Small Trucking Firms Can Navigate Retail’s Bumpy Road Ahead With Faster Payments

Consumer demand is uncertain.

Retailers are pulling back on orders from their manufacturers and suppliers. The ripple effect ripples all the way through the middle and the last mile.

And for truckers who haul goods where they need to go, the prospect of better cash flow visibility through instant payments may prove a key tool amid volatility.

To that end, and as detailed by Freightwaves, reporting commentary from freight transport provider Seko, orders from retailers are slowing across various modes of transport. The peak shipping season may not be as vibrant as many had hoped, and merchants are cautious about placing new import orders. That immediately impacts the logistics landscape’s ocean and air freight segments.

But, as Bloomberg noted, there is overcapacity in trucking, where rates have declined to $1.49 a mile — those rates had been north of $3 as recently as 2021, during eCommerce’s massive uptick.

Matching Supply and Demand

Technology can aid in better matching between supply and demand when it comes to freight.

In one example, Cargobot has been helping carriers and shippers connect and better manage load booking and management digitally.

And in an interview with PYMNTS, “A phone call is not a structured relationship, an email is not a structured relationship,” Cargobot CEO Fernando Correa said that “these new tech innovations [being brought to market within the industry] are meant to organize an entire relationship that was previously unorganized, and where efficiencies slipped through the gaps.”

The trucking firms are dominated by smaller fleet operators — 90% of fleets have fewer than a half dozen trucks. Managing expenses and payables becomes ever more critical in an uncertain operating environment. As found in the PYMNTS report “AP Automation: Transportation Companies Innovate To Drive Growth,” a collaboration with Routable, 55% of transportation companies see innovating AP platforms as an important goal.

As PYMNTS reported late last month, Comdata, with a nod to the desire on the part of fleets to embrace electronic payments, has released Comcheck Mobile, a mobile payment solution. The app-based Comchek Mobile brings P2P payment functionality and a PIN-secured debit card that links with the solution to grow driver access to liquid funds. For the trucking firms, being able to pay drivers faster and reimburse them for “on the job” expenses more quickly can keep those drivers in place with the firm.

In other avenues where faster payments are gaining traction, faster access to cash, and capital, can help the truckers keep on truckin’(sorry for the pun).

Last year, BasicBlock Inc., a FinTech that provides financing for the trucking industry, grabbed $78 million in debt and equity raise. The payment platform for carriers features a freight factoring app to enable drivers to get paid as quickly as possible rather than waiting on invoices to be paid to finance operations.