Freight Factoring Services provide profitability for small truck fleet owners. Three rules to follow in keeping your small freight company profitable. Date 3-4-2005 Two years ago, perhaps you were driving a truck, dispatching trucks for another trucking company, or stuck in a dead end job. Today you have your own authority, insurance, and own your own small fleet. It’s not too difficult to find loads, keep your trailers loaded and your drivers on the road, but what’s more challenging is making money doing it. There are plenty of loads out there, but so many of those loads don’t pay enough to cover your costs, much less generate a profit. So many trucking companies, so few well-paying loads. Shippers and brokers know it. Most small fleet owners that are just starting lack the business background to calculate exactly what they need to charge per mile (or on a flat rate) in order to break even. There’s a lot more that goes into the equation than just the cost of diesel and driver’s pay. Too often, the small fleet owner forgets about or ignores overhead and fixed expenses involved in keeping a small fleet running. What’s more, the smaller the fleet, the higher the per-mile rate has to be to break even. Office staff salaries, rent, utilities, general insurance, your salary, depreciation on your equipment, and bad debt expense all have to be covered before your company begins to turn a profit. It is difficult for fleets with fewer than five power units to do so, because there are fewer units over which you can spread those costs. But there are several ways small trucking fleets can achieve profitability. PROFITABILITY RULES 1. Do not haul a load for a broker based solely on the fact that the broker will offer you a fuel advance or a quick pay. 2. Avoid taking loads from brokers that have no credit or poor credit. For every load that you haul and don’t get paid for, you have to haul 20 to 25 others to make up the loss. 3. Read your broker’s contract thoroughly. Many small fleet owners ignore some or all of these rules, which is why 15,000 small fleet operators go out of business each year. So let’s examine each rule more carefully. Fuel Advances and Quick Pays Brokers understand that carriers willing to pay them a fee for a fuel advance or a quick pay are desperate for a load. Generally, these brokers pay among the lowest per-mile rates. Indeed, you are likely LOSING MONEY on every load you haul from these brokers. When you consider the low per-mile rates AND the cost of your quick pay, your net revenue from taking these loads may at best cover your variable costs, but fall short of covering your total costs. Generally, if you are 100% reliant on brokers for obtaining freight, you are probably losing money. Establish relationships with shippers to haul their freight directly and rely on brokers for back hauls to reposition your equipment. Brokers with No or Poor Credit Thousands of new broker authorities are issued each year. Most small fleet owners don’t have the financial resources to subscribe to a credit reporting agency and others don’t have the experience to know or understand how to analyze credit. Failing to check credit and establish PRUDENT limits for your customers, whether brokers or shippers, is perhaps the single largest factor in the demise of small trucking fleets. Read your Broker’s Contract Thoroughly The devil is in the details. You have statutory rights as a common or contract carrier that some brokerage contracts ask you to waive or relinquish. For example, a large freight broker in the Midwestern United States requires its carriers to agree to allow the broker to offset the entire amount owed by the broker to the carrier (on multiple loads/invoices) against a single freight claim on one load/invoice. For example, let’s say you haul 30 loads for a broker for $1,000 each and the broker owes you $30,000. A consignee on one load claims its freight was damaged in transit and files a claim for the value of the cargo, say $25,000. Without even giving you the opportunity to file an insurance claim, the broker pays you as follows: $30,000 for the 30 loads @$1,000 per load, less $25,000 for the claim equals $5,000. Now, you are forced to accept payment of $5,000 instead of the $29,000 to which you would have entitled had you not waived your rights in the broker’s contract. What can a small fleet owner do to avoid these pit falls? The answer is simple. Retain the services of a small fleet factoring specialist and a good transportation attorney. Let’s review the PROFITABILITY RULES one more time. Rule number one: avoid taking loads from brokers that offer quick pay and fuel advances as a trade off for profitable per-mile or flat rates. Consider this: with factoring rates starting as low as 1.59% and advance rates as high as 90%, you can be MUCH more selective about the brokers you do business with. Seek out the highest rates with brokers who pay in thirty days and factor your freight bills. In summary, it cost you more money to take the low-paying broker with the quick pay than it would have to take a load from a better-paying broker on net 30 day terms with a factoring fees starting as low as 1.59%. While this is only an example, it highlights the fact that it is often less costly to factor a load, when your alternative is a low-paying load with a quick pay option. Use factoring to INCREASE profitability. Next, you want to make sure that the broker who is offering payment terms of net 30 days actually WILL pay you. A factoring company that is a trucking specialist should already have its own FIRST-HAND experience with your broker accounts. We allow you access to our web site where you simply give us the name and the broker’s six-digit authority number along with a credit limit you would like for us to approve. Within 10 minutes, you will have an answer based on real-time information on that broker’s payment history with us. You can establish and manage all your credit limits for all your broker and shipper accounts right on line. While we cannot guarantee you that you will never have any credit losses, we can assure you that when used properly, our credit system can reduce the risk of credit loss. Lastly, with over a thousand trucking fleets serviced per year of freight bill factoring, we can lend our expertise to you to assist you with complicated collection matters and strategies to help improve your cash flow and minimize your costs. Start Factoring Today! About 1st Commercial Credit, LLC First Commercial Credit is a factoring company that offers freight factoring for the transportation industry. Services may include but are not limited to trucking, air freight, local delivery and freight brokers in the USA, Canada and the United Kingdom. Trucking Factoring Rates as low as 1.59% We Make Same Day Decisions! Call now for details at 1 800 450 9653 or Request a Quote Online Other related pages about Trucking: Load Board at PickaTruckLoad.com Freight Factoring Company Free Load Board sponsored by 1st Commercial Credit.  Countries:   [Factoring UK]          [Factoring Canada]          [Factoring USA]  [Factoring Trucking]    [ Free Freight Matching Services ] NEW! Commercial Truck and Trailer Financing for Owner-Operators and Small Fleets Download Application

Factoring Rates as low as 1.59% Process To Get Started - Request a Quote. - Submit Application. - Sign Factoring Agreement. - Submit Freight Bills - Receive Immediate Cash > Request a Factoring Quote Factoring Program - No Minimums Required - No Minimum Invoice Fees - Free Credit Checks in 15 Min. - Same Day Funding Available. - No Financials Required - Best Rates in the Industry We Finance all Trucking and Transportation Industries > Containerized Freight > Freight Brokers > General Long Haul Freight > Intermodal Companies > Recent Transactions

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TRUCKING-LIVESTOCK	TRUCKING- COMMODITY
TRUCKING-DISPATCH SERVICE	TRUCKING-GRAIN
TRUCKING LOCAL WITH STORAGE	TRUCKING-HEAVY HAULING
TRUCKING CONSULTANTS	TRUCKING-LIQUID & DRY BULK
TRUCKING MANAGEMENT	TRUCKING-LOCAL CARTAGE
TRUCKING OIL FIELD	TRUCKING-MOTOR FREIGHT
TRUCKING-CONTAINERIZED FREIGHT	TRUCKING-OVER DIMENSIONAL LOAD
TRUCKING-CONTRACT HAULING	TRUCKING-REFRIGERATED
TRUCKING-DUMP	TRUCKING-SAND & GRAVEL
TRUCKING-OWNER-OPERATORS	TRUCKING-TRANSPORTATION BROKERS
TRANSPORTATION-PASSENGER-TOUR BUS	TRANSPORTATION-AIR FREIGHT
TRANSPORTATION-FREIGHT TRAIN LOAD	TRANSPORTATION-INTERMODAL DRAYAGE