Owning a trucking company comes with its fair share of benefits, but there will also be some challenges and pitfalls along the road — pun intended. While the demand will always be there, the competition seems to be growing heavier and heavier.
Even the smallest economic shift can have a direct impact on your company’s ability to find work, sustain work, and continue moving. Not to mention the major economic, political, and consumer shifts that seem to occur often — such as the COVID-19 pandemic and the global riots.
Knowing how to dig your company out of a hole, and more importantly avoid landing in one to begin with, are crucial. But it is important to note that there are several things you can do as an owner to prepare your fleet for anything. Don’t worry, we’ll give you several tips to help you stay afloat in the toughest of times.
Analyze Overhead Frequently
Much like any other company out there, a trucking company has a lot of moving parts involved. Some businesses rent trucks, while others own them. Some have an office, while others do their paperwork at home.
If you can learn to keep an eye on all the moving parts and analyze how much you need them frequently, then you’ll know the areas of your business where you can cut costs and reduce expenses. This is essential, especially in difficult times, because it allows you to maximize your revenue potential and profit margins.
Trust us; it’ll make the tough decisions seem that much easier to make when suddenly you’re dealing with a global crisis like the COVID-19 pandemic.
Balance New & Returning Customers
Having a balance between new customers and returning customers gives your business a reliable source of revenue. It shows that your marketing and promotional efforts are working, but also shows your service is worth the money because clients are sticking around.
This steady balance is also important because it’ll give you some cushion when one of your long-term clients decides to leave (keep in mind, many trucking companies saw clients end their contract strictly due to the COVID-19 pandemic).
If you were to see one of them leave, you still have a never-ending cycle of new customers that can eventually work their way into a long-term contract.
Optimize Cash Flow With Freight Factoring
Our final piece of advice when avoiding disruptions in business caused by uncontrollable forces is to get involved with freight factoring. There’s a lot of ways your trucking company can benefit here and you’ll want to take advantage of all them.
First, they allow you to optimize your cash flow by giving you advances on certain invoices that typically don’t get paid for 30-90 days. This means you have cash in your pocket on day one (it might take two days in some cases) instead of having to wait several months.
Many freight factoring companies will also provide discounts on fuel and truck maintenance, allowing you to save even more each month. When difficult times come up, your business will already be prepared.
To learn more about freight factoring and how it can help you, contact us today!
References
“10 Ways to Survive a Slow Trucking Market.” 10 Ways to Survive a Slow Trucking Market | RTS Financial, www.rtsinc.com/articles/10-ways-survive-slow-trucking-market.
Apex Capital Corp. “How Your Trucking Company Can Survive Economic Shifts: Apex Capital Blog.” Apex Capital | Freight Factoring for Trucking Companies, 11 Mar. 2020, www.apexcapitalcorp.com/blog/trucking-company-survive-economic-shifts/.