When the year started, the average price of gas was $2.936 per gallon. Situations and times have changed. With the war in Iran, fuel costs have skyrocketed. By mid-April, gas prices averaged $4.123 per gallon. Diesel’s even higher at $5.608 per gallon.
If you hadn’t forecasted much higher fuel costs when creating your 2026 budget, you could experience a cash flow crunch. Your clients aren’t paying until 30, 60, or even 90 days after you transport their goods. You can’t hit the road and tell gas stations you’ll pay them later. You must pay now.
Our tips help you figure out the best ways to manage fuel price spikes without draining your savings or falling behind on other essential expenses.
Cut Unnecessary Spending
Tightening your budget is the first step. It’s time to look at what you spend money on each month and cut out anything nice-to-have but not essential. It doesn’t mean you’re giving up forever; you just need to trim your budget until the cost of living is more manageable.
Your drivers love listening to music streaming services when they’re on the road, but it’s time to cancel the subscription and switch to the free, ad-supported option.
You like reading the news during lunch in the office. You can read news online, so stop paying for a newspaper service for now.
Providing your staff with cable TV in the breakroom is something you’ve always done. It’s time to slash that expense. There are free services like Tubi that will suffice for now.
You rent office space for your workers, but they could easily do the work from home. Consider saving money on rent by adopting a remote-only platform. If you need to meet with clients, you can always rent meeting space for a few hours.
The new computers and printers planned for this year may need to be postponed for another year. Use right-to-repair laws to make repairs and upgrades, keeping them running smoothly for another year.
Avoid Deadhead Miles
Deadhead miles are miles driven with nothing in a trailer or the back of a van. You’re burning fuel without gaining any profit in return.
Your driver delivered a load to the other side of the state. On that return trip, the trailer is empty. You’re still paying for fuel, but that fuel isn’t generating profit.
Instead, use a load finding app, often available through a freight factoring company, and search for loads going to your area. Your driver is making money on both the outbound and inbound trips. You are using fuel both ways anyway, but you’re increasing your profits.
Quick Fixes to Improve Fuel Consumption
Your trucks and trailers are a big part of your business. They’re also one of the most costly investments you’ll make, and they consume a lot of fuel, with many semi-trucks averaging 6 to 8 miles per gallon. If you’re putting 100 gallons of gas in each of your truck’s tanks, that’s 200 gallons at a cost of over $800.
The more efficient your truck and driver are, the lower the fuel consumption. Some quick fixes will help with that.
- Avoid idling – Turn off the engine while eating a meal or taking a mandatory rest period.
- Don’t carry cargo on the roof – Trucks are more efficient when they’re aerodynamic. Storing items on the roof increases drag, which increases gas consumption.
- Drive slower – Going just 10 mph slower reduces fuel consumption by 15 to 30%.
- Tire inflation – Properly inflated tires improve gas mileage by around 0.6%.
Leverage the Power of Freight Factoring
Factoring is one of your biggest assets as a trucking company owner. Typically, your driver completes a job, returns the bill of lading to the office, and your office generates an invoice. That invoice goes to the client, where it sits unpaid for a month, two months, or even a full quarter.
While you’re waiting for payment, you’re drawing on savings or charging expenses to your business credit card. Interest is piling up, your balances are becoming frightfully low, and you’re stressed. Freight factoring changes that standard process.
Instead of waiting, send the bill of lading to the factor and request immediate payment. The freight factoring company processes your request, deducts the freight factoring fee (typically less than 5%), and sends payment to your fuel card or account.
You have money on hand to cover fuel, wages, benefits, and truck expenses. The factor takes over and waits for your client to pay. Once that happens, you’re set.
If your client doesn’t pay, you might have to repay the money you received in advance, but that depends on the arrangement you had. Non-recourse arrangements offer protection against repayment in certain situations. If a client goes bankrupt or shuts down unexpectedly, you’re protected.
With freight factoring, you:
- Access free credit reports to ensure a new client isn’t nearing insolvency or likely to pay late.
- Gain added benefits, such as fuel card discounts.
- Get paid as quickly as the same day.
- Receive invoices you can quickly upload to your bookkeeping software.
- Stop panicking over which bill to pay.
Pair Same-Day Payments With Fuel Card Discounts
It’s the fuel discounts that add to the financial benefit you gain with factoring. Payments go to your fuel card, giving you immediate funds for purchases at participating truck stops and gas stations.
Suppose you have a fuel discount of 10 cents per gallon. Currently, 200 gallons of gas would cost at least $824, depending on where you drive. If you save 10 cents on each gallon, you immediately save $20.
That $20 adds up quickly. You have five trucks in your fleet. Each truck is saving $20. After five fill-ups each, you’ve saved $100 per truck. At the end of a year, you’ve saved $5,200 per truck, for a total savings of $26,000.
The fuel discount is based on the size of your business. Small fleets often have a per-gallon discount. Large fleets may be offered a volume discount. It’s important to ask how the discount works when you sign up with a freight factoring partner.
Partner With Saint John Capital and Build Cash During Challenging Financial Times
Until gas prices settle, our tips help you keep your savings stable. In addition to same-day invoice factoring, we also provide fuel card discounts that help you save thousands every year. The more trucks you have in the fleet, the faster those savings build up.
Our freight factoring company offers some of the lowest factoring rates in the nation and numerous benefits, including TMS integrations, business lines of credit, and 100% cash advances. Even better, we provide a real-time quote in less than a minute and a 60-day trial.
