Most shop cash crunches aren''t a revenue problem — they''re a timing problem. Parts leave your account today; the fleet account and the insurer pay in 30–60 days; payroll doesn''t wait for either. That float is a structural feature of the business, and shops that measure it stop financing it by accident at panic prices.
Size your float in one afternoon
Bucket a normal month''s revenue by payer: card-at-counter retail (cash tomorrow), fleet accounts (net-30/45), insurance/DRP work (30–60 days, sometimes longer with supplements). Weight each bucket by its real lag — not the stated terms, the actual pay dates from your last quarter. Most mixed shops find two to five weeks of revenue permanently in transit. That number is your true working-capital requirement. Write it down; every financing decision below keys off it.
Compress before you borrow (the free money)
Supplier terms are financing. Net-30 with your parts suppliers is a revolving, interest-free loan the size of your monthly parts spend. Pay early consistently for two quarters, then ask for limit increases and early-pay discounts (a 1–2% early-pay discount on parts is real margin). These accounts also build your business credit file, which cheapens everything else later.
Bill supplements same-day. On insurance work, the supplement you photograph and submit today pays weeks sooner than the one batched on Friday. Assign it; audit it.
Deposit discipline on big tickets. Engines, transmissions, fleet builds: 50% at authorization is a normal ask. Customers who balk at deposits on four-figure jobs are telling you something useful early.
Card acceptance math. The 2.5–3% processing fee on retail work is cheap compared to carrying a receivable — steer big-ticket retail toward cards, not away.
Finance the remainder correctly
A line of credit sized to the float is the structurally correct product: the gap revolves, so revolving credit matches it. Drawn when the parts bill lands, repaid when the insurer does. Arrange it in a strong quarter — see the full menu in our working capital comparison.
Invoice factoring for fleet/insurer-heavy shops. If receivables dominate your mix, factoring those specific invoices converts them to cash at a discount — often cheaper than revenue-based money and self-limiting by design.
Revenue-based advances: spike tool, not baseline tool. An advance can rationally bridge a one-time collision — the month the big fleet contract starts and doubles your parts buy before its first payment lands. Financing a permanent float with factor-rate money means paying a triple-digit effective rate for a hole that never closes. Price any offer with our factor rate calculator before signing, and read the fixed-debit warning in our factor rate guide.
The quarterly hygiene list
- Float number recalculated from actual pay dates.
- Supplier limits and early-pay discounts renegotiated.
- Supplement-billing lag audited (target: same day).
- Line of credit renewed while the trailing quarter looks strong.
- Any expensive balance on a written refinance date.
If the squeeze is on right now, start a funding request — about five minutes, free, no obligation, no credit impact to check — and describe your payer mix so the structure matches the cash cycle.
The Load Report
Seasonal rate shifts and route-band updates, flagged the month they happen — one email, no filler.
