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At This Booming Trucking Finance Company, She’s The Boss

JC Reindl The Detroit News

WWR Article Summary (tl;dr) As JC Reindl reports, "[Jagdeep] Dhillon, who goes by the nickname "Deep" at work, said she knows of few other female owners of trucking financial services businesses. Her daughter, Simran Dhillon, said people are often surprised to learn that her mom is the boss at RoadEx."

Detroit

A trucking financial services company in metro Detroit is seeing rapid growth and anticipates doubling its revenue this year compared with before the COVID-19 pandemic.

Livonia, Michigan-based RoadEx was started in 2014 by Jagdeep Dhillon, who had run a trucking company previously with her husband. She attributes RoadEx's growth spurt to pandemic-related increases in demand for shipped goods, plus the company's 2020 and 2021 decisions to expand services for its customer base of mostly small and mid-size truck carriers and owner-operators.

RoadEx's revenue has grown from $60 million in 2019 to an anticipated $130 million for all of 2021. It is rare for companies in the trucking industry to be owned or run by women, and only about 12% of the industry's workforce was female in 2020, according to the U.S. Bureau of Labor Statistics.

RoadEx has about 30 full-time employees working out of its Livonia office, plus an additional 15 employees based overseas in India. The company was previously known as Flat Rate Funding Group prior to rebranding last year as RoadEx.

The company does not own or operate big rigs. Rather, it offers financial services to trucking companies, generally those with fleets of one to 20 trucks, although a few of its customers are bigger.

One of RoadEx's primary services is known as freight factoring, which involves providing funds to trucking companies in exchange for buying their accounts receivable.

Trucking companies use factoring because they have substantial upfront costs like fuel and repairs, and the businesses that receive their deliveries can take 30 days, 45 days or even longer to pay. An average invoice per truck delivery is about $2,300.

"They need cash flow all the time to pay their drivers and pay for fuel," said Dhillon, who chairs the company.

Factoring providers such as RoadEx buy invoices for slightly less than the amount owed, roughly 95%-97%. They later earn profit as businesses pay the invoices.

RoadEx finances its factoring activity through a mix of money on its own balance sheet, plus bank borrowings, according to Dhillon.

The trucking industry is notorious for add-on and hidden fees in contracts. Kevin Main, co-owner of Florida-based Winstar Total Logistics, a trucking company with 26 trucks that uses RoadEx for factoring, said he appreciates how the company is transparent.

"What I like about RoadEx is when I look through my contract, like everybody should for dispatching and for fuel and for factoring, there is nothing hidden — everything is right out there for me," he said. "It is very easy to understand ... and that's why I've stayed."

Through the years RoadEx has steadily added services, including truck dispatching, which is setting up truckers' routes and finding loads for them to pick up and deliver.

Without dispatching, trucking companies run the risk of having little or nothing to haul on their journey back from a distant location. Dispatchers generally take a portion of the payment for each load that they find for the trucker.

A dispatcher is different from a freight broker, which acts as a middleman between the shipper and the trucking company.

Other services offered by RoadEx include truck insurance, emergency loans and fuel savings credit cards. "We provide five different services — usually factoring companies don't provide all of them," Dhillon said. Brother in trucking

Although neither Dhillon nor her husband ever worked as a truck driver, Jagdeep Dhillon became acquainted with the industry's financial service needs from her brother, who started driving trucks after immigrating to Canada from India.

Dhillon also was born in India and immigrated to Canada in 1994 at age 22. She is from the Punjab region in India, and the Punjabi community at large has deep roots in the trucking industry in the U.S. and Canada.

She and her husband started a trucking company in Canada in 2005. They later closed that company once they moved to the U.S. in 2012.

Here they started a new general freight trucking company, Romulus-based DF Carrier, which they sold in 2017 to focus on growing what is now RoadEx. Proceeds from the sale helped Dhillon to invest more in RoadEx and its growth, she said.

Dhillon, who goes by the nickname "Deep" at work, said she knows of few other female owners of trucking financial services businesses.

Her daughter, Simran Dhillon, said people are often surprised to learn that her mom is the boss at RoadEx. "You would hear her on the phone and (callers) would be like 'Can we speak to whoever is in charge?' And she is like, 'It doesn't get any more in charge than me,'" her daughter said. "And they are like, 'How about the owner or the manager?' and she is like, 'that's me.' "

Deep Dhillon said some of the supply chain delays now in the news are exacerbated by a shortage of trailers in addition to truck drivers.

"Right now, it's very hard to get a trailer," she said. "We have so many companies where they have drivers, they have trucks, but they don't have trailers."

Distributed by Tribune Content Agency, LLC.

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