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The trucking industry is one of the most demanding and fast-paced industries in the world, and as retail leaders like Walmart and Target try to compete with e-commerce giant Amazon, shipping continues to expand with no signs of a slowdown in sight. It is a great position to be in for the trucking industry, but keeping up with the demand comes with considerable challenges which lie primarily in financials and payment. Financial control in the trucking industry is two-fold. First of all, it is important to have cash-flow at hand on a daily basis. Secondly, control of that cash-flow is critical which is why certain forms of credit along with fleet cards have become essential in the success of fleets both large and small.
The origin of the fleet card in the United States can be traced back as far as the 1970s with a credit card-like process for fuel purchasing that was as cumbersome as it was inefficient. But the concept was formidable and as digital technology advanced, so too did the fleet/fuel card. In the 1980s the fleet card industry took off with the implementation of the magnetic strip allowing fuel stations to control fuel pump transactions. Today, the trucking industry can take advantage of an expansive fleet card industry with a reporting system that not only tracks fuel expenses, but also provides management efficiencies, convenience and security.
Depending on the individual fuel card and the supplier, security benefits of fuel cards can include:
And those are just a few of the benefits that a fleet card can offer. As the industry has grown, these tools have become even more robust, enabling efficiencies for both the fleet managers and the drivers alike. Fleet payment leader EFS has developed fleet and fuel cards that can be customized to the company needs. They have also partnered with MasterCard to offer a fleet card that can be used for items outside of fuel while managing the expenses at the same time. EFS utilized technology in ways that make fleet cards more valuable than ever. By leveraging the data collected from fleet card usage, companies can also track behavior to provide insights that inform even better efficiencies and a clear path to growth.
Regardless of the fleet size, EFS makes it a priority to provide fleet cards that are designed with specific fleet needs in mind. Here is how the comprehensive offering breaks down.
1. Fleet One EDGE, an over the road (OTR) card designed for fleets with 1-25 trucks. In a world of tight budgets and schedules, every dollar and minute counts toward the success of your fleet. The Fleet One EDGE card will give your fleet the ability to go that extra mile with discounts, credit possibilities and more.
The Fleet One EDGE advantage:
2. The EFS Fleet Card is a powerful, convenient payment solution that responds to the changing dynamics of Fleet Management by controlling fuel costs. Customized to unique needs, the EFS Fuel Card is designed to meet the financial demands of business, as well as those of employees or independent contractors.
The EFS Fuel Card provides more security and control. Set purchase limits in real-time and customize at the individual card level with distinct card prompts that validate before authorizing the fuel transaction at the point of purchase. The EFS Fuel Card consolidates transactions on a single card, providing a single data point to manage and control purchases, payroll, settlement, cash advances, and more.
The EFS Fleet and Fuel Card advantage:
3. TheEFS Mastercard® Fleet Card is the single card, dual network solution that leverages EFS’ superior controls for fuel purchasing, combined with Mastercard’s wide acceptance network for non-fuel purchases such as T&E expenses, emergency repairs, and more.
The Mastercard Fleet Card advantage:
As one might imagine, expenses in the trucking industry go far beyond fuel. The driver shortage has forced the industry to boost salaries which has resulted in increased attention to the cost of operation in other aspects of the business. These costs include everything from vehicle maintenance to updated communications systems and technology. There are even costs that tend to be overlooked but are some of the most important investments a carrier can make because they have to do with the law. Some of the expenses associated with legal operations include the following:
Suffice it to say, costs of operations in the trucking industry can be astronomical. Consequently, the need to create efficiencies and control over both accounts payable and receivable is crucial and why partnering with a company like EFS can be vital.
While many industries rely on either corporate credit cards or personal credit cards for expense management, most are realizing that mistake. The trucking industry is ahead of the game in this area, introducing both fleet and fuel cards that can be used to purchase fuel as well as other items with complete control and flexibility to both the company and the driver. In contrast, the bank credit card would open up the fleet to all kinds of unauthorized purchases and an inefficient process for the management of those expenses. Advantages of the fleet card not only provided complete control at the pump but prior to even getting to the pump. Fleet managers can place spending limits and spending categories that focus where expenses are made. This kind of transactional control is impossible with a typical banking credit card. Fleet cards are one of the most valuable tools a fleet can implement for its administrative efficiencies, complete control and transparency in driver behavior. They also provide data that can be used to inform and strengthen the systems even further.
Relying on credit can offer an abundance of relief in an industry where cash-flow is crucial and there are solutions that go even further than fleet card or fuel cards. Fleet factoring has become quite an ally for the trucking industry for a variety of reasons. Primarily, they enable trucking company to get paid faster for loads delivered which protects from lost revenue. An experienced and credible fleet factoring company like FleetOne Factoring has the trucking experience along with a strong financial foundation that can answer to specific trucking needs.
Because shippers often pay anywhere from 30 to 90 days, trucking companies are frequently behind in accounts receivable which means cash-flow can be tight and sometimes absent when it is needed for everyday operations. Factoring companies purchase invoices to enable quicker payment to the carrier. Fleet factoring provides cash-flow when it is needed and also manages the administrative responsibilities, so the carrier can focus on freight operations. Fleet factoring resources can be used for any type of operational expense and many of them even offer fleet card advances, insurance services and equipment financing. Factoring is not just another bank loan. FleetOne Factoring understands the business and can customize financing programs to fit the fleet. Fleet factoring is beneficial to a fleet of any size and because they are providing resources based on the company income, they can accommodate an unlimited amount of cash-flow based on the size of the invoices they are handling.
While the trucking industry is busier than ever, that does not always mean that cash flow is constant. In addition, business expenses in the industry are expansive requiring more control and transparency than most industries. The good news is that tools like fleet and fuel cards and solutions offered by companies like EFS and FleetOne Factoring provide carriers with the confidence that they will have resources when they need them. Most importantly, companies can rely on these partners to focus on the financials while they focus on what is most important: the growth of their fleets.
Resources:
northshoreadvisory.com/blog/how-business-credit-can-create-roadblocks-for-trucking-companies/
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