Trucking companies often depend on timely payments to ensure enough cash flow to pay their suppliers. But when those payments are coming in from international offices, truckers must account for a new layer of logistical challenges. International transactions present the risk of currency devaluation and create uncertainty about whether payments will arrive in time to pay trading partners.
Here are four ways truckers and freight forwarding companies can streamline the process of collecting and making international payments.
1. Automate payments
The automation of international payments can be a game changer when it comes to paying suppliers. Automated payments can help your company better time its payments to make the most of its cash flow while making the process more seamless.
By making multiple payments at one time, automating your accounts payable also allows you to decrease the amount of time it takes to pay suppliers with the added benefits of enhanced security and improved accuracy. And when paired with an American Express® business card, for example, your business could earn rewards points on eligible expenses.
2. Consolidate transactions
When doing businesses in multiple currencies with different exchange rates, it can be difficult to manage your accounting data, and that can result in errors. Putting your payments on a business credit card can help you simplify these processes and consolidate your expenses. Combining payments can offer you more flexibility, reduce your purchasing costs, improve cash flow management and create purchasing efficiencies.
3. Explore cloud-based systems
Cloud-based technology platforms are making it easier for freight forwarders to create their own centralized systems. Through a process known as “netting”, companies can consolidate payments and receipts across the freight forwarder's network of trading partners into a single monthly transaction.1 Netting helps reduce the workload of managing accounts payable and receivable by up to 70% by minimizing steps such as manual data entry, and it offers greater transparency on transactions.
4. Understand data protection requirements
There have been increased efforts to protect data transmitted in the payments ecosystem. When you're doing business internationally, it's worth noting that data protection policies vary from country to country, and across different regions.
The European Union, for example, enacted the General Data Protection Regulation (GDPR) law in 2016 to change the way data is protected for EU citizens. The law applies not only to European citizens, but also to anyone who trades with EU businesses. Depending on the company's size, a data breach can result in fines of 2% to 4% of a business' global annual revenue, or up to 10 million to 20 million euros, whichever is higher.2 This is an important consideration for trucking companies, whose drivers regularly gather personal data from mobile devices, on-board cameras and telematics systems.
It's essential to keep your staff in the know about international regulations that might affect your operations. Doing business in international markets can reap huge returns for your company. Making sure your transactions go as smooth as possible will ensure your business gets the most out of your international operations.
This article is intended for general informational purposes only and does not constitute legal advice or an opinion on any issue. It should not be regarded as comprehensive or a substitute for professional advice.