As an owner-operator, it can be tricky juggling the countless tasks that need doing or tracking the current trends such as fuel prices—and make no mistake, fuel forms a significant part of your back-office costs. It’s easy to assume otherwise, and some ask, do truck drivers pay for gas? The short answer is yes, those operating small fleets, owner-operators, are footing the bill for fuel. But even worse, the delays in payment windows and figuring out a solution to the question, do owner-operators pay for fuel can be challenging at best. Through all these tasks, truck stop fuel prices and fuel prices in general may fall lower on the list of priorities than they should. Looking at the increase in cost for diesel fuel over the past year, the Energy Information Agency (EIA) shows the current year’s rates are much higher than in 2020. Last year, the fuel price of was $1.14 cheaper than its current average price. It was at $4.05 on February 24th, 2022. Working with a factoring company can manage those stressful tasks for you while providing beneficial ways to combat the changing fuel costs.
Eliminate the Hassle of Back-Office Invoicing
For starting trucking companies, back-office tasks and invoicing can add confusion and extra stress, especially on owner-operators. Getting behind on invoicing and having too many unpaid invoices can affect the business as a whole and hurt cash flow. Invoice factoring can help owner-operators combat issues with receivables and back-office tasks and maintain cash flow with a steady increase in fuel.
Digitize the Full Accounts Receivables Process
Manually handling account receivables can limit capital and negatively affect the company’s time, revenue, and overall efficiency. Digitizing receivables can free up more time to forecast, analyze cash flow, and track the continuous change to fuel costs. Improving the payment process can make the process more streamlined while providing a central platform for payment.
Use APIs to Reduce Miscommunication
An application programming interface (API) can promote communication quickly and efficiently. This software processes data across different applications to make information for businesses and customers easier to access. Such software integration can allow owner-operators to gain real-time visibility, which can help boost communication and operational efficiency while lowering costs. APIs also make it easier to know what’s happening when asked, do truck drivers pay for their gas?
Keep Records Accessible and Accurate
However, having records can make tracking fuel differences easier; if the data is up-to-date and accurate. As the business grows and gains more drivers, it can be challenging to set aside time to look over and update records and payment information. A key benefit factoring provides to lighten the stress of fuel costs is integrated fuel cards. Such cards can provide saving options throughout the nation at fueling stations, and carriers have the option of putting an amount on the card from invoice payments.
Leverage Analytics to Track Driver Costs Versus Income
Using analytics to track data for all the truck drivers’ costs can help you know where to make the proper cuts. Business owners must monitor cost per mile, routes and stops, and idling time to identify cost-saving opportunities. Idling alone can use about a gallon of fuel per hour, which can cause drivers to easily waste many gallons over multiple stops and waiting for loading or unloading. Observing such analytics can help owner-operators compare this to the company’s income and ensure a positive cash flow. This can also help managers ensure they have enough profit to pay for fuel by cutting the costs where needed.
Take Advantage of Digital Freight Payment and Factoring
With prices changing every day and technology becoming increasingly efficient in today’s economy, companies must understand the need for change. Using a digital factoring company can provide benefits throughout trucking operations. Digital freight factoring allows companies to have faster payment processing, account receivables, and digitization for documents and the entire payment process. This can ensure invoices do not go unpaid, and owner-operators maintain a promising cash flow to grow the trucking business despite increasing fuel costs.
Do Truck Drivers Pay for Fuel: Yes & They Can Afford It More Easily With BasicBlock
As fuel costs continue to change and show no signs of decreasing soon, owner-operators must find a solution to managing these costs. Factoring can provide benefits for companies to ensure they maintain a steady cash flow, have accurate records, and rely on analytics to identify cost-saving opportunities. As an owner-operator, managing a variety of tasks can be challenging, especially with added worries about fuel costs that you cannot control. However, working with an automated factoring company can provide a way to manage the changes and adapt to them. To see these benefits and more, get started with BasicBlock today.