location information, engine hours, vehicle miles and identification information for you, the carrier, and your vehicle.

Record all information at least hourly when the vehicle is in motion.
Record all of the elements changes in duty status
Record changes to a special driving category, such as a yard move.

Drawbacks to the ELD Requirement

The major drawback to the ELD requirement is the anticipated loss of productivity for drivers. Being micromanaged by the FMCSA will most likely result in less miles being driven by each driver, which will drive up costs and slow down delivery times. Additionally, small trucking companies with fewer resources will get hit hard with the upfront cost of the ELD as well as the monthly subscription cost that comes along with it. Furthermore, as the regulations are currently written, drivers have very little flexibility in bending the hours of service rules without being penalized. Many trucking companies are claiming that this rule may actually cause more accidents, since drivers will be forced to stay off the road even if they are not tired. This may result in truckers driving at other times when they actually may be fatigued.

The new regulations can be confusing, but if you stay informed, you can stay on top of the requirements and avoid complications. For more information, visit the FMCSA’s FAQ at: https://www.fmcsa.dot.gov/hours-service/elds/faqs

How to Fix Cash Flow Problems for Truckers

We know how difficult it can be to keep your trucking business running while waiting for customers to pay you. Your business needs cash flow for fuel, truck maintenance, insurance, and more, but getting timely payments from customers is often a real thorn in your side. For a trucking company of any size, you may want to know how to fix cash flow problems to eliminate a huge weight on your shoulders.

When customers don’t pay you on time – or at all —it can put your business in jeopardy. This is why invoice factoring is a common practice in our industry. When you factor an invoice, you essentially sell it to the factoring company at a discounted rate in exchange for immediate payment. Hopefully, that’s where the story ends, but as you have probably experienced, that’s not always the case.

Sorting Out Factoring

When people talk about factoring, they could mean one of two types: recourse or non-recourse. Most factoring companies focus on recourse factoring, where truckers are liable for invoices when customers don’t pay. If factored invoices get paid on time, you can breathe a sigh of relief. However, when an invoice doesn’t get paid within a certain number of days, the factoring company will charge you back for full payment…sometimes even months later.

The other type of factoring is non-recourse. This means that the factoring company who purchased the invoice from you assumes the risk if it goes unpaid due to customer bankruptcy, fraud, or delinquency. So if the customer takes a long time to pay – or doesn’t pay at all – those invoices won’t come back to bite you. The factoring company assumes all the risk.

What About Rates and Collections?

Non-recourse factoring gets you off the hook for collections. Rather than spending resources trying to collect payment for factored invoices, you simply let the factoring company take care of it. And while the rates for non-recourse factoring might be a little higher upfront, the reduced risk, combined with no need for collections could make non-recourse factoring well worth the cost.

Cash Advance For Truckers

Managing your cash flow in the trucking business is no easy task. But understanding the difference between recourse and non-recourse factoring can help you make the right decision for your needs, so you can get back on the road and focus on what you do best…managing your trucking business.