If you’ve managed a freight, transport, or logistics company in Singapore for even a year, you’ve probably had the same experience everyone else quietly complains about: invoices move slower than cargo.
One client we spoke to recently handles more than 300 shipments per month, yet almost 68 percent of their invoices sit unpaid beyond 30 days. And that’s actually considered normal in this industry.
It’s the reason some firms weave tools like invoice financing for logistics businesses in Singapore into their working capital strategy. Not because they’re struggling, but because the industry’s cash-in, cash-out timing rarely matches up neatly.
After talking to dozens of logistics operators, you start seeing a pattern: they’re profitable, but their cash flow feels tight simply because money gets stuck in the system.
Let me explain why this happens — and why so many freight and transport companies quietly use flexible funding to keep things running smoothly.
The Real Cost Of Running A Logistics Business (And Why Cash Flow Gets Tight)
Singapore’s logistics sector makes up close to 7% of GDP and is ranked among the world’s most efficient. But behind all that efficiency, running a logistics business often feels like you’re sprinting on a treadmill that never slows down.
Here are some actual cost numbers logistics owners shared with us:
• A single 24-footer delivery truck can easily cost $900 to $1,300 SGD per week to operate once you factor diesel, ERP, parking, insurance, and servicing
• Forklift rental fees can hit $1,200 to $2,000 SGD a month
• Drivers’ salaries, depending on experience, range from $2,400 to $3,800 SGD, with overtime pushing it higher
• Port and terminal charges for some shipments exceed $200 SGD even before revenue comes in
Now here’s the painful part, nearly every logistics firm said that 70 to 90% of their customers pay on 30, 45, or even 60 day terms, and a few MNCs well-known in the freight sector insist on 90-day cycles, non-negotiable.
So while expenses hit daily or weekly, revenue strolls in slowly, smiling politely.
One operator in Tuas told us they had more than $540,000 SGD in outstanding receivables at any given moment, yet their working cash rarely exceeded 70k. They joked about being “asset-rich, receivable-rich, and bank-balance-poor.”
That’s the reality for many logistics businesses, profitable but squeezed.
Why Longer Payment Terms Are Becoming More Common (And Annoying)
The bigger the client, the slower the payment. That’s the unspoken rule.
In the last three years, payment terms across the logistics sector have stretched by an average of 14 to 21 days. It’s not because companies are bad paymasters, but because global supply chains are consolidating, and large customers run centralised accounting processes overseas.
We’ve seen examples like:
• Freight forwarders handling hundreds of monthly shipments but receiving payment only after quarterly invoice batching
• Haulage firms serving major FMCG clients stuck at 45-day cycles minimum
• Warehousing companies waiting up to 75 days for storage invoices covering just one container block
This mismatch turns cash flow into a constant challenge, especially when business is growing fast. You take on more jobs, but the cash that funds those jobs doesn’t arrive until much later.
And this is why more companies turn to facilities like cash flow financing for logistics and freight service providers, not as emergency funding, but as a buffer to keep operations smooth when timing becomes unpredictable.
The Quiet Cash Flow Gap Nobody Mentions
Here’s something a mid-sized freight operator shared, and it’s surprisingly common.
They had:
•Monthly revenue: $400k to $450k
• Monthly expenses: $300k
• Average receivable days: 52 days
• Average cash-on-hand: as low as $40k during peak season
They weren’t struggling. They were thriving. The issue wasn’t profitability, but lag.
Drivers’ salaries don’t wait 52 days. Diesel vendors don’t wait 52 days. Port operators don’t wait 52 days. But customers… absolutely wait 52 days.
That constant mismatch creates a cash flow knot. And once it gets too tight, business owners either slow operations, reduce fleet usage, or reluctantly turn down new jobs.
This is especially common when operators use funding solutions for freight companies dealing with 30–90 day invoices, which help convert confirmed receivables into working cash.
How Logistics Companies Use Flexible Invoice-Based Funding (In Real Life)
Forget the old image of business loans with mountains of paperwork. That era is fading. Most logistics companies don’t actually need large lump-sum loans anymore. What they need is quick access to money that’s already theirs.
This is why invoice financing solutions for logistics companies in Singapore feel more natural than traditional loans. They match the rhythm of logistics operations:
- You complete the job
- You issue the invoice
- You receive a portion of that invoice upfront
- You continue running your operations
- You get the balance once your customer pays
That’s it.
It’s not a loan based on your past performance, it’s funding based on work you’ve already completed.
A freight forwarder we spoke to advances about $80k to $120k per month this way. They said the biggest perk was not the funding itself, but the stability it gave them. They could plan manpower, fuel, and subcontractor jobs without worrying about client delays.
Why Some Logistics Operators Avoid Traditional Bank Loans
Bank loans are useful, but they don’t always suit the speed of logistics. One transport operator told us:
“By the time a bank processes anything, I’ve already fixed the problem myself.”
Banks often want collateral, long trading histories, or complicated paperwork. Meanwhile, logistics moves at a pace where shipments are booked, dispatched, delivered, and billed within hours.
This is why owners compare freight and transport company invoice financing options and pick solutions aligned with how their industry actually works. If they have more shipments that month, they have more receivables they can advance. If it’s a slower month, they scale back.
No big commitments. No long-term burden.
Common Worry: Does Using Invoice-Based Funding Look Weak?
Short answer? Not anymore.
In fact, some of the largest freight and logistics companies worldwide use invoice-backed funding. In Singapore, it’s extremely common among SMEs because 30–60 day payment terms are the norm.
Our internal survey of SMEs found that over 48% experienced cash flow pressures directly caused by slow-paying clients. In logistics, that figure is likely even higher due to multi-stage invoicing.
Owners used to worry that customers might see this as a sign of weakness. Now, they see it as a sign of financial maturity. It’s about controlling the timing of your cash, not begging for help.
And many firms that compare invoice factoring or invoice financing for logistics SMEs simply choose the model that fits their workflow and customer relationships.
Bigger Contracts Need Bigger Cash Buffers
Here’s something interesting. When logistics companies start growing, the biggest stress point isn’t finding new clients. It’s funding a new volume.
•More deliveries = more fuel
• More drivers = more payroll
• More containers = more port charges
• More shipments = more subcontractors to pay
One client shared that each new large contract required an upfront operational buffer of $70k to $150k before any payment came in. Without a funding strategy, they literally couldn’t grow even when opportunities were right in front of them.
That’s why some businesses, especially freight forwarders and haulage operators, rely on tools aligned with improving cash flow with invoice financing whenever they’re scaling up.
Speed Matters More Than Anything Else
Logistics operates on tight timelines. If you’re waiting three weeks for a decision from a financier, you’ve already lost momentum.
Many SMEs tell us speed matters more than cost. A transport company said:
“I’d rather pay a small fee for fast cash today than pay nothing but lose a $200k contract.”
This is why approaches that feel like fast invoice financing for transport companies with long payment terms exist. It’s not about convenience, it’s about operational survival.
Sometimes you need funds within 24 to 48 hours, not the following month.
What We’ve Learned After Working With Logistics Clients Across Singapore
Over dozens of conversations, a few patterns keep showing up:
- Receivables stack up fast
Some SMEs carry $300k to $800k in outstanding invoices monthly. - Invoices aren’t the issue — timing is
Logistics firms almost always get paid eventually. It’s just the wait. - Cash flow tools help businesses accept more jobs
One warehouse operator said they increased monthly volume by 22% after securing predictable cash flow. - Staff retention improves when salaries are stable
A logistics company with 14 drivers told us salary stability reduced turnover dramatically. - Owners feel significantly less stressed
You can’t put a number on peace of mind, but every owner mentioned this.
These insights repeat across warehousing, freight forwarding, cross-border trucking, container haulage, and last-mile delivery.
So Where Does This Leave Logistics Companies?
Logistics in Singapore is world-class, but its payment cycles are definitely not world-class. You can deliver a container from Pasir Panjang to Changi in 40 minutes, but collecting payment can take 40 days.
This mismatch creates a working capital itch that’s hard to ignore.
It’s why more companies naturally incorporate invoice financing providers for freight and haulage businesses, choosing flexible funding not as a replacement for traditional loans, but as a companion that matches how fast logistics needs to move.
It’s not about taking on debt.
It’s about smoothing the bump between work completed and money received.
And in this industry, that bump can make a world of difference.
Ready To Explore A Working Capital Approach That Matches Your Operations?
Every logistics business has its own pace. Some advance $30k a month, others $300k. Some do it occasionally, others build it into their structure.
If you’re looking for guidance or want to test something small, speak with a consultancy that understands the logistics sector deeply.
Approved Consultancy works closely with haulers, forwarders, trucking operators, warehouse companies, transport SMEs, and freight subcontractors managing 30–90 day cycles.
