Both the automotive and logistics businesses are similar in many ways. For one, they deal with great amounts of money. A quick look at the invoices and contracts they have to draft and sign can confirm this. But these businesses have different approaches when it comes to resolving funds shortage. Automotive businesses often turn to banks when to address such issues.
For those in the freight and trucking business, there may be greater problems looming than just keeping their eyes on the road. Bigger operational problems plague them. Funds replenishment is also more difficult, as customers often do not pay the service provider on time.
Money Matters in the Car Business
Money is at the heart of business. Any entrepreneur will tell you that you can’t get money without shedding your own. Even the great Henry Ford had to fill his pockets full of operating expense or his Model T would not have come to fruition.
While there are many takes on the topic, historians trace Mr. Ford’s financing to John D. Rockefeller. All the magic and wonder that Ford’s mass production of cars would have come to a grinding halt without operating expenses.
Funding an automotive business today works similarly, although new car companies are designed for accelerated growth. Take Tesla Motors, for instance. The car company sources their funds from various investors from the private and public sectors.
Keeping the Deliveries on Schedule
Funding a logistics business and addressing financial issues work in a different way. Low profit margins and high fuel cost – not to mention costly truck repairs – are being aggravated by the fact that these trucking and freight companies are not paid on time by clients.
Luckily, financing in the form of trucking factoring from companies, such as CommonWealthMN.com, solves the problem. These companies give forwarders or the trucking companies much-needed cash after a successful delivery.
With money usually available even within a 24-hour timeframe, trucking factoring makes sure the only job most important to a trucker is to keep their eyes on the road.
Addressing common issues in the automotive and logistics industry require different methods. Despite that, they require a precautionary measure: streamline cash flow.