The end of summer tends to be peak harvesting times across the U.S. From orchards with apples ready for harvesting to soy and corn crops that are ready, it’s a busy time of year for the agricultural sector. Yet, the harvest season also brings challenges to those in the trucking industry.
The American Trucking Associations (ATA) estimates that trucking companies moved 11.27 billion tons of freight in 2024. Owner-operators and small trucking companies handle a lot of the freight being moved. These small companies are also the ones who need a continued cashflow to keep trucks on the road.
When you’re transporting produce, farm equipment, and feed, time is of essence. Agricultural freight factoring is a unique solution to the continued flow of money you need to keep going.
The Impact of Cash Flow Issues Common During the Harvest
With a looming government shutdown, some farmers were already waiting anxiously for aid. The shutdown will delay payments. If a trucking company is paid directly by farmers, payments for work done could also be delayed. It’s a concern.
It’s also more than that. The harvest season itself is regional and only happens for a month or so. Once harvests are over, planning for next year’s crops begins. It leaves trucking company owners with no agricultural work for several months. The peaks and flows of incoming money is a struggle.
Even if a company does the work and is expecting payments, it can take a month or more for money to arrive. This cash flow gap is problematic. While you’re waiting, you have fuel to purchase and pay for, business credit card bills, building rent or business loans, utilities, truck payments, maintenance, repairs, wages, insurance, permits, licenses, and so many other expenses. If you can’t pay them, you could end up paying fines, penalties, or late payment fees.
The longer you go without paying your bills, the more impact it has on your business credit score. Suddenly, your low score drives away potential clients and leads to higher interest rates for future truck or business loans.
Solutions Provided by Agricultural Freight Factoring
Agricultural freight factoring is a service and partnership where you get paid immediately for the work you do. It’s the ideal solution to slow payments and provides you with an immediate cash flow. It solves many of your problems.
- Access to Low-Interest Business Lines of Credit: Cover any funding gaps with a line of credit that has advantageous interest rates. Stop relying on high-interest credit cards.
- Discounted Fuel: Partner with a freight factoring company like Saint John Capital and receive a fuel discount card. You save money on each gallon of gas or diesel you purchase from a participating gas station or truck stop.
- Instant Capital: Have money on hand to pay immediate expenses like fuel, repairs, and wages. You have money to pay traffic fines, insurance costs, and maintenance fees.
- More Opportunity: Instead of finishing a delivery and struggling to pay for repairs and maintenance for the next agricultural delivery, you’re ready to go. Get right back on the road. Trucks are maintained and in great shape for another job. You’re not passing up high-paying loads due to a lack of immediate funding.
- Payroll Demands: With a strong cash flow, you have money available for wages and benefits packages. When you pay workers on time, you have a dedicated crew ready to work for you. It also makes you more competitive when it comes to hiring new drivers.
- Protection From Unpaid Debt: Have you ever had a client fail to pay you because of bankruptcy or sudden closure? With a specific agricultural freight factoring arrangement known as non-recourse, you’re protected.
How Factoring Works
Freight factoring is an easy-to-use service. Much of your work is done through the factoring app or online after you sign in. It starts when you do the work for a client. You’ve picked up and delivered the load. It’s time to create an invoice. That’s where freight factoring starts to come in.
- Sell that invoice to a freight factoring company for a discount, aka factoring fee.
- Get paid an advance instantly, often within one business day.
- Receive the balance when your client pays the freight factoring company.
There are details to consider. One of them is that you could have to repay the amount you received in advance if your client doesn’t pay. That’s if you have a recourse agreement. If you have a non-recourse agreement, you’re protected from sudden closure or bankruptcy.
The freight factoring fee depends on factors like the number of trucks you have, the amount of work you do each month, and your clients’ credit scores. You could end up with a factoring rate of 2%, which is far less than credit card or loan interest.
Advances may be 100%, but this also depends on your company’s credit history and track record. If you’re offered a 90% advance, you get 90% after submitting the payment request. The remaining 10% is paid when your client pays.
Put it into perspective. Suppose you’re hired to deliver soy beans to different areas. You’re owed $10,000. You agree to a factoring rate of 3%, and the advance is 95% now. Deduct the 3% factoring fee from the $10,000. You still make $9,700 for the work.
You get 95% of that $9,700 right now. That’s $9,215 you have available to cover expenses. Your freight factoring partner takes over waiting to get paid and sending reminders. When your client pays the invoice, the remaining $485 is paid.
The Importance of Timely Deliveries and Payments
By 2017, the number of crops needing harvesters exceeded the number of hours worked. Farm laborers are harder to find, and it’s going to get more challenging as wage requirements increase and worker availability declines even more. In 2001, 55% of farm workers were undocumented. That dropped to about 42% in 2025.
It’s taking the remaining workers extra time to harvest crops that weren’t destroyed by drought conditions. This is a problem for trucking companies. Expected agricultural work may not be peaking yet, or some areas aren’t seeing their crops move due to tariffs. For example, soybean farmers aren’t seeing the same levels of sales to China as they have. Farms in Oregon struggled to get enough people to pick cherries.
When money isn’t flowing as you expected, it’s time to embrace the benefits of freight factoring. Get paid immediately for the hard work you do. Avoid frustrating waits to get paid by your clients and juggle your expenses like fuel, utilities, wages, and benefits.
With Saint John Capital’s freight factoring options, you get paid as quickly as the same day. Have money in hand to cover expenses and avoid late fees and compounding interest. Reach us online to sign up and get started.
