Do you know why the ship sinks for the rest 55% of businesses within 4 years of foundation?
Multiple reasons lead to such downfall for businesses that ultimately leads them to shut down the business.
Only 45% of transport business startups survive in the market after 4 years of their foundation, according to the research conducted by few organisations.
Here in the blog, we will try to familiarize you with such major constraints from running a transport business successfully. 5 major problems of cash flow and business management to help you learn from the mistakes of others and never lead through such potholes again.
5 Common Challenges in Running a Transport Business:
- Spending too much
Most transport companies agree that their expenses go beyond expectations most of the time. It is because manual expense management is prone to errors.
Sometimes, your accounts department add already paid bills that come from truck servicing charges, insurance premiums, annual fitness renewal charges, and loan instalments to your current bill list, which makes you pay for a bill twice. They do it out of workload tension, and you don’t check the bill details due to being busy.
This way, you pay more than you should, which negatively affects your cash flow. So, manual management of expenses takes too much time, effort, and money and gives birth to a list of over expenses that make your business devoid of cash.
2. Late payments
Manual invoice process takes too much time. Sometimes, you prepare invoices after the due date.
And, when you send it late to your customers, they pay you late, which puts your business cash flow management out of order.
Not having money means not having any scope for your business growth, as you won’t be able to take risks and grab fleeting opportunities available in the market.
Moreover, you won’t be able to deal with your regular business expenses without money.
3. Driver management
Your drivers spend some money out of their own pocket on the way to their destination. But, it’s impossible for them, due to workload, to give you a full list of their expenses, as they tend to forget most of them.
And, when they come to you after fulfilling their duty and ask you for reimbursement, you ask them too many questions to get all clear, which irritates them and spoils your relationships with them.
But, an app or custom software that allows them to inform you about every single penny they spend, then the story will be completely different.
4. Sending an approx estimated transport service cost
It tends to happen that new customers, and sometimes the old ones, ask you for an estimate before giving you their work.
Your accounts team is always under the burden of making bills, which makes them unable to send that quote properly and immediately.
Even if they make it, they do so after taking too much time. It makes many potential customers move away. This way, you can lose a large number of potential customers.
5. Being Unable to Add Additional Expenses to Your Bills
It tends to happen that transport business owners forget to add the amount of toll tax and drivers’ night stay costs involved in a journey to their invoices, which leads to poor cash flow due to spending more and receiving less.
If you feed such expense details in your custom software, then it will automatically add such expenses involved in a particular journey to invoices. This way, you will receive every single penny you spend on a particular journey.
Let’s conclude all said above
This blog gave you a doubt-free understanding of 5 common challenges in running a transport business.
So, avoid doing such mistakes to make your transport business flourish. Furthermore, follow our blogs to find the solution to such problems that a transport company owner faces.
We also told you how a custom transportation invoice software system can help you add expenses involved in a particular journey to your bills, thus helping you receive all you spend.
