Jason,

Without seeing the balance sheet (but having worked in transportation), you should just have AR from the shippers (avg[redacted]DSO for small shippers and[redacted]for the really big players who have leverage), AP due to the carriers (I would ballpark terms can range from 7 days to 30 days) and AP for your employees doing the brokerage (duration being the payroll). Is that in line with what you're seeing thus far? An asset light business where NWC really should be your only growth constraint.

Tyler

I think Tyler has a good answer here. We just exited a freight brokerage and we’re able to add almost $1mm to the investor return by managing WC on the way in and playing it well on the way out so your attentiveness to this area is important

Cash to cash cycle time is the lifeblood of the transportation industry. Net 30 days is the industry standard from receiving carrier invoice. This time allows you cash float and use sweep accounts before paying carriers. You can negotiate with you shippers to be paid faster for .5-1% deduction on gross profit. Make sure you have non-solicitation, non-competes and confidentially agreements in place with every agent/employee. 3PL is very much a personal relationship based industry. Low cost leader is generally the winner.