Why your balance sheet looks fine but your cash flow isn't

If you've ever experienced late payments from a shipper or broker, you know the anxiety that can cause. Meanwhile, you're still shelling out for fuel, maintenance and driver wages, putting stress on your company's cash flow while you wait for payments you're rightfully owed. 

Here, Jennifer Lockett, freight factoring operations manager at altLINE by The Southern Bank shares tips to keep cash flowing and wheels turning—plus, how you can spot financial fraud before it happens to your business.

—Interview by Shefali Kapadia, edited by Bianca Prieto

What are the biggest financial fraud risks that trucking carriers, particularly small businesses, should be aware of?  

One of the most significant fraud risks facing trucking carriers, especially small businesses, is identity theft within the load‑tendering process. Bad actors frequently impersonate brokers, carriers or even government agencies like the FMCSA. We’ve seen carriers receive emails that appear legitimate, only to discover the sender was a scammer attempting to collect sensitive information. 

In a recent case, a medium‑sized carrier hauled a load believing it was for a well‑known, high‑credit broker. During verification, we discovered that the broker’s identity had been stolen and that the load had never been authorized.

What's one thing they can do to help prevent fraud from occurring?

The most effective first step in preventing this type of fraud is thorough verification. Carriers should confirm email domains, compare rate‑confirmation logos to the broker’s website, and check the age and legitimacy of domains. Partnering with a factoring company can also add protection, as they often recognize fraudulent rate confirmations based on patterns and past payments.

Why is cash flow such a challenge for trucking companies, especially small businesses and owner-ops? 

Small or new trucking companies often absorb operating costs long before they receive payment. Even when payment terms are set at 30 days, many debtors delay remittance to 40–90 days. During that time, the carrier has already paid for fuel, maintenance, driver expenses and other critical operating costs. When payments are pushed far beyond terms, available cash can quickly shrink or disappear, making it difficult to pick up the next load and keep trucks moving.

These delays can also impact essential obligations like insurance. If a carrier falls behind and a policy is canceled, they are unable to operate at all, resulting in an immediate halt in revenue. For small businesses with limited reserves, consistent cash flow is necessary to be able to continue delivering loads.

Do you think fleet owners have any blind spots when it comes to their balance sheets? 

Yes, and most of the issues stem from underestimating how delayed payments impact day‑to‑day operations. Fleet owners often focus on revenue and load volume but overlook how long it actually takes to convert completed work into usable cash. When debtors stretch payments from 30 days to 40–90 days, the balance sheet may look healthy on paper, but the business may be struggling to cover fuel, maintenance, payroll and insurance in real time. 

The cost of incomplete or delayed invoicing is another often overlooked aspect. Missing documents, invoicing errors or failing to routinely follow up with debtors can significantly extend payment cycles and create cash flow gaps that aren’t apparent in financial statements. In isolation, these incidents might not seem like a big deal, but they tend to happen often and can quickly add up to having a legitimate impact on cash flow.

For small carriers to maintain stability and keep trucks moving, it is essential to understand not only the amount owed but also the realistic time for collection.

What's one piece of advice you'd offer fleet execs at small motor carriers to keep cash flowing?

One of the most effective ways small motor carriers can keep cash flowing is by staying disciplined with back‑office processes. It may seem simple, but maintaining a stable cash flow starts with timely and accurate invoicing. Carriers should submit the invoice package as soon as the load is delivered, ensuring all required documents are included. If the bill of lading lists three pages, all three must be sent—not just the signature page. Any receipts or accessorial documentation should also be included. Missing paperwork delays the debtor’s ability to process payment, and payment terms don’t begin until a complete package is received. 

Consistent follow‑up is equally important. For net 30-day terms, for instance, checking in around the 25-day mark helps confirm the debtor has everything needed and provides clarity on payment timing. Continued follow‑up may be necessary if issues arise or payment is past due. 

Partnering with a factoring company can streamline this process, as they assume collection responsibilities and can handle communication with debtors who take a long time to pay. Not only does this typically accelerate payment on the invoices, but it also allows carriers to focus more of their day-to-day efforts on revenue-driving tasks rather than tedious accounting work.

Inside Lane's Take:
One habit separates carriers who stay cash-positive from those who don't: submit the complete invoice package the day the load delivers. Not the next day. Not when you get around to it. The day it delivers. Payment terms don't start until the debtor has everything they need, so every hour you wait is an hour added to an already long collection cycle.

Thanks for reading today's edition! You can reach the newsletter team at editor@theinsidelane.co. We enjoy hearing from you.

Interested in advertising? Email us at newslettersales@mvfglobal.com

The Inside Lane is curated and written by Shefali Kapadia and edited by Bianca Prieto.