Close to 39 million business trucks are registered in the U.S., and over 4 million are Class 8 trucks, meaning they weigh more than 33,000 pounds. Class 8 trucks increased by more than 2% between 2020 and 2021. Combined, it’s estimated that registered trucks travel more than 302 billion miles each year. Tractor trailers (combination trucks) account for over 177 billion miles.
While that’s a lot of miles, the fuel consumed by these trucks is more concerning. Business trucks used 9 billion gallons of gasoline and 35.8 billion gallons of diesel. This is one of the leading reasons for the government to start pushing towards higher use of electric vehicles. California is talking about requiring larger trucking firms to convert their fleets by 2042 and pushing for new models to be zero-emission by 2035.
When you run a trucking firm, it’s concerning as EV trucks are new and don’t have a proven track record yet. Most EV rigs get no more than 1,000 miles on a charge, and it takes time to charge back up. Volvo’s VNR Electric gets 275 miles on a charge, and it takes 90 minutes to charge the batteries to 80%. For long journeys, trucking company management will need to plan routes accordingly and ensure enough charging stations.
Plus, they’re new and expensive. The cost of a Volvo VNR is estimated to be in the range of $150,000 to $300,000 (dealer cost). Even if the government offers an incentive of up to $40,000, it may be expensive for smaller trucking companies. And, companies will need to install chargers in their yards. You need licensed electricians, which can cost hundreds of dollars per charging station, even with rebates and tax incentives.
The good news is you have time to plan for this switch. Don’t panic or feel rushed to get onto wait lists for electric trucks yet. A few changes to your business routines sets you on a path to replace your current equipment with EV rigs.
Start Improving Your Business Credit Score
Chances are high that you’ll need to take out a loan to purchase new rigs. Get the lowest interest rates with a high business credit score. To improve your score, you want to pay off existing loans and get your debt as low as you can, have strong revenues, and pay your bills on time.
Poor credit can be costly. Small business loans may have interest rates of upwards of 30%. If you have a higher credit score, lenders report rates of as low as 2%. You save a lot of money when your credit is excellent.
There’s one more thing to consider with your business credit score. The amount of time you’ve been in business impacts your score. Banks like Wells Fargo require you to have been in business for a minimum of two years. Work with a financial company that doesn’t penalize new trucking companies if you’re just starting out.
Still, you’ll find that most banks require you to have been in business for at least six months. If your business is younger than that, you may find it difficult to qualify for a loan, so it’s best to wait a few months and focus on saving money through invoice factoring and avoidance of late fees.
Build Your Client Base
Building your client base helps you increase your revenues. You don’t want to take on anyone, however. Do your research and check a company’s integrity and track record for on-time payments. If you find a company that has several late or missing payments, you should move on to someone else.
Saint John Capital allows you to check business credit scores for free. You can research brokers and shippers before you agree to work with them. You’ll be able to grow your client base without blindly taking risks.
Use our load board to find new brokers and shippers in need of haulers. Search by location, price, and load size and find work that fits your needs and pays you what your time and expertise are worth.
As you take new jobs, use the app’s track loads technology to check where your drivers are at any moment. If you have a client wondering how much longer it will be before your driver arrives, you’ll have the real-time information needed to estimate your driver’s arrival time.
Stop Paying Late Fees to Your Creditors
How do you get paid instantly? Factor your invoices. Instead of sending out invoices and waiting for your clients to pay what they owe you, you pay a small fee to Saint John Capital. We pay you, often the same day if you have our Visa debit card, and your days of waiting weeks or months for payment come to an end. You have money instantly and can pay your bills on time.
When you pay your bills on time, you avoid expensive late fees. If a late payment with one creditor is $35 a month, just three months of late payments put you over $100. If you’re paying multiple creditors late each month, the fees quickly add up. Can you afford to lose that much money because your clients aren’t paying on time? Stop paying late fees and more money ends up in your savings, which you can save up for the purchase of new trucks when the time comes.
Get Paid Now
How does freight factoring work? Pick up or drop off a load and submit the bill of lading through the Saint John Capital app. We’ll approve the payment request and send the money you’re owed, minus our fee. You’ll have that advance added to your debit card balance or sent to your bank.
If you request payment when you pick up the load, you get a portion of it. The balance is paid once you’ve completed the delivery. If you submit your bill of lading after delivering it, you get the entire amount minus the factoring fee.
Immediate payments are a small part of the benefits you gain when factoring your invoices with Saint John Capital. The app generates invoices automatically for you, so you don’t waste time invoicing clients. Upload the invoice right to your accounting software for quick and easy bookkeeping.
Our business Visa offers fuel discounts. Until you have an EV rig, you can save money on each gallon of diesel or gas that you purchase during a fuel-up. Over time, that discounted fuel puts a lot of extra cash in your hands, and you can save that to help pay for a new truck.
Saint John Capital also offers a low-interest line of credit loan. Get approval in minutes when you apply online. You’ll be able to tap into that low-interest line of credit to purchase new rigs. Fill out the online application to get started.
Sources:
https://www.trucking.org/economics-and-industry-data
