After months of sheltering in place and watching cities and neighborhoods close up shop due to the coronavirus, it seems that many of us are starting to peek our heads out the window again. Meanwhile, many critical industries, from healthcare to transportation, kept the country and the U.S. economy afloat through its darkest time.
Knowing that the trucking industry played an essential role during the pandemic, hauling food and medical supplies to critical areas around the country, we wanted to know just how much had changed due to COVID-19. KCD PR sat down with Justin King, Senior Vice President of North America Trucking for Comdata to discuss the highs, lows, and future of the transportation industry.
Justin King, Comdata
KCD PR: Comdata has been in the transportation space for years with its payment solutions. Did you find that customers using Comdata were better equipped to handle the pandemic when it began?
Justin King: What Comdata has done in the past few years is really transform the way drivers get paid and have access to funds. Our payment solutions enable a faster, easier, and contactless method of payment, particularly when purchasing fuel. When the coronavirus hit, there was a lot of fear across every industry about how to conduct business without any contact. That can be a very difficult thing to do even in the transportation industry where it seems drivers are already isolated from others when they’re on the road. What really helped these fleet owners and drivers during this time, however, was the ability to socially distance while doing the important work they do.
For instance, drivers can use funds loaded to their Comdata OnRoad card to make digital payments and money transfers via the OnRoad mobile app. This is simply a more convenient way to exchange money overall, but it became even more helpful when it allowed drivers to exchange funds without meeting in-person or needing to touch surfaces that could spread the virus.
KCD PR: How could this pandemic change the way the transportation industry conducts business in the future?
Justin: The transportation industry was always headed in this direction of contactless payments, even before the pandemic hit. It may have just been a slower process before because digital transformation requires overhauling legacy systems and overcoming organizational inertia. The trucking industry is a lot like the U.S. Post Office – it’s a massive industry that’s been around for a long time and is heavily regulated. Innovation doesn’t come naturally to this industry for these reasons, but it doesn’t make it impossible.
If you look at some of the payment innovations from the last few years, consumers have started to embrace – and even demand – digital wallets or the ability to exchange money through mobile apps. Consumers now have Apply Pay, Venmo, Stripe, Square – the list goes on. What we are seeing now is an increase in demand for effortless and convenient payment solutions for truckers while they’re on the road. The pandemic has only accelerated this digital transformation for the industry. The companies that refuse to transform will not survive if there’s another wave of coronavirus.
KCD PR: What new trends have you seen in the recent months since the start of COVID-19 in regard to factoring?
Justin: We’ve seen a greater need for smaller fleets to be able to access capital and the funds from their shipments a lot faster than before. With so many non-essential businesses forced to close down, there was a greater risk that many would not come back after the pandemic. What many people don’t know is that a shipment invoice can take 30 days on average to fully process for the trucking fleet. That means going almost a month without getting paid for a shipment, which is too risky during an uncertain economic climate. The domino effect of one business going under is frightening.
The companies that refuse to transform will not survive if there’s another wave of coronavirus.
A few months ago, we partnered with Crestmark, a division of Metabank, to offer our customers Comdata QuickPay, a service that provides them access to factoring services that will ensure they can access the funds from shipments within 24 hours with the option to incorporate those funds straight to their fleet’s Comdata cards. We created this solution long before the pandemic, and it demonstrates the importance of evolving your business to withstand these economic curveballs.
No one could have predicted the impact that COVID-19 would have on the transportation industry. We still don’t know fully what the outcome will be, but it’s clear that having access to digital payment solutions are going to be the must-have tool of the next ten years.