Category Archives: Trucking

Trucking Company

Simple Guide: How To Start a Trucking Company With One Truck

There are many different aspects that go into starting a trucking company. But with a little planning and some hard work, you can get your trucking business up and running in no time. Just remember to take things one step at a time, and you’ll be on your way to success.

Trucking is a great way to earn a living. It’s a challenging career that comes with a lot of responsibility, but it can also be very rewarding. If you’re thinking about starting your own trucking company, here are a few things you should keep in mind.

Why Start a Trucking Company?

Starting a trucking company can be an enticing venture for several compelling reasons. Firstly, the transportation industry plays a critical role in the global economy, making it a stable and ever-growing market. As businesses continually rely on the efficient movement of goods, the demand for trucking services remains constant. Secondly, entering the trucking business allows entrepreneurs to tap into a flexible and diverse range of opportunities. From local deliveries to long-haul operations, trucking offers the chance to cater to various niches and industries. Moreover, with advancements in technology, the logistics sector is experiencing transformational changes, opening doors to innovative solutions and streamlined operations. For aspiring business owners, a trucking company presents an excellent chance to be at the forefront of these advancements and optimize efficiency. Additionally, starting a trucking business allows individuals to gain a sense of independence and control over their operations, with the possibility of eventually expanding their fleet and building a substantial enterprise. Ultimately, the trucking industry’s continued significance, coupled with the potential for growth and adaptability, makes it an enticing choice for entrepreneurs seeking a dynamic and profitable venture.

Steps for Starting a Trucking Company

A lone truck in the desert.

Strategize a Business Plan

The first step to starting any business is to create a solid business plan. This will be your roadmap to success and will help you make informed decisions along the way. A concise business plan should include your company’s mission statement, a market analysis, and a detailed financial plan.

When starting a trucking company, there are other key elements to consider in your business plan:

-Start-up costs: This includes the cost of your truck, insurance, and any other associated expenses.
-Target market: Who will you be hauling for? Will you specialize in a certain type of freight?
-Main route: What lanes will you run? Will you be a regional or long-haul carrier?
-Marketing plan: How will you get the word out about your new trucking company?

Creating a business plan may seem like a lot of work, but it will be worth it in the long run. By taking the time to plan everything out, you’ll set your trucking company up for success from day one.

Determine The Type of Business

The next step to start a trucking company with one truck is to determine the type of business structure that best suits your needs. There are several business structures to choose from, including sole proprietorship, partnership, limited liability company (LLC), and corporation. Each has its own advantages and disadvantages, for consideration as you determine which is best for your trucking company. The type of business you operate will have important tax and liability implications, so consult with an accountant or attorney before making a decision.

Reach Out To Business Services

After you have your business plan in place and have chosen a business structure, it’s time to start reaching out to business services that can help you get your trucking company off the ground. This includes finding a good vehicle services provider, securing financing, and obtaining the necessary permits and licenses.

There are many business services geared specifically towards start-up trucking companies. These services can help you get the financing you need, and find the right truck for your business. They can also help you obtain the necessary permits and licenses, and get your truck up and running.

There are several permits and licenses required to operate a trucking company. These include a DOT number, required by the US Department of Transportation, and an MC number, issued by the Federal Motor Carrier Safety Administration. You will also need to obtain a business license from your state.

Another important step in starting your trucking company is to get insurance. This is essential to protect your business from any potential liability. You will need to obtain both general liability insurance and cargo insurance.

Purchase a Truck Or Take These Next Steps

Now it’s time to own your trucking company. The first step is to purchase a truck (or lease one, if you prefer). Be sure to do your research and find a truck that is comfortable for you to drive and meets all legal requirements for operating a commercial vehicle.
If you decide to start your trucking company with leased trucks, there are a few things to keep in mind. First, you will need to find a good truck leasing company that offers fair rates and terms. Second, you will need to ensure your trucks are properly insured. And third, you will need to stay up-to-date on all required maintenance and repairs.

Once you have your truck, you will need to outfit it with the necessary equipment. This includes things like CB radio and a toll transponder. You will also need to purchase insurance for your truck.

Establish A Fleet Management Process

If you’re starting your trucking company with just one truck, you might think you don’t need a fleet management process. However, it’s always a good idea to establish a system for tracking your vehicles, drivers, and loads. This will come in handy as your company grows and you add more trucks to your fleet.

There are many software programs available that can help you with fleet management. Find one that fits your needs and budget, and start tracking your trucking company’s progress from day one. As you grow, you can add more features to your fleet management system, such as GPS tracking and load-management tools.

It is common for new truck companies to have inadequate funds for all operational costs or invest in fleet management technologies. However, growth in finance has led to the development of many start-up trucking companies financing options. An example is invoice factoring, in which a trucking company sells its unpaid invoices to a factor at a discount. This provides the trucking company with the cash it needs to continue operating while waiting for its customers to pay their invoices.

Build The Business To Gain Customers And Partnerships

The final step in starting your trucking company is to start building relationships with customers and partners. This is achievable through networking, social media, and good old-fashioned cold calling.

Don’t be afraid to start small. Even if you’re only hauling loads for a local business, you’re still in the trucking business! As you build your customer base and start to establish yourself, you can start to expand your services and grow your trucking company.

While building the business, one of the major tasks will involve developing the rate confirmation process, in which the company and customer agree to a price for the service. This can happen either through email or phone calls. However, it is important to have a process in place to avoid confusion or miscommunication.

Get Invoice Factoring Services Today

Factoring is a great solution for truckers who need quick cash to cover expenses. At Advanced Commercial Capital, we are experts in transportation factoring, and we can get truckers the money they need fast. We don’t charge setup fees, we don’t require long-term contracts, and we have tools that will save truckers time and money. To get invoice factoring services today, visit our website or contact us on. We would be happy to answer any questions you have about factoring and how it can help your business grow.

Two people signing contract

What is a Rate Confirmation

Introduction

If you’re in the freight business, then you’ve definitely heard of rate confirmations. But what are they, exactly? A rate confirmation is a document that spells out the agreed-upon shipping rates between two parties. It’s essentially a contract that ensures both sides are on the same page when it comes to pricing. And if you’re looking for a way to protect yourself from unexpected price hikes, then a rate confirmation is definitely something worth considering. In this post, we’ll break down everything you need to know about rate confirmations, including what they are, how they work, and why you might need one.

What is a Rate Confirmation?

Rate confirmation is defined as a formal document that is issued by a carrier to a shipper or their agent, which outlines the charges for shipping goods. The rate confirmation will detail the specific commodities being shipped, the origin and destination of the shipment, the date range of the shipment, and the applicable rates.

A rate confirmation is important because it provides clarity on the charges that will be incurred for a shipment. This document can help to avoid misunderstandings and disputes between the parties involved in the shipment. In some cases, a rate confirmation may also be used as evidence in a legal dispute.

What is a Freight Contract?

A freight contract is an agreement between a shipper and a carrier that outlines the terms and conditions of transportation services. The contract will spell out the responsibilities of each party, the type of service to be provided, the shipping rate, and any other relevant details. A freight contract can be used for both international and domestic shipments.

Why Use a Freight Contract?

A freight contract provides clarity and peace of mind for both the shipper and the carrier. By having all of the details laid out in a written agreement, both parties know what to expect and can avoid any misunderstandings. A freight contract can also help to protect both parties in the event of a dispute.

Why is Rate Confirmation Important?

A rate confirmation is a key component in any freight contract. It is a document that includes all the agreed-upon rates for shipping services, and is signed by both the shipper and carrier. The purpose of the rate confirmation is to provide a clear understanding of the terms of the contract, and act as a guard against future misunderstandings.

Without a rate confirmation, the carrier could change the rates at any time, which would put the shipper at a disadvantage. The rate confirmation protects the shipper by ensuring that the agreed-upon rates are set in stone.

A rate confirmation is also important because it can be used as evidence in the event of a dispute. If there is ever a disagreement about rates, the rate confirmation can be used to prove what was agreed upon.

Another importance of a rate confirmation is that it can help to build trust between the shipper and carrier. By having a signed document that outlines the rates, it shows that both parties are committed to the contract and are serious about doing business together.

What Does Rate Confirmation Entail?

In its most basic form, a rate confirmation is simply a document that confirms the price of shipping services contracted between a shipper and carrier. This type of confirmation is important to both the driver and the shipper for a number of reasons. The rate confirmation contains the following details:

-The name of the shipper
-The name of the carrier
-The origin and destination of the shipment
-The type of commodity being shipped
-The shipping date
-The total cost of the shipment.
-Importance of Rate Confirmation To a Driver

The driver is the one who will be performing the shipping services, and as such, it’s crucial for them to have a confirmation of the price they will be paid for those services. This confirmation allows the driver to know the amount of payment due, and gives them a point of reference if there are any discrepancies. The following are the importance of rate confirmation to the driver.

Ensures that the driver will be paid the agreed-upon amount: Perhaps the most important reason for a driver to have a rate confirmation is that it ensures they will be paid the amount they were originally quoted. If there are any discrepancies between the amount on the rate confirmation and the amount the driver is actually paid, they can refer back to the document to make sure they receive the full amount they are entitled to.

Gives the driver a point of reference: Another important reason for a driver to have a rate confirmation is that it gives them a point of reference. If there are any questions or discrepancies regarding the job, the driver can refer back to the rate confirmation to help resolve any issues.

Importance of Rate Confirmation To a Shipper

The shipper is the one who is contracting the shipping services, and as such, it is important for them to have a confirmation of the price they will be paying for those services. This confirmation allows the shipper to know exactly how much they will be paying for the job, and gives them a point of reference if there are any discrepancies. The following are the importance of rate confirmation to the shipper.

Ensures that the shipper will pay the agreed-upon amount: Perhaps the most important reason for a shipper to have a rate confirmation is that it ensures they will pay the amount they originally quoted. If there are any discrepancies between the amount on the rate confirmation and the amount the shipper is actually charged, they can refer back to the document to make sure they are not overcharged.

Conclusion

We hope this article has helped you learn more about rate confirmation and the important role it plays in freight contracts. At its core, rate confirmation is a way to protect both the driver and owner by ensuring that the correct price has been agreed upon for the delivery of goods. At Advanced Commercial Capital, we are experts in factoring and can provide your business with the cash flow it needs to succeed. Contact us today to learn more about our services and how we can help your business grow.

starting your own trucking company with many trucks lined up

How to Start a Trucking Business in 5 Steps

Introduction

If you’re an entrepreneur with your sights set on starting your own trucking company, even if you only have one truck, there are a few things you need to know. Owning and operating a trucking business can be both challenging and rewarding, but with the right planning and preparation, you can be successful. Here are some tips for getting started in the trucking industry.

1. Understand the Market

The first step to owning a trucking company is to understand the market. This means knowing who your customers are, what they need, and how you can best provide it. It’s important to have a firm grasp of the market, because it will dictate how successful your trucking company is. If you don’t understand the market, you won’t be able to provide the services your customers need, and your trucking company will ultimately fail.

There are a few key things that you need to understand about the market before starting your trucking company. First, you need to know who your customers are. What type of businesses will need your services? What are their shipping needs? Knowing your target market is essential to owning a successful trucking company.

Second, you need to understand what your customers need. What type of shipping do they require? What are their timelines? What are their budget restrictions? Once you know what your customers need, you can start to tailor your services to meet their needs.

Third, you need to understand how to best provide the services that your customers need. What are your unique selling points? What can you do better than your competition? Answering these questions will help you create a trucking company that is able to succeed in the market.

2. Develop a Business Plan

After you’ve done your market research, it’s time to develop a business plan. This document will outline your company’s goals, strategies, and how you plan to achieve them. It’s important to have a business plan, because it will give you a roadmap to follow as you start your trucking company. Without a business plan, it’s easy to get lost and make mistakes that can kill your business.

A business plan should include a few key elements. First, it should have an executive summary that outlines your company’s mission and goals. Second, it should have a market analysis that discusses your target market and how you plan to reach them. Third, it should have a sales and marketing plan that outlines your sales strategy and how you plan to market your company. Finally, it should have a financial plan that outlines your company’s finances and how you plan to make money.

Creating a business plan may seem like a lot of work, but it’s essential to owning a successful trucking company. It will help you stay on track as you start your business and make sure that you’re making the right decisions.

3. Establish Trucking Authority

There are many important facets to owning a trucking company, but one of the most critical is establishing your trucking authority. Trucking authority, also called operating authority, is the permit that allows you to transport commodities for hire.

To get trucking authority, you must first register your business with the federal government. You will then need to get liability insurance and file surety bonds. After that, you’ll need to comply with trucking regulations, which include getting your trucks inspected and maintaining logs of your trips.
It may seem like a lot of work to get trucking authority, but it’s worth it. Having trucking authority gives you the legal permission to operate your business and transport goods across state lines. Without it, you could be shut down by the government.

There are a few different types of trucking authority, so you’ll need to decide which one is right for your business. The most common type of trucking authority is the interstate operating authority, which allows you to transport goods across state lines. If you only plan on transporting goods within your state, you can get intrastate trucking authority.

4. Find Truck Loads to Haul

Another important step in owning a trucking company is to find loads to haul. There are many load boards available online, as well as brokerages that can help you find loads. It’s important to keep your trucking company busy, as this will help you make money and become successful.

The best way to find loads is to use a load board. Load boards are websites that list available loads, as well as the contact information for the shipper. You can search for loads by location, commodity, and other criteria.

Once you find a load that you’re interested in, you can contact the shipper and negotiate a rate. If you can find loads that you can haul at a profit, you’ll be on your way to owning a successful trucking company.

5. Cash Flow Management

Last but not least, it’s important to manage your cash flow when owning a trucking company. This means having enough money on hand to cover expenses, such as fuel, repairs, and maintenance. It’s also important to save money for slow periods. By managing your cash flow, you can keep your trucking company afloat and ensure long-term success.

One way of cash flow management is to use non-recourse factoring services from Advanced Commercial Capital. Advanced Commercial Capital has been providing factoring and other cash flow solutions to the trucking industry for many years, and we are experts in this field. We make factoring simple and easy to understand, and we have tools that help you remain successful.

When you factor your invoices with Advanced Commercial Capital, we will purchase the invoice from you and give you the cash upfront. This allows you to have the cash you need to cover expenses and keep your business running smoothly. We also offer other cash flow solutions, such as fuel advances and same-day funding.

Advanced Commercial Capital: Factors Who Care

Owning a trucking company can be a lucrative business. However, there are many expenses that truckers need to consider to keep their businesses running smoothly. That’s where Advanced Commercial Capital comes in. We provide factoring and other cash flow solutions so that truckers can focus on what they do best – driving trucks! We make factoring simple, because we don’t charge set up fees, we don’t require long-term contracts, and we have tools that will save truckers time and money. Fill out our contact form today to learn more about how we can help you keep your business running smoothly.

why do companies use factoring

How Does Debt Factoring Improve Cash Flow?

Cash flow is an ever-pressing matter for businesses. Payroll, taxes, operations, inventory, profits, and repairs depend on a healthy inflow and outflow of money from a company.

Unfortunately, maintaining a steady, positive cash flow is not always possible. Many industries, such as transportation, rely on the timeliness of their customers to fulfill invoices – and customers are not always prompt to pay. When invoices fall behind, and a company’s liquid assets begin diminishing, factoring is often considered.

Why do companies use factoring? Are there specific scenarios when factoring is a safe, healthy option for a faltering organization? In short, yes! In the content below, we define factoring and discuss three common circumstances that benefit from the unique financing solution.

How Does Factoring Work?

In the simplest terms, factoring is the process of purchasing unpaid invoices.

Traditional factoring includes a factor – such as our company – purchasing an unpaid invoice from a transportation company, putting cash in the hands of that company immediately. Once the customer pays the invoice, that money is given to us.

Many trucking companies wonder if they are liable to pay the invoice in the event that the customer never pays it. It depends! There are two main kinds of factoring, recourse and non-recourse, and both address this issue differently.

Recourse factoring places liability to repay the invoice in the hands of the trucking company. Non-recourse factoring assumes the responsibility of the invoice entirely. Thus, if the customer never pays back, the non-recourse factor takes the hit.

1. Factoring to Invest

Sometimes, the perfect investment opportunity appears out of thin air – right when your company does not have the financial freedom to jump on it. In other scenarios, investment opportunities are more deliberate. Perhaps you need to purchase a new fleet of vehicles or hire new employees.

Regardless of the venture, investments are designed to produce exponential growth in the future. However, they require a lump sum of money.

Small businesses and startups without a large customer base or steady cash flow often face this challenge: one must spend money to make money. When an opportunity presents itself, but your company is waiting on invoices to be paid, factoring is an immediate, safe solution.

2. Factoring to Repair

The importance of commercial truck maintenance cannot be overstated. Your fleet of trucks is crucial to a thriving company, and preventative maintenance plays a significant role in business growth and resource preservation.

Logistics companies often look to factoring to increase cash flow for truck maintenance. The truck driver can perform some maintenance before he or she begins transport. Other maintenance requires a professional. When something breaks down, a repair person should be alerted and hired to make necessary repairs.

Why would a transportation company require factoring to pay for repairs? Can truck repair wait for a brighter financial future? Most often, the answer is no. Truck maintenance should not be delayed.

We often list five arguments for the importance of truck maintenance:

– Fewer breakdowns. Proactive maintenance will help reduce the number of unexpected breakdowns – dramatically. When a truck breaks down, shipments fall behind and jobs are delayed. Ultimately, spending money for a repair will save on future disruptions.

– Fewer accidents. Fewer breakdowns mean fewer accidents. Working headlights, working brakes, etc. promote driver safety. When truckers are safe, other vehicle drivers are protected. The well-being of your employees is worth the investment of truck maintenance.

– Operational optimization. Maintained trucks work well! A fleet that is taken care of should operate at optimal functionality, lowering fuel expenses and lengthening the lifetime of your trucks.

– Happy customers. Smooth shipments, without unexpected breakdowns, often result in satisfied customers. Satisfied customers are often repeat customers.

– Legal requirements. Last, but certainly not least, the law requires commercial trucks to meet proper road safety standards. When a vehicle in your fleet needs to take a Commercial Vehicle Road Worthiness Test (CRVT), maintained trucks are likely to pass immediately.

3. Factoring for Payroll

Are you falling behind on payroll? Payroll factoring is an excellent resource for companies that care about the wellbeing of their employees but are experiencing an unexpected cash flow shortage. This can be all too familiar for businesses with many outstanding invoices.

Factoring as a Bank Loan Alternative: 3 Benefits

In the three scenarios explored above, a traditional bank loan could provide the funds needed to address investments, truck maintenance and repair, in payroll difficulties. However, some logistics companies do not qualify for traditional bank loans. Why? Qualifying for a bank loan often requires several qualifications, including excellent credit and experience. Some transportation companies simply do not have those two qualifications. Perhaps you have poor credit or have just started your business.

Additionally, factoring can serve as a traditional bank little alternative when a company needs cash flow fast. Traditional bank loans often take time to process. Factoring is fast. Some factoring companies can begin an agreement within a few days of application.

Finally, when you take a loan from the bank, you have to pay the bank back! Thus a traditional loan builds debt. For many transportation companies, debt should be avoided whenever possible. Factoring is a debt-free financing option.

Advanced Commercial Capital: Factors Who Care

In the modern-day, finding a financial organization that cares completely about its customers can be difficult. At Advanced Commercial Capital, we break this mold. We aim to serve our customers in every area.

How do we show this? Firstly, we offer non-recourse factoring services, meaning we assume the responsibility of our customers’ invoices – completely. Secondly, we do not require long-term contracts. Our goal is YOUR good, and we aim to demonstrate our value consistently.

If you are interested in discovering how factoring could impact the health of your transportation company, we would love to get in touch. Reach out to a team member at 855-465-4655 or complete our online contact form. We look forward to starting a conversation!

adcomcapital.com/blog/transport-factoring-101

What is Freight Factoring & How Does it Work?

Freight factoring is one of the most readily utilized methods of financing in the logistics industry. Though popular, every business is unique: what works for one trucking company may not be the best option for yours.

How do you know if freight factoring is the right financing method for you? This blog is a great place to start! In the content below, we define freight factoring, answer financing method FAQs, and examine a few of the most compared financing methods.

What is Freight Factoring?

Freight factoring serves as a strategic collaboration between a factor and a trucking company, addressing the challenge of unpaid accounts receivables. When a trucking company faces outstanding invoices, the factor steps in, acquiring these receivables at a discounted rate. This prompt transaction injects much-needed cash directly into the hands of the trucking company.

The process is straightforward: the trucking company’s client fulfills the invoice, the freight factoring company is reimbursed in full. This relationship ensures that the wheels keep turning smoothly, with the trucking business enjoying a continuous cash flow.

The appeal of freight factoring is its flexibility and ability to meet various financial needs of trucking companies. Whether it’s seizing business opportunities, covering daily repairs and vehicle maintenance, managing payroll, or even fuel expenses, freight factoring proves to be a versatile solution.

The two primary methods of freight factoring are: recourse and nonrecourse factoring. These avenues offer trucking companies flexibility in choosing the model that aligns with their specific requirements. Whether opting for the added flexibility of recourse or the risk mitigation provided by nonrecourse factoring, trucking businesses can tailor their approach to suit their financial objectives.

In essence, freight factoring emerges as a dynamic financial strategy, ensuring a steady and increased cash flow for trucking companies. It’s not just a transaction; it’s a partnership that propels the trucking industry forward, providing the financial stability needed for growth and operational resilience.

How Does Freight Factoring Work?

A key benefit to freight factoring getting paid quickly, providing a boost for trucking businesses. The way this works is, trucking companies submit invoices for same-day processing, ensuring a steady cash flow to keep operations running smoothly.

This collaboration benefits everyone involved. Trucking companies enjoy speedy payments, avoiding the usual delays of traditional invoicing. Factoring companies make money by charging a percentage during the invoice purchase, which they earn when collecting from the customer. Customers can trust dealing with financially secure partners in the industry.

Here’s a quick overview of the process:

Application and Agreement:
• Trucking companies start by submitting an application. Once approved, a detailed factoring agreement is set up, covering rates and fees.

Load Booking and Submission:
• With approval, the trucking company books a load and submits essential documents, including a bill of lading and rate sheet, to the factoring company.

Advance and Payment Terms:
• The factoring company advances the invoice amount, deducting a predetermined fee based on agreed-upon payment terms.

Payment by Broker or Shipper:
• The final step involves the freight broker or shipper making payment to the factoring company within 30 to 90 days.

As part of the process, credit checks on clients help reduce risks, aiding trucking companies in choosing reliable partners. The choice between recourse and non-recourse factoring agreements adds flexibility, allowing businesses to tailor their approach based on specific needs.

In essence, freight factoring offers a straightforward solution for trucking businesses seeking immediate payments and financial stability.

Recourse Factoring

As the name implies, recourse factoring involves recourse. Recourse factoring companies require collateral. If a customer does not fulfill the invoice, the trucking company is then held responsible for repaying the purchased account receivable.

To help minimize risk, most recourse factoring companies only accept trucking companies with creditworthy clients. Even so, sometimes customers fail to pay completely, positioning the trucking company with the same cash flow concerns as before.

Why would a trucking company choose recourse freight factoring? Though recourse factoring is riskier than nonrecourse, companies with enough capital to repay for an unfulfilled accounts receivable may choose this option, because recourse factoring rates are often lower. However, not all trucking companies have the capital to take the risk.

Nonrecourse Factoring

Nonrecourse factoring does not involve recourse, therefore dropping the collateral requirement. Although the factoring rate is sometimes higher than recourse, the factoring company assumes all the risk of purchasing the account receivable. If a customer fails to pay their invoice, the factor absorbs the bad debt.

Small to-mid sized trucking companies often utilize nonrecourse factoring because of the security involved.

Freight Factoring FAQ

As a nonrecourse factoring company, we readily receive questions about freight factoring. Hopefully, we will address any concerns or questions you may have.

Who is Responsible if My Customers Don’t Pay?

As mentioned, this depends on the method of freight factoring. Recourse factoring places responsibility for unpaying customers in the hands of the trucking company, while nonrecourse factoring places responsibility on the factor.

At Advanced Commercial Capital, we have a nonrecourse program where we assume all risk on purchased invoices.

What is the Difference Between Factoring and Securitization?

Although there are multiple differences between factoring and securitization, the primary involves the number of individuals purchasing the receivables. Factoring involves a sale to a single factor, while securitization often includes multiple investors.

Who Receives the Payments From My Customers?

Once the factoring company purchases an invoice, the customer will pay the factor directly. Payments accidentally given to the trucking company should be immediately forwarded to the factor.

How Long Do I Have to Factor?

Although we cannot speak for all factoring companies, we strive for flexibility at Advanced Commercial Capital. Thus, our customers are not obligated to factor for a specific length of time, and there are no maximum or minimum number of invoices or dollar volumes needed to qualify for our factoring program.

How Quickly After Submitting an Invoice Can I Get Paid?

Once the invoice and all supporting documents have been received, the trucking company receives payment within one business day. In certain circumstances, quicker payment can be provided.

Freight Factoring vs Traditional Bank Loan

For some companies, a traditional bank loan may be a better financing method. However, we often encourage trucking companies in need of immediate cash flow to pursue freight factoring.

Consider these three elements:

• Firstly, bank loans can be challenging to acquire. Factoring companies consider the creditworthiness of a trucking company’s clients, while banks consider the creditworthiness of the trucking company itself. Thus, if a trucking company has bad credit, it will have a difficult (if not impossible) time pursuing a loan.

• Secondly, bank loans take time to receive. When a trucking company needs cash fast, factoring provides cash flow within a matter of days – sometimes sooner. The process of applying for and receiving a bank loan is much longer.

• Finally, factoring is flexible. Choose a trustworthy transporting company with no minimum volume requirements or long-term contracts. Your business can benefit from the financing as needed… and only as needed. Factoring offers a sense of financial freedom and flexibility that traditional bank loans cannot.

Advanced Commercial Capital: Trustworthy Freight Factoring

Still, have questions about freight factoring? Our team at Advanced Commercial Capital is ready to respond!

We provide cash flow for trucking companies with zero unpleasant surprises. Additionally, our program involves numerous benefits – from a free fuel discount card program to free credit checks – designed to help you be successful at your job while saving time and money.

Interested in pursuing freight factoring for your company? Give us a call at 855-465-4655 or complete our online contact form! A specialist will respond shortly.

trucking scams

Look Out for These Common Trucking Scams

As the owner of a trucking company, you’re managing a large pool of drivers, customers, and loads. You already have a lot to handle, so the last thing you want to deal with are scam artists wanting to take advantage of your busy schedule. As with every other industry, no one is immune from becoming a target of a scam, no matter the size or value. Staying informed will keep you one step ahead of fraudulent practices and keep your company and employees safe. If you’re looking for more information here are five common trucking fraud scams to be aware of and how you can avoid becoming the victim of one.

Common Trucking Fraud Scams

Driver in Need: If you’re a company with an exceptionally large number of drivers, you may be a target of this type of scam. The fraudster will collect information from another driver by conversing with them or overhearing it from a truck stop and will use it to call dispatch to request a cash advance.

Phony Repair Shop or Fake Towing: Trucks commonly need to be repaired or even towed during service. The trucking company covers the expenses for repairs, and occasionally a scammer can exploit this by making false calls to a company asking for payment. The scammer provides vehicle information and a driver’s name and sometimes a fake invoice. The goal is to make the trucking company believe the load will be withheld from the driver until payment is received to get the company to pay up.

Fake Police Officer or Department of Transportation (DOT) Inspector: This act of trucking fraud involves a scammer posing as a fake government official. They will contact a trucking company to demand payment over a fake violation to get the truck back. You should also look out for notices in the mail asking for payment for renewal fees and threatening fines for missing the payment.

False Freight: This scheme happens when the driver is not allowed to supervise loading. Often the doors are sealed shut, preventing the driver from being able to ensure inventory counts, but is often still required to sign off on it anyway. Only when the delivery is complete do you realize the piece count is off and the scammers likely stole some of the freight.

Load or Fuel Advance Scams: A popular scam in the industry that targets brokers. Scammers steal the identity of a legitimate trucking company and book loads without any attention of picking them up. Instead, they request a cash advance for fuel and travel expenses. Once received, one of two things could happen. The scammer either disappears or more aggressively, holds the load hostage to demand further payment. Either way, the broker is left with money out of pocket and still in need of finding an actual driver to haul the load, if you’re lucky enough to still have it.

Double Brokering: Although this act entirely involves legitimate parties, you want to make sure you do not become a victim of this, and it’s another one that focuses on brokers. This time it occurs when a broker books a load for a carrier, but in turn that carrier brokers the load to a third party without the consent of the original broker or customer. In this case, the actual carrier of the freight is not under the original contract and therefore is uninsured. If the company that booked the third party does not pay the carrier who moved the load, then the original broker could possibly be on the hook for both payments.

How to Avoid Trucking Fraud

As it happens, you already took the first step of avoiding trucking fraud by reading about common scams. Knowing how to identify scams as they occur will stop you from making a mistake.

Here are a few pieces of advice to follow as well:

• Train drivers to not divulge important information in public and to always be aware of their surroundings.
• Request an invoice, and if actually provided one, review it carefully. If no valid address or phone number can be found,
• Find ways to validate the carrier or service provider. Always speak with the driver directly to confirm they are who they say they are. Try asking for information not readily visible on the truck such as the DOT number or employee ID number.
• Directly transfer funds to the driver, not a provider. Don’t risk sending payment to an unknown third party. Also, it’s best practice not to issue fuel advances to a new carrier you haven’t worked with before. Wait until they establish trust by successfully delivering a couple of loads before granting permission to receive cash advances.
• Always be suspicious if someone is pressuring you for immediate payment. Ask yourself if the situation urgently requires you to do so. If absolutely necessary, then just issue a smaller percentage of the cash advance instead of the full amount.

Advanced Commercial Capital: An Industry Resource

Advanced Commercial Capital is here to help the freight industry continue to grow with confidence. We’re in the business of helping your business grow through fair and honest invoice factoring. We protect our clients from unpaid freight invoices due to fraud, bankruptcy, or delinquency, without any surprises. To learn more or go get in touch with our team, call our office at 855.465.4655 or fill out our online contact form today.

invoice factoring companies for trucking

Invoice Factoring Companies for Trucking

In B2B industries, such as logistics, the financial stability of one company often depends on the initiative of another to pay their invoice. When customers are late to pay, cash flow suffers, and essential expenditures – such as maintaining salaries and important equipment – are hindered.

In these cases, trucking companies often look for financial assistance elsewhere, such as a bank loan or invoice factoring. When cash flow is hurting and you need a reliable push to stabilize your business, invoice factoring is often the best option.

In the content below, we define invoice factoring, explore how the financing option works, and dive into the pros and cons for trucking companies!

What is Invoice Factoring?

Invoice factoring is the process of turning unpaid customer invoices into immediate cash. Once the invoice is officially paid, the seller reimburses the factoring company.

How Does Invoice Factoring Work?

Invoice factoring is a simple process. Invoices are sold to a factoring company for a discounted rate or factoring fee, putting working capital into the hands of the company at the needed time. Once the invoice is paid, the factoring company is reimbursed.

For example:

• Trucking Company A has an unpaid invoice of $1,000.
• Trucking Company A sells the invoice to a factoring company for a 5% fee of $50.
• Trucking Company A receives $950.
• When Company A’s customer pays the invoice, the factoring company receives $1,000.

While exploring invoice factoring options, two variations of invoice factoring should be considered: recourse and non-recourse.

Recourse Factoring

Recourse factoring places the responsibility of collection on the invoice seller (i.e. your trucking company). This means collateral is required. In many cases, recourse factoring companies use your receivables as such. Recourse factoring mimics the process of invoice factoring, and in turn, your company receives immediate cash for unpaid invoices. However, if the customer neglects to pay the invoice, the factoring company may collect the money from you.

As the seller, you are solely responsible for the invoices purchased by the factor and will be responsible for refunding the factor whether your customer comes through or not.

If the customer never pays your invoice, you are left in a similar position as when you first sold the invoice – in need of cash. Because of the risk associated with recourse factoring, businesses often prefer non-recourse factoring.

Non-Recourse Factoring

Non-recourse factoring places the responsibility of collection on the factor. If the customer does not pay, the non-recourse factoring company suffers the loss.

Additionally, this form of factoring does not demand collateral.

Is Invoice Factoring Right for My Trucking Company?

Invoice factoring is often utilized by businesses who work for other businesses – a customer base that doesn’t always pay on time. However, payment procrastination can hurt an organization with employees to pay, equipment to maintain, and growth opportunities to pursue.

For trucking companies, a stagnate cash flow could cripple the business. Although cash flow is important, invoice factoring might not be right for every trucking company. Consider the following questions:

1. Is your cash flow hurting?
2. Are you looking for growth opportunities, such as purchasing trucks or hiring employees?
3. Are you looking for a fast way to stabilize your business?

If you answered “yes” to any of the above questions, invoice factoring could be an excellent choice for your trucking company!

Invoice Factoring Pros

– Invoice factoring is an excellent option for trucking companies working for other businesses, especially those that procrastinate payments.
– As already mentioned, invoice factoring provides trucking companies with fast cash, improving cash flow immediately.
– Invoice factoring is easy to be approved for.
– Non-recourse invoice factoring is collateral-free.

Invoice Factoring Cons

– If working with a recourse factoring company, you may be required to buy back unpaid invoices.
– If your company works directly for consumers, invoice factoring may not be a viable option.
– Certain factoring companies tack on hidden fees to the factoring services, such as late fees or processing fees. Be certain to select a trustworthy factoring company and understand all the terms and conditions before moving forward!
– Because invoice factoring approval is based on the credit history of your customers, you don’t have full control of approval – it depends on the financial strength of your clients.

Is Invoice Factoring Different from Invoice Financing?

Invoice financing resembles recourse factoring, detailed above.

One financial resource states: “Instead of selling your invoices to a factoring company, you use the invoices as collateral to get a cash advance and you remain responsible for collecting payment on the invoices.”

Why Don’t I Just Get a Bank Loan?

Invoice factoring delivers almost immediate approval. With the right freight factoring company, you could get paid within three days. On the other hand, applying for and receiving a traditional loan could take weeks, if your company is approved.

Approval for factoring funding and loan funding differs significantly. For example, banks consider your creditworthiness and the ability to afford payments, while most invoice factoring companies consider the creditworthiness of your customers.

Often, factoring companies take business values into consideration as well. Is your trucking company well-managed and known for integrity? You’re likely to be approved for invoice factoring within a matter of days, regardless of credit history.

Advanced Commercial Capital: Trustworthy Non-Recourse Factoring

At Advanced Commercial Capital, we pride ourselves in being an honest, trustworthy non-recourse factoring solution for trucking companies in need of financial stability.

Our team would love to get in touch with your organization. To learn more about what we do, give us a call at 435.673.4655 or complete our online contact form!

what is debt factoring

How Does Debt Factoring Improve Cash Flow?

Your trucking company is doing everything it can to succeed. Shipments are arriving on time and business is booming. The only problem is your clients are not paying their invoices in a timely manner.

An important part of any business, cash flow in the trucking industry can be sporadic and unpredictable, even at the best of times. Fortunately, debt factoring can help trucking companies maintain consistent cash flow via immediate payments. Below, we will consider the basics of how debt factoring can work for your company.

Will It Improve Your Cash Flow?

Even though it is often referred to as debt factoring, factoring does not involve taking on debt, but rather involves selling an asset you already own. Debt factoring is the process by which a third-party factoring company purchases either a portion or all your company’s invoices. Once an agreement is reached, the factoring company advances you an agreed-upon amount. As a result, you do not have to rely on customers paying their invoices immediately for your business to run smoothly.

Why Would a Business Use a Factoring Company?

There are several advantages to the debt factoring system. Chief among them are the following:

1. Debt factoring provides a quick infusion of cash, allowing for steady company growth – even when invoices are unpredictable. Many businesses struggle to maintain a steady cash flow. In turn, this often prevents them from growing and thriving. Due to the relatively immediate nature of debt factoring, once your invoices are purchased, you can expect a quick and reliable influx of cash to help your business continue to thrive.

2. Debt factoring saves time and administrative resources, including overhead costs. When you sell your outstanding invoices to a factoring company, that company takes over the management of your invoices. Because they are handling customer payments and debt collections, you do not have to pay an employee to handle this task, saving you time, administrative resources, and the overhead cost of an extra employee.

3. Non-recourse factoring helps work against accumulating debt. Non-recourse factoring is a type of debt factoring that protects you from accruing debt if your clients do not pay. For example, if a shipper were not to pay the invoice that you sent them after providing your services, you would not be on the hook for paying back the factoring company under a non-recourse factoring system.

What Are the Different Types of Debt Factoring?

We previously mentioned the benefits of non-recourse factoring. However, it is important to note that non-recourse factoring is not the only type of factoring available. Some companies may use a type of factoring known as recourse. The difference between this type of factoring and non-recourse lies in the risk placed upon you and your business.

Recourse factoring puts your company on the hook for customers who do not pay their invoices. By requiring additional collateral in addition to your invoices, the factoring company has the right to collect money for the unpaid invoice directly from you. Typically, companies that use this type of factoring hold some of your money in reserve.

In a non-recourse factoring agreement, the factoring company fully assumes the risk. Accordingly, if the freight broker or shipper does not pay their invoice, the factoring company suffers the loss. Generally, non-recourse factoring companies do not hold any of your money in reserve, as there is no need to do so.

Advanced Commercial Capital: Risk-Free Debt Factoring

With Advanced Commercial Capital, your trucking company assumes very few risks! Because of the unique nature of our non-recourse freight factoring service, there are no consequences to you if your clients fail to pay their invoices. We also do not require any long-term contracts and do not charge termination fees.

Additionally, we offer:
• Fast and flexible funding options, paying you in as little as one hour for your freight bills
• Strong relationships that foster your success
• And valuable benefits that save you both time and money, from our free fuel discount card program to free credit checks

All of these are just some of the reasons why our clients choose to stay with us for the long haul.
Advanced Commercial Capital can help your trucking company succeed in ways you never thought were possible.

Talk with our team to learn more about how non-recourse debt factoring works by giving us a call at 855.465.4655 or reaching out via our online contact form. We look forward to offering you the easiest and smartest way to factor your freight bills and get the cash you need, without any surprises.

broker credit

What Should I Know About a Freight Broker Line of Credit?

As intermediaries between carriers and shippers, freight brokers face distinctive business challenges, from managing cash flow to learning about the credibility of companies they work with. A freight broker line of credit can assist brokerages in managing financial stresses, overcoming challenges, and understanding the trustworthiness of potential clients.

Primary Challenges for Freight Brokers

Why is a line of credit necessary for freight brokers? Business credit for trucking is essential to address challenges common to most freight brokerages, including surety bonds, insurance, competition, liability, and cash flow.

1. Surety Bonds

By definition, “a surety bond is a promise to be liable for the debt, default, or failure of another. It is a three-party contract by which one party (the surety) guarantees the performance or obligations of a second party (the principal) to a third party (the obligee.)”

Every freight broker is required to obtain a surety bond from the government to operate legitimately in the United States. This agreement between the broker and the government is a guarantee that the freight broker will meet all contracts with shippers and carriers.

Freight brokers are required to obtain a $75,000 surety bond. If a freight broker does not live up to its contracts with a shipper or a carrier, the surety bond assures shippers and carriers that the broker has the cash or assets to cover at least the amount of the bond.

2. Insurance

Freight brokers can procure surety bonds from insurance companies. However, brokers are required to pay premiums. To lower premiums, freight brokers can demonstrate that their company is low-risk and reliable with good credit scores.

3. Competition

The freight broker industry is extremely competitive. Once again, low-risk engagements and reliability help freight brokers stand out amongst the competition.

4. Liability

Although not always the case, freight brokers are sometimes liable for shipment or equipment damages during travel. To limit liability, freight brokers should evaluate the dependability and credibility of potential carriers before accepting new engagements.

5. Cash Flow

Financial strain is one of the most significant challenges faced by freight brokers, specifically consistent cash flow. While starting a freight broker business is relatively inexpensive, financial challenges arise quickly. Because carriers are often paid before shippers are billed, cash flow can become clogged or entirely depleted. As the intermediary between shippers and carriers, transportation brokers are often forced to satisfy and balance both parties involved before acknowledging personal cash flow issues.

However, unacknowledged cash flow issues eventually cripple a company. Amid balancing such significant challenges, freight brokers may look for additional financial assistance to promote business growth and livelihood. Freight factoring is one such option.

Benefits of a Freight Broker Credit

1. Surety Bonds & Insurance

As mentioned, strong business credit scores can help freight brokers appear low-risk, credible, and reliable to insurance companies, often resulting in leverage to negotiate lower premiums.

2. Competition

Again, freight brokering is a competitive space, and strong business credit will make your company stand out among the rest. Additionally, business credit may allow your freight brokerage to negotiate for higher prices. Shippers and carriers appreciate low-risk, reliable brokers.

3. Liability

One business credit service explores the emphasis placed on credibility in the freight brokerage industry for both shippers and carriers.

• Shippers “will pull credit because they’re trusting the broker with their load. The brokers credit will offer detailed information about payment patterns and financial responsibility (or lack thereof).”
• On the other hand, carriers “will pull the brokers credit because they want to make sure there is a consistent history of payments on time. Carriers need to be able to depend on timely payments from the broker to fund their operations and turn a profit.”

Likewise, as a broker, you should also check business credit files of potential shippers and carriers. As mentioned, business credit files help you choose the best companies to engage with, reducing liability risk.

4. Cash Flow

A freight factoring line of credit for brokers directly addresses cash flow issues. In the freight factoring process, the factor purchases invoices directly from the broker, providing the brokerage with immediate cash needed to pay carriers. The factor then waits to receive payment for the invoice, instead of the freight brokerage. Factoring provides companies with cash needed to continue business on slow-paying invoices.

Factoring Line of Credit vs Bank Line of Credit

When considering financial assistance, freight brokers may consider acquiring a bank line of credit in comparison to a factoring-based line of credit. While a bank line of credit may be viable for several issues, consider a few potential downsides to pursuing this form of financial assistance as a freight broker:

1. A bank line of credit can add to the debt already carried by the broker. As with any business, avoiding debt when possible is best.

2. Additionally, a bank line of credit has its limits. Eventually, a maximum borrowing limit will be met, stopping cash flow. Once the broker can no longer rely on the bank line of credit, he/she is forced to rely on shippers once more, often an unreliable source of cash flow.

Advanced Commercial Capital

At Advanced Commercial Capital, we protect our clients from unpaid freight invoices due to fraud, bankruptcy, or delinquency – without any surprises. To learn more about the ins-and-outs of a freight factoring line of credit, reach out to our team at 855.465.4655 or via our online contact form!

fuel cards for truckers

EFS: The Best Fuel Card for Truckers

Fuel is among the most significant expenses for trucking companies. As fuel prices regularly fluctuate, fleet managers often feel burdened by the rapidly increased costs, hesitant to settle into any fuel price lows. Therefore, properly budgeting for long-term profitability can prove difficult. Additionally, the strain of unpaid freight invoices due to fraud or delinquency often intensifies financial stresses.

Trucking companies can turn to various financial assistance methods, including a fuel discount card program. Below, we explore everything you need to know about an EFS fuel card – from the definition of a discount card to an application guide.

What is an EFS Fuel Card?

An EFS fuel card offers a convenient, powerful, and secure payment solution for transportation companies, regardless of fleet size. Across North America, fuel cards are commonly accepted at thousands of locations. The EFS card is designed to meet customized financial demands and consolidate transactions onto a single card.

Fuel cards offer discounts on diesel by the gallon. How does this work? Essentially, fuel card providers form partnerships with fuel stations, allowing card holders to receive exclusive discounts from these specific fuel stations.

Specific discounts vary by location. However, the cumulative savings brought by fuel programs can be extraordinarily beneficial for trucking companies.

What Are the Benefits of an EFS Discount Fuel Card?

EFS helpfully lists a few of the primary fuel discount card benefits, and we have expanded on each:

  • Increased Purchase, Authorization, and Financial Controls: Many EFS fuel cards allow for customized security restrictions. For example, you may choose to require driver ID authorizations before a purchase. Additionally, EFS fuel cards can easily be deactivated to prevent unauthorized spending.
  • Consolidated Transactions: The conglomeration of transactions onto a single fuel discount card allows for better management of purchases, fuel, cash advances, etc., and impactful fuel savings at most national, regional, and independent truck stops.
  • Significant Fuel Savings: Although precise price fuel savings differ depending on the fuel card program, many offer significant benefits from bulk fuel purchases and reduced pricing during filling.
  • ATM/cash Access: Many fuel cards allow for easy access to cash/ ATMs.
  • Real-Time Online Account Reconciliation: Access to real-time data allows fleet managers to add or delete drivers or vehicles, as the business develops.
  • Online and Mobile Account Management: Online account management allow for bill payments and customized purchase controls. Additionally, online management is convenient! You can track purchases in a single location, providing for easy accounting and less physical paperwork.

    • Fuel Card Industry Trends

    Many of the current benefits of EFS fuel discount cards step from industry trend-based development. A few of the most common industry trends include:

  • Omni-channel experiences: The entire card industry is trending towards creating a customized experience for the holder. Many fuel cards have developed customized experiences for the user as well. For example, certain programs help the cardholder identify the nearest service station, based on location.
  • EMV migration: Chip-based cards are extremely common now, even within the fuel card industry. Chip-based fuel discount cards offer increased security and control over “offline” credit card transactions.
  • Telematics data: Some fuel card programs have embedded telematics interface into product offerings, providing data designed to improve fleet management and operating efficiency.
  • CDCVM security: The Customer Device Cardholder Verification Method (CDCVM) is a security feature designed to identify the individual utilizing the fuel card.

    • How Can You Apply for an EFS Fuel Card?

    Applying for an EFS fuel card is simple and streamlined as most applications only require basic information. At Advanced Commercial Capital, two applications are required:

    1. EFS Master Services Agreement

    The first, an EFS services agreement, only requires a simple list of info, including:

    -Legal name
    -Primary address
    -Phone number
    -Fax number
    -Primary contact
    -Primary contact phone number
    -Billing contact
    -Billing contact address
    -Billing contact phone number
    -Billing contact fax number
    -Number of active vehicles in your fleet
    -Number of active drivers/ cardholders

    Depending on the number of vehicles in your fleet, an account set-up fee is required. If applying for an EFS fuel card with Advanced Commercial Capital, we cover the set-up fee in full. After the basic information has been provided, authorization is required, and the application is complete.

    2. Customer Application

    The second simple form is the customer application. Once more, information required to complete the final step of the application is straightforward. For example, the following items are included (but are not limited to):

    -Corporate name
    -Location address
    -Website URL
    -Location phone number
    -Federal tax (or CRA) ID number
    -DUNS number
    -DOT number
    -Years in business
    -MC or provincial operating license
    -Ownership type
    -Number of cardholders and trucks
    -Amount of average weekly fuel, check, and other
    -Description of transportation services provided to clients

    Once the final application has been authorized, you are finished applying for the EFS fuel card program. Both components of the application with Advanced Commercial Capital can be found at an easily-accessible EFS application pdf. If you have any questions related to the EFS program, feel free to call us at 435.673.4655 – or get in touch with our EFS/FTS Plus representative, Amber White, at 901.474.0835!

    Advanced Commercial Capital’s Fuel Discount Card & EFS Checks

    At Advanced Commercial Capital, we are proud to partner with EFS and offer our clients access to a fuel discount card and an easy-to-use check product. Part of the FTS Plus discount network, the fuel discount card allows for fuel discounts at the majority of national, regional, and independent truck stops. Additionally, through the FTS Plus network, truck drivers can save money on tires, oil, truck parts, insurance, and a wide variety of additional products and services.

    With your EFS account, you will be able to issue checks, similar to Comchecks and T-Checks, to transfer money to your drivers when needed. EFS Checks are easy to use, available at truck stops over the country, and have one of the lowest fee structures in the industry.

    EFS Fuel Card Discounts

    While fuel card discounts fluctuate with fuel prices, a few examples of fuel savings include:

  • Pilot Flying J: retail price minus 10 cents
  • Loves: retail price minus 5.5 cents
  • TA: retail price minus 5.5 cents
  • Other Regional and Independent Locations: average discount up to 20 cents per gallon

    • Advanced Commercial Capital

    We understand the financial strains that accompany managing a trucking business. Unpaid invoices and fluctuating fuel costs can be detrimental. This is why our non-recourse freight factoring service includes a fuel discount card program.

    What is the benefit of utilizing a non-recourse freight factoring service in conjunction with your fuel discount card? Of course, every company has to determine if freight factoring is the right financial service – many trucking businesses in need of immediate cash, experiencing economic difficult, waiting on a traditional bank loan, or in need of increased business stability find that freight factoring is a profitable solution.

    Why non-recourse factoring?

    Non-recourse factoring is a factoring method where the factor (our company) bears the credit and collection risk on purchased invoices. Because we won’t charge you back when your customers don’t pay their bills, there is no reason to hold reserves. To learn more about our non-recourse factoring services, give us a call at 855.465.4655 or reach out via our online contact form!