5 ways your trucking company can boost its profits in 2014

eCapital.com
5 WAYS YOUR TRUCKING
COMPANY CAN BOOST
ITS PROFITS IN 2014
T114

Got a question? Need some advice? Give us a ring. 800.705.1500 2
TABLE OF CONTENTS
Introduction 3
1. Increase your cash flow 4
2. Know your customer 10
3. Use a fuel card 12
4. Keep better records 15
5. Optimize your efficiency 18
About eCapital 21

INTRODUCTION
As a business owner, you enjoy many perks and benefits. But, you also face your share of challenges. Perhaps the most important one is being
profitable.
This guide includes five practical ways to strengthen your profits within the next year. Applying them can enable you to earn more with less
work, and give you better financial security.
Thank you for your interest in this report. Whether you’re a veteran or a new business owner, we know you’ll find something of value.
Continue reading to find 5 ways your trucking
company can boost its profits in 2014

1.
INCREASE YOUR
CASH FLOW

1. INCREASE YOUR CASH FLOW
Don’t worry. This isn’t as difficult as it sounds. In fact, there a few tools available that can enhance your cash flow almost overnight.
But, before we get to those, let’s look at why a better cash flow is critical to your business. With more cash at your disposal, you can:
Take on more loads. Having better cash flow allows you to accept loads from companies that take a while to pay their invoices. So, you’ll
have more load options– and less downtime. Many of these slower-paying companies pay more per mile, too.
Offer better terms. While most businesses set their payment terms, you may win over a company – and gain more loads – by offering longer-
term pay periods. Remember, companies face cash flow problems of their own. Those that do may give you more loads because you’re giving
them up to 60 days to pay your invoice.
Improve your credit rating. Having extra cash on hand enables you to pay all your bills on time, get early payment discounts, and strengthen
your credit score. That’s an important consideration for truck drivers. It also means avoiding costly late fees and related penalties, like higher
interest rate charges.
Reduce your stress. Let’s face it. The strain of living payroll-to-payroll adds up, both mentally and physically. As a trucking company owner,
you already have plenty of things to stress about like drivers, customers, vehicle maintenance, safety and compliance. Knowing you have
enough cash in your checking or savings account to pay for your ongoing expenses is a relief that can make your life easier.

So, how do you go about boosting your cash flow? While there are many ways, these three can do the job in a hurry.
Factoring
Factoring companies turn your invoices into cash, often within 24 hours. They essentially
“buy” your invoice, and assume the responsibility of collecting on your bill from your
customer. So, you get your money without having to wait 30-60 days – and that’s it. Most
reputable factoring companies only charge a few cents on the dollar for this service.
As a bonus, many factoring companies also provide other services or products (for free or
a small fee) that can save you time and money. Some of these include fuel discount cards,
customer credit-checking, fuel advances, and industry-related discounts.
Factoring is ideal for small to medium sized trucking companies. This allows you to accept
loads from customers with higher rates but slower payments, as a factoring company will give
you the money right away. Factoring is versatile – it can be used for loads obtained from a
broker as well.
You can typically take advantage of many of these additional services or products – including fuel discount cards – without a strong personal
credit history or being charged a fee. You may not even have to face a credit check or pay an application fee.
However, entering into an agreement with a factoring company is an important decision. Before doing so, here are a few things to consider.
Let’s start with the length of the contract. Most factoring companies require you to begin with a long-term agreement. This could be a
problem if you discover the service isn’t up-to-par. However, a few factoring companies offer a short initial contract period. This is a great way
to “kick the tires” and experience the service first-hand. Also, be careful about minimum requirements. Many companies advertise what looks
to be a good rate, but impose minimum volume or fee standards. So, the rate may not be as attractive as it seems.
1. INCREASE YOUR CASH FLOW - FACTOR
Factoring is ideal for carriers
whose brokers don’t offer quick
pays or advances, but provide
the best-paying loads.

1. INCREASE YOUR CASH FLOW - FACTOR
For example, let’s say a company’s factoring fee is 5%. But, you’ll have to meet a minimum volume of $20,000. You feel you can do that, so
you agree to the deal. However, your business slows unexpectedly, and you only have $10,000 in invoices to submit. That means you’ll end up
paying the same amount in the end, and your rate will essentially double. Fortunately,
some factoring companies don’t box you in with minimum requirements so you won’t get
trapped like this.
Some factoring companies force you to submit every customer invoice – they essentially want
all your business. But, here’s the problem. It often doesn’t make sense to factor every invoice.
What if some of your customers already pay quickly? Why would you want to be hit with
factoring fees on their invoices? Again, some companies offer more flexibility and allow you
to choose which invoices you factor with them.
Smart trucking companies will learn as much about a factoring company as possible before
they sign anything. Plus, there’s no better judge of a business than its clients. Companies
that treat their clients properly are quick to provide customer testimonials. Take some time to
speak to these customers – and get feedback straight from the source.
There are plenty of things to consider when choosing a factoring company. Of course, it’s not always easy to make an apples-to-apples
comparison. The challenge then, is to make as complete and careful assessment as you can. You shouldn’t base your decision on just the rate.
After all, this is cash flow we’re talking about – the lifeblood of your company. You should make your choice on a variety of factors, including
customer service, the company’s stability, the strength of the products or services, and the other things mentioned above. You‘ll be better off
in the long run for doing so.
Factoring can be an excellent way to immediately improve your cash flow on loads that pay well but slowly, and save you time and money.
Factoring can be an excellent
way to immediately improve
your cash flow on loads that
pay well but slowly, and save
you time and money.

1. INCREASE YOUR CASH FLOW - ADVANCES
As you know, fuel typically represents your largest source
of ongoing expenses. Paying these bills eats away at your
available cash.
Advances can ease this strain. They can be used to pay for
fuel or other expenses even before you complete the trip.
Many factoring companies offer this service for a small fee.
In most situations, advances give you 40% of what the load
pays in just a couple hours. You can choose to get funds
several ways: They can be transferred to your bank account,
added to your fuel card, or through and express code. So,
an advance will spend like cash at truck stops – without the
worry of carrying a large amount of money.
However, only about 25% of brokers and factoring companies offer advances. Also, brokers
usually offer loads that pay far less than the industry average. And their advances range from
$20-$50 per transaction. So, it’s better to only use an advance for the best paying loads, and
go to a factoring company if your broker doesn’t offer this service.
In most situations, advances
give you 40% of what the load
pays in about 24 hours. You
can also choose to get funds
transfer. Instead of receiving
your cash advance in your
bank account, some brokers or
factoring companies can apply
your funds to your fuel card or
issue a comcheck. So, an
advance will spend like cash at
fuel truck stops – without the
worry of carrying a large
amount of money.

1. INCREASE YOUR CASH FLOW - QUICKPAY
Like factoring, quick pay allows you to get paid right away on your invoice after you deliver the load. However, in this case, the money comes
directly from the broker that gave you the load.
Unfortunately, not all brokers offer this service. In fact, just like with advances, only about one-fourth of all brokers provide this service.
A quick pay can be an inexpensive solution – with an industry standard rate of 1.5%-3% per transaction – that leads to better cash flow.
Additionally, some quick pays can take up to 5 days to pay, yet still charge the same rate for next day payment.
Brokers that offer quick pays tend to have the cheaper paying loads. So, it makes more sense to seek the higher-paying loads, and if a quick
pay isn’t available then, factor the load for faster payment.
Overall, advances, along with factoring and quick pays, can be an intelligent, quick way to upgrade your cash flow.
ADVANCES + FACTORING + QUICKPAY = $

2.
KNOW YOUR CUSTOMER

2. KNOW YOUR CUSTOMER
How many times have you been in this situation?
You have a truck on the fence, a driver that’s stranded, or a driver deadheading back home. You hear about an available load. But, it’s with a
broker or shipper you don’t know anything about, including the company’s credit status, reliability, or payment schedule.
Should you gamble and take the load, and hope the company pays? Or should you pass on the job, and hope another one shows up soon
from a company you’re familiar with?
It’s a tough situation.
Being able to do a fast credit check on these companies can make your decision easier. Doing so gives you a glimpse into the company’s
payment history, so you’ll have a better idea if a company is a slow-payer – or even a non-payer.
Many factoring companies keep their own database of a broker/shipper’s payment history, and will share this information with their customers.
You can find out – either online or by phone–within minutes how fast a broker/shipper pays with a real-time snapshot. While some factoring
companies provide this service for free, others charge a per-usage fee.
Of course, you can always ask your colleagues about their experience with a broker or shipper you plan to haul for. But, you may not have the
time to do so in many situations. Also, you could just ask the broker/shipper about their payment schedule. But, the answer they provide may
not be accurate. Additionally, some third-party services may charge $15-$20 per month for this service, and their data won’t be as extensive.
These services rely on others to recount their experience with a broker or shipper.
Meanwhile, factoring companies have first-hand experience with a customer’s payment history. They provide the best glimpse into past and
current payment history, so you’ll have a firm understanding of how quickly or slowly a customer pays – and if there’s been a change in the
pattern. As an example, a customer that used to pay in 30 days may now take 60-90 days. Or, a company that once took 60 days to pay may
now only take 14 days.
Nothing beats having the facts. Having easy access to payment histories enables you to take on jobs you might have otherwise passed on due
to a lack of credible information. Best of all, it allows you to escape the financial strain of dealing with a slow-payer or non-payer. However, as
mentioned earlier, some of these slow-payers may have higher per-load rates. Using factoring, a quick pay, or an advance in these situations
can enable you to take advantage of these opportunities without having to wait to get your money.

3.
USE A FUEL CARD

3. USE A FUEL CARD
While there are many fuel discount cards available, not all are created equal. Some allow you to buy large amounts of fuel at the credit price
without having to carry a lot of cash. Other cards enable you buy fuel at the cash price instead of the credit price. Still others may offer cash
rebates or discounts at the pump.
Even better, some cards designed for fuel purchases give you the versatility of a debit card. These cards offer a discount off the cash price or
retail price, and save you hundreds or even thousands of dollars each month on fuel charges. Of course, this can significantly accelerate your
annual profits.
Credit Card for Fuel Purchases
Some credit cards offer cash rebates on fuel purchases, but require good credit. These rebates also may be subject to a monthly limit, and
you’ll be charged the highest credit price for fuel. Typically, these programs place limits on fuel rebates because trucking companies can rack
up rebates pretty quickly. Depending on the rebate program, you may wind up paying the retail price in the end. So, this option doesn’t give
you the best savings in the long run.
Fleet Discounts on Fuel
You can obtain the highest discounts on your fuel purchase in a number of ways. If you have 50 or more trucks, you might be able to negotiate
with the truck stops or card companies and get a discount on the cash or retail price. However, smaller trucking companies and owner-
operators will not be able to negotiate for these discounts.
Midsize Fleets and Owner-Operator Fuel Discounts
The good news is, midsize trucking companies – and even owner-operators – can still get discounted fuel. A card that combines powerful
discounts with a payment mechanism is the best way to go. This allows you to receive your discount at the pump, and only carry one card.
To get the steepest discounts, you need to be a part of a large group with strong buying power.
The bigger the group and the more fuel purchased, the better the discount.

3. USE A FUEL CARD
ATM/Debit Card Fuel Discount Cards
To get the payment mechanism built into your fuel discount card, you’ll need a
payment network like OTR, TCH, EFS, T-Chek, or Comdata. This will permit you to
buy fuel directly from the card. The powerful fleet network will pass the discounts
to you all in one package. However, companies that provide this typically run a
credit check and require you submit an application fee. They may also charge
monthly or annual fees, in addition to their per-transaction fees.
Why use a combined fuel discount ATM/debit card?
• Controls on spending. If you have drivers, you’ll be able to control how much
and what they spend money on. You can also decide whether to allow them to
buy scale tickets, DEF, tires, repairs, etc.
• It’s more secure than cash. If you lose the card, you can turn it off, transfer
funds to another card, and then have a new card sent to you.
• Increased flexibility. It’s a debit card, discount card, and ATM card in one
package.
• Better reporting. This gives you an easier way to keep track of when and
where your card was used, and how much fuel was purchased. It’s especially
helpful if you only use the card yourself, or if you have a few drivers.
Many factoring companies, fuel tax reporting, and state associations also use the
power of their “fleet” network to get discounts combined into one payment card.
In the end, the more trucks using their cards, the better discount you’ll receive.
Some factoring companies – such as eCapital – offer the same fuel discounts that
large fleets are able to negotiate. They combine it with features of an ATM/debit
card without any application fees or credit checks. So, you’ll get great discounts
even if you don’t have good credit or the buying power of a large fleet.

4.
KEEP BETTER RECORDS

4. KEEP BETTER RECORDS
If you’re serious about improving your profitability this year, don’t skip this step. Not knowing how
much you’re paying for individual expenses throughout the year makes it harder to identify – and
control – them. While you may be able to recognize some trouble spots easily, others will surprise
you. It’s these sneaky charges that can crater your profits.
However, here’s some good news.
It’s getting easier for truck drivers to monitor their costs. Inexpensive driver accounting software
is readily available online, such as mint.com or budgettracker.com. Designed with truck drivers in
mind, these programs are user-friendly and make it relatively simple to record daily expenses. If
you have a laptop, you could install the software, and input your expenses at the end of every day
while you’re on the road.

4. KEEP BETTER RECORDS
Of course, you can always use a spreadsheet – or just a legal pad – to record your expenses. The
important takeaway is to have some system in place – and use it consistently – to better understand
where your cash is going.
Other ways to improve your record keeping include:
Saving those receipts
Keeping receipts of all your costs not only aids your record keeping, but gives you the documentation
needed to claim certain expenses on your tax returns. Since many of your expenses occur when you’re
on the road, it’s smart to store your receipts in something that’s easy to transport – such as a manila
envelope or an expandable folder.
Incorporating your business
Doing so offers some record-keeping advantages, and provides protection on personal assets. For
instance, you may not have to collect all those annoying receipts to take the standard per-diem
allowance, which doesn’t require such extensive record-keeping. While you’ll have to pay to incorporate your company, the benefits you
receive may be more valuable to you. It’s wise to ask a lawyer or a tax expert for more information on this move before proceeding.
Using a professional service
Using a tax professional or a certified public account to develop expense reports or prepare your returns may seem expensive. But, if doing so
enables you to save hundreds or thousands of dollars on your taxes each year, isn’t it worth it? Additionally, if it frees you from hours and hours
of agonizing paperwork – and allows you to sell to more customers and recruit better drivers – it may pay off big in the long run.
Should you decide to let a tax professional handle your return, try to find one that’s experienced with preparing returns for trucking
companies. That’s because the rules and deductions that apply to you can be complex, vary by state, and may not be known by some tax
preparers.
What’s the bottom line in all of this? Keeping good records can help you increase your efficiency and maximize your profits.

5.
OPTIMIZE YOUR
EFFICIENCY

5. OPTIMIZE YOUR EFFICIENCY
A common sentiment in the trucking industry is that if you just drive enough miles, the costs will take care of themselves.
If only it were that easy.
It’s true that the more loads you haul, the more money you’ll make. But, an inefficient operating system
will hamper your profits no matter how much you drive. You can’t just outdrive it. Besides, why drive
1,500 miles for the same profits you can make at 1,200 miles with an efficient system?
Fortunately, you can improve your efficiency in many ways– and without too much effort. Some of
these include the following:
Don’t be a deadhead
The act of deadheading– driving home from a haul with an empty truck – is a profit-killer. You’re
essentially driving for free, spending money on gas, and creating wear on your truck. Load-matching
sites, like 123loadboard.com™, help you find loads for the return trip, and can get you the best paying
loads closest to your location.
Be a smart driver
While you may know every one of these tips, they all can boost your operating efficiency. So, they’re worth repeating.
• Take it easy when accelerating and decelerating. Hard starts and stops punish your vehicle, add to maintenance costs, and waste fuel.
• Slow down. Every mile per hour increase over 50 MPH cuts fuel mileage by roughly one-tenth a mile per gallon
• Be vigilant about monitoring tire pressure, and make the necessary adjustments for better mileage and braking power
• Add aerodynamic treatments for enhanced fuel performance
• Choose tires with low rolling resistance
Take advantage of discounts
Why pay full price when you don’t have to? Use fleet discounts (offered by many factoring companies) whenever possible to save on fuel, repairs, maintenance,
tires, and more. Remember, if you’re not sure if you qualify for a discount – or if one exists – there’s no charge for asking.
Fortunately, you can improve
your efficiency in many ways–
and without too much effort.

5. OPTIMIZE YOUR EFFICIENCY
Be smart about peak and slow cycles
Saturdays tend to be slow for picking up loads. It’s the same for the first week of each quarter. So, these represent good times to get tasks completed that
would otherwise clutter your schedule. On the other hand, Mondays and Fridays are typically busy – as is the last week of each quarter.
Embrace technology
Or at least don’t run away from it. Technology can improve your profits by enhancing your efficiency.
For example, a GPS system can ensure you stay on course – and not waste time and fuel on lost miles. Plus, it can provide a reasonable way to get around
a detour, accident, or traffic jam.
Additionally, you can download driver-friendly apps to your smart phone that supply breaking news about traffic alerts, road conditions, and upcoming weather
changes. Having a smart phone or laptop on the road can also help you find loads and get the best prices on lodging or meals.
Meanwhile, products such as digital fuel economy gauges provide instant feedback so you can adjust your driving on the fly to improve fuel mileage. Also,
anti-idling systems enable you to run sleeper berths without having to idle the truck. In the long run, technology can save you time and money– and accelerate
your profits.

ABOUT
eCAPITAL

ABOUT eCAPITAL
At eCapital (formerly Freight Capital), we’re on a mission to provide businesses with a smart way to improve cash flow. Why? We believe a
steady cash flow can change the course of a business. It can help a company define its future—and turn barely breaking even into kicking tail
and taking names.
eCapital is a forward-thinking force that enables businesses to make tomorrow better than today. We founded our company on the idea that
you simply should not have to wait 30 days or longer to get paid for the work you’ve already done. We pay you sooner. As soon as same day,
in fact. That way you can get back to doing great things. Whether that means buying better equipment, hiring more employees, or getting a
new gumball machine, eCapital shares your dreams.
It’s as simple as that. This is our passion. The reason we exist.
Have any questions about what you read?
Feel free to call us at 800.705.1500
or send an e-mail to info@ecapital.com.
We’d be happy to help.

5 ways your trucking company can boost its profits in 2014

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