Factoring invoices is advantageous for numerous reasons. It allows a truck firm to raise money without acquiring new financial obligation. While debt is often required, most truck companies would choose to raise cash without borrowing money. Debt is high-risk, and when it cannot be paid back, possessions can be repossessed. If the financial obligation is huge enough, it could even force a truck companies out of business.
How Much is Your Cash Flow "Tension" Costing Your Company - Choose
A Freight Bill�Factoring Company Instead Of A Typical Bank Funding
Exactly how to Increase Money Flow Without Loaning -Cash Money flow is among the primary reasons companies fail.
At one time or another, every company, even effective ones, have actually experienced poor cash flow.
Cash flow does not have to be a problem any ever more. Do not be fooled -- banks are not the only locations you can get financing. Other solutions are offered and you do not have to borrow. What is truck factoring ? One option is called factoring services for trucking companies. Truck Factoring is the process of selling invoices to a financier instead of waiting to gather the money from the
customer. Oh, the Irony- Trucking factoring has a paradoxical difference:
It is the financial
foundation of numerous of America's most successful companies. Why is this ironic ? Since trucking factoring is not taught in business colleges, is rarely mentioned in company plans and is fairly unknown to bulk of most of American company individuals.
Yet it is a financial procedure that frees billions of dollars every year, enabling countless businesses to grow and succeed. FACTORING has been around for thousands of years. Trucking Factoring Businesses are investors who pay cash for the right to receive the future payments on your invoices. An unpaid receivable or invoice has value. It is a debt your customer has actually to pay in the near future. Factoring Principals--Although factoring
deals solely with business-to-business transactions, a big percentage of the retail business uses a factoring principal. MasterCard, Visa, and American Express all use a type of factoring in their retail transactions. Using the purest meaning of the word, these large consumer finance business are really just large Receivable Loan Financing Companies of customer paper. Consider it: You make a purchase at Sears and charge
it to your MasterCard. The store makes money almost instantly, although you do not pay up until you are prepared.
For this service, the credit card company charges Sears a charge (typical common normal charges range from two to four percent of the sale). The Advantages Factoring can provide many benefits to cash-hungry business. Rather than wait 30, 60, 90 days or longer for payment on an item that has actually currently been provided, a company can factor
(sell) its receivables for money at a small price cut
off the dollar value of
the invoice. Payroll, advertising efforts, and working capital are just a few of the company needs that can be met with instant cash.
Factoring Services For Trucking Companies offers the ways for a manufacturer to renew stock and make even more items to sell: There is no longer a requirement to wait for earlier sales to be paid. FACTORING is not simply a cash management device for manufacturers: Practically any type company can benefit from Truck Factoring. Typically, a company that extends credit
will have 10 to 20 percent
of its annual sales bound in accounts receivable at any given time. Think for a minute about exactly how much is tied up in 60 days' worth of invoices: You can not pay the power bill or this week s payroll with a client s invoice, however you can sell that invoice for the cash to meet those obligations. Using trucking factoring companies is a quick and easy process. The factor buys the invoice at a price cut, usually a couple of portion
points less than the stated value of the invoice.
Please call our freight bill factoring specialists at 1 - 888-239-9162
or E-mail Us
The American Truck Association
specifies that there are about
195,000 work with transportation
250,000 personal service providers trucking
companies certified to
run in the United States that transferred,
according to their most current searchings for billions of
items, materials and
basic materials .
There are numerous common
groups on our nation
highways transferring these
important products to our
stores, factories and harbors.
Furthermorefreight invoice factoring
countless of them and offer their
receivable loan facilities
including the following states.
Alaska, Arizona, Arkansas,
California, Colorado, Connecticut, Delaware,Florida,
Georgia, Hawaii, Idaho State,Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine,
Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska,
Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina,
North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina,
South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West Virginia,
Wisconsin, and Wyoming
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Trucking Companies serving to/from points within the United States, categorized by services offered. United States Trucking Companies will be listed under all categories in which they provide specified Trucking Services. To find companies offering specific Trucking Services in the United States, click on the list of services below.
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Click below to find Trucking Companies in the United States:
Trucking Companies serving to/from points within the United States, categorized by services offered. United States Trucking Companies will be listed under all categories in which they provide specified Trucking Services. To find companies offering specific Trucking Services in the United States, click on the list of services below.
If you're like most drivers, you're looking for a better company in trucking that might be offering the best jobs in terms of pay, freight, and hometime ' not to mention benefits or a sign on bonus. We've got all of our clients listed based on the states where they're hiring, so you can quickly find the best job in your home state. You'll see the very best nationwide trucking companies that have positions available.
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The largest trucking companies in the U.S. set a revenue record in 2013, but revenuegrowth slowed for the second year in a row.
The combined revenue of the 50 largest motor carriers rose to $106.6 billion last year, according to The JOC Top 50 Trucking Companies list, based on data prepared by SJ Consulting Group in Pittsburgh.
Green Truck & Haul have been operating their business since the mid 1980s. They've delivered goods for nearly every major industry in the nation and for 20 plus years, business was booming as they've traversed the country in all weather for all clients. During the heady times from 2002 to 2007, Green was a top rated accounts receivable mastermind of the trucking industry. Few customers were ever late on bills and those clients who were, were sure to turn in their late payments within a reasonable amount of time. Times were great for everyone, and the cash was flowing.It was just one year later, in 2008, when the economy in the United States took a sharp decline, and both large and small businesses started to notice the squeeze on their pocketbooks: everyone had suddenly gone silent. Business slowed to a crawl
. And worse yet, Green had noticed during the early part of 2008 that though the bulk of their clients were always on time with payments, the few late-bloomers there were, had seemingly started to spread this illness. And as spring turmed to summer and summer into the early days of fall, Andrew Austin, CEO of Green felt a chill go down his spine whenever he would look at the weekly A/R reports. The numbers of clients who owed him back debt were growing.He had already been to the administrators to ask what the actual problem was. Were they doing something wrong or different when it came to reaching out to delinquent accounts? When checking his bookkeeper's records this was definitely not the case. Perhaps he was losing his customers to his competitor, who seemed to offer very low prices with no guarantee of quality or performance, and these clients who were in debt to his company had possibly disappeared leaving him stranded. Perhaps they were unable to pay their debt to him, but were able to meet the costs of a lesser service. So he did the necessary research and, after discussions with friends in the same field, he realised that no, his customers hadn't gone anywhere else. The had just gone!.The situation looked dire to Andrew Austin. There were goods to ship, employees to pay, trucks to repair and maintain, and continuous overheads that were very extensive when compared to the funds (or lack of) that were incoming. After work he would confide in his wife, Virginia, and neither were unable to stop the constant worry over the lack of funds.""I have a bad feeling, Lin,"" he'd sadly say to his wife.""What could you do differently?"" she would ask.Andrew would stare off into the distance, and then slowly close his eyes. In his mind he could clearly see the fleet of trucks purchased over the many years. He could see them traveling, bringing goods to all of his clients. But then a haze would cover his trucks and his vast fleet would vanish to leave just a few. Why couldn�t he work out how to resolve this financial problem with his business?""I think I know what it could be,"" Andrew said. ""I've relied too long on the profits I receive from invoices alone. For too long I've been allowing our clients to let their accounts become overdue."" Linda could only grab her husband's hand and look at him lovingly, ""It's a hard economy. It might be awhile until things get settled up.
""Andrew knew very well that Virginia was only trying to help, but his responsibilities weighed heavily on his shoulders and he knew he had better do something soon to resolve this situation.The following day Andrew walked into his office with a spring in his step, determined to call each and every client who owed money to Green Truck & Haul. This wasn't really a very efficient way for a Chief Executive to spend his day, and Andrew knew he should be overseeing all the other sides of the business, such as shipments and deliveries, approaching prospective customers, or working with his sales team. Even though he was doing something to help his company, he knew he had folks on salary to do just this thing. Wasting money, wasting time - even with the best of intentions, Andrew knew that he was in trouble.
Poor Andrew spent the whole morning trying in vain to contact his debtors: they promised to call back, dodged his calls, or made small interest-only payments. He was beginning to feel quite despaired when his secretary knocked on his door.
""Can I have a word with you Andrew?"" she queried, standing in the doorway.
""Of course Agnes, please come in."" Andrew leaned back in his chair and looked expectantly at Agneserely.""Well Andrew, this afternoon I did some research, trying to work out how we're going to get out of this mess."" She opened up a folder she had been carrying and pulled out a small wad of papers, placing them on the desk in front of him.""Have you ever heard of factoring?"" Agneserley asked.""It does sound vaguely familiar. What is factoring""? he asked.""Well,"" she began, ""It�s actually quite simple really.
So basically, factoring invoices would enable us to get paid on the nose for loads that we haul.""""Immediately?"" Andrew interrupted.""Immediately, yes"" she added, ""In a nutshell, it's pretty easy. We start by having a professional account manager review our figures and help us set up a company profile. That profile will also include investigating our accounts receivable aging reports, our existing customer credit limits and so on. In addition, factoring will assist in determining our customers' creditworthiness, independent from their credit relationship with our company. It�s a broad view.��I see,� Andrew said. �And then what?��Following the completion of their review and once we've been approved for a contract with the factoring company, then we sit down to negotiate conditions and terms. There�s a lot of flexibility depending on the business volume and credit histories. The company will advise us the cost to purchase factoring for our company's accounts receivable. The funding commences once we�ve arrived at an agreement.�Andrew leaned forward and reviewed the paperwork closely.""I don't know, Agnes - it just sounds too good to be true"", Andrew said quietly.""Yes, I know; that's exactly what I thought at the beginning. But really, they have guaranteed us experts that do all the legwork, which would free us up here to focus on our clients in good standing and marketing, all that good stuff. And they're flexible Andrew,"" she drew a circle around a paragraph on the document before him.""How flexible?"" asked Andrew.""It seems that they personalize their factoring charges so that the amount they're prepared to work with is commensurate with our client's debt and our needs. It only takes 2 to 4 days for this to be figured out. """"It does all sound pretty good, remembering that we're all tapped out now with loans from the bank last year to repair vehicles, and we all know just how tight money is. It's imperative that we keep the business rolling as usual, and every day we go unpaid we're getting closer and closer to dealing with some serious issues in both the short term and the long term,"" Andrew said.Andrew took in a long slow breath, then looked at his secretary with something like hope in his eyes.""Exactly�. I think this might just be a way out of the trouble we're in with these folks who owe us money.""Andrew thought about this and agreed with Agneserley. The clients who owed them money were long standing friends and professional resources of Green. Just because they were experiencing difficulties paying their own bills now, Andrew was very concerned about losing these relationships. Andrew knew only too well that the whole economy was floundering, and that it was not going to change overnight. That unknown amount of time could create a disaster situation for both of them if he wasn't careful in how these debtors were handled. He didn't want to lose business but he also didn't want to lose any more money.""Let me go over this tonight Agnes, and thankyou."" Agnes nodded, satisfied with her work, and she left the office feeling quite content in the knowledge that she had helped Andrew keep the shirt on his back, and possibly hers too.Andrew stayed at his desk for a long time, looking over the details they hadn't discussed during their meeting. What other issues could freight factoring help Green with? Running his pencil down the sheet, he noted that the freight factoring company could assist with fuel costs, fuel advances, and fuel discount cards. Andrew was surprised: it said that his company could get up to fifty percent cash advances on load pickups. As a man who hated binding contracts with no room to breathe, he was pleased to see that this factoring company would not make him sign a long term contract, would not make him pay any sign up fees and there was no minimum volume required.""Well, I'll have to tell Barry about this,"" Andrew muttered to himself.Barry is Andrew's son-in-law, and he really admired the ideas behind Green, so much so that only two years before he had started his own transportation service business. At that time Andrew knew the struggles Barry would face, but he still encouraged him to follow his dream. With the economy the way it was, if an established company such as Green was struggling then the little guys, like Barry, were going to be in even more trouble.
But, an antidote may have been found in freight factoring and Andrew was soon to find out.A few short months later, after completing the application process, having the legal experts review his credit history, accounts receivable, and statements, finally Andrew was beginning to find his way out of the hole his debtors had created for him.They adopted reasonable factoring purchase contracts and stopped wasting their own precious time trying to collect debts. They took that time and refocused effort to offering competitive prices in new territories. Andrew recalled those dismal months when he wasn't aware of freight factoring, and he shuddered at those memories. If Andrew hadn't discovered freight factoring at just the right time, his business may not be operating today.
More Trucking Factoring Companies Story Articles
The Future of a Trucking Company, and Factoring Phillip Patterson let the phone ring on his desk. His morning coffee cooled and his cigarette smoked away in the tray: Phillip is thinking, and pondering the biggest decision he's ever had to make for his trucking business. Patterson Trucking Company was at a turning point of growth and Phillip had to decide if signing with a factoring company was the right way forward.
More than forty years ago Phillip's father had started this business working as an owner-operator and eventually growing Patterson Trucking Company into a fifteen trailer fleet. Yes, they had survived some very difficult times when it appeared like they might go under, and even Phillip's mother had jumped into the cab at times to make hauls. His father had worked long enough to see the price of hires drop dramatically during the recession and to see the explosion of fuel prices afterwards. Now the company was solely in Phillip�s hands and he wanted to live to see it in better shape for his sons.
To move Patterson Trucking Company ahead into the future, he needed a steady cash flow but there was just not enough money to go around. He had employees to pay. They had families and household bills too. Some of the refrigerated trailers were in need of repairs and he felt to stay competitive it was also a good idea to invest in specialized haulers to be ready for the constant requests he was getting for loads of new energy and agriculture equipment. Every time he had to turn down a request, Patterson Trucking looked weak in a very strong market.
His father would have told him to wait and to take his time adding on new technology. Phillip chuckled, thinking about his father. He remembered when his father was totally against installing GPS units in the cabs. His Dad would say ""Why on earth do you need some stranger telling you to get off the exit that everyone knows has been there for years?� He smiled to himself as he remembered his father poking fun at the other drivers who switched to automatic, even though automatic was quite obviously more efficient (though less manly). He knew his father's days were long gone and new technology was very important for the business, like having Qualcomm to reduce communication time for bills of lading.
Phillip knew he was right in his forward thinking. What would be the next step for Patterson Trucking? More importantly, how could he afford it? Funding was all tied up in the mortgage for the office and garage and in the fuel bills. He just finished paying off the small bank loan for installing satellite radio in the trucks for the guys.
But was factoring the answer? There was a lot he didn�t understand about the process. It sounded like a ninth grade math problem and he wondered how this would fit into the trucking business. Factoring companies buy your invoices and manage your accounts receivable for a certain percentage of the invoiced amount. In return, the factoring company pays the trucking business straight away, providing immediate cash flow for the business to pay staff, purchase fuel, and do any repairs or maintenance. Without the assistance of factoring, you have to wait for customers to send you the payment which is often 30 days late. During those thirty days the trucking company can't pay its employees and bills with invoices.
Now it was time for Phillip to do his homework. Phillip had heard that there were companies that charged for same day money transfers and would only advance a percentage of the money owed to your company while holding the rest in a private account if they didn�t get their bill payment within 60 or so days. Worse still, if the customer defaulted on payment, the factoring company takes it out of the money supposedly coming to you! Through the grapevine, he�d also heard about how some companies suddenly slipped you onto a sliding scale of percentages even if you had already signed a lengthy contract for maybe 3% or 7% so there you are with 10% coming as a cost to you out of the freight bill. His friend Ronnie who had a trucking business in Missouri, was run nearly into the ground by a factoring company that charged him the full freight bill on top of the factoring fees. He knew he would have to be very careful if he was to avoid any of these shady companies?
However, it all turned out to be very simple. All the factoring companies he researched were open about their business practices and very friendly on the phone when he called. Their customer service actually knew things about their company and spoke in nice clear English so he could understand what was being explained. He was quite happy to sign an exclusive contract. He liked the idea of a long term commitment so he knew he wouldn�t have to bother going back and forth to different companies and wasting time filing more forms. Nobody charged him for credit checks and they offered him a fuel advance on the pick-up of the load. Many companies offered a non-recourse factoring program that suited him just fine. He was more than happy with the figures he was offered in percentage terms on the freight bills. It was good money.
It was really refreshing dealing with the factoring people. They were more personable than those loan managers at the bank. He was relieved to note that the factoring companies understood the trucking business and discussed business with him like a respected client, not like someone looking for a handout. The factoring companies didn�t worry over his credit and the debt troubles his father had had in the past of the company. All the factoring company was interest in was the credit of his customers and on their reliability: this worked great for Phillip because he and his father had created a very strong and loyal list of clientele over the years. So he knew they would understand when the factoring company contacted them for the invoices. His clients wouldn�t think poorly of Patterson Trucking and the factoring companies appeared capable of handling the accounts receivable in the same polite manner that his father had used over the years.
Phillip stepped out of his office to let his secretary know to expect the arrival of the factoring contract shortly. He felt exhilarated by the new possibilities that would make the future of the company fun again and put the stress of the difficult times behind him. He suddenly realized that, with this new cash flow, he could actually expand Patterson Trucking Company and who knows, move into Canada, which had always been his dream. His heart felt full knowing his sons wouldn�t have to worry about money because of the right decisions he had made for their trucking business.
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Trucking Factoring Articles
�So, this is not a loan?� Clinton Thomas asked as he leaned back in his chair, crossing his legs. The woman sitting across the desk from Clinton smiled at him, shaking her head.�Not quite,� she stated.Clinton was the owner of a small trucking company which had fallen on some hard times recently. Trucking could be a profitable business, and for a little under a decade, it had been for Wade. He named his business Baker Trucking, named after Oscar and Dave, his two grandfathers. Both of these men had been very hardworking and had set a great example for Wade.Disaster had struck half a year ago, when two trucks in Wade�s fifteen truck fleet went down. One was a roll-over and ended up in the trucking graveyard: the other was involved in a serious and costly accident. Clinton depended on his full fleet, and missing two trucks was devastating . In addition, he just didn't have the available cash to buy a new truck, plus repair the other one.Paying of bills in the trucking industry is always a major cause for concern for businesses.
You could go a month or more before bills were completely paid off. In the long run, this wasn�t an issue, but if problems arose, you could find yourself in trouble.Clinton wasn�t a bad owner, and he hadn�t messed up. Things had happened that he couldn't have predicted, and he had to figure out a way to keep his business from hurting, or even going under.And that's why he found himself across the desk from this woman. Her name was Brenda and she worked for a factoring company. He had accidentally come across her company one night when he was working late, searching the internet to see if there was some solution to his financial dilemma.Brenda explained. �it is really not a loan at all: we actually buy your accounts receivable. We're not giving you finance to be repaid later: we're purchasing something from you, and when you can you can buy it back. This is a win-win situation: we're protected from a total loss, and you're protected from the ridiculous fees and charges you'd have to pay if you borrowed from a bank.Clinton nodded. It sounded good to him, almost too good.Brenda laughed. �I'm not sure that you believe me,� she chuckled.�Oh no, I do: it just sounds too good to be true. I thought I was going to lose my company.�Brenda nodded. �We get that a lot. Listen, I�d hate to see you lose your company. We know how hard you work, and that you've invested everything in your business. Sometimes you need help. That�s what we�re here for.��In any case, thank you for coming to see me.��It�s right down the road, usually we do it all online, but I didn�t mind swinging on by today,� Brenda said with a smile. �Let's work out a solution to your problem.�And with that they set about making a profile.
Clinton completed the form, with Brenda offering advice as needed.
The profile filled Brenda and her company in on Wade�s company, and would help them determine if he was suitable for factoring. In truth, not all companies were. Some were beyond factoring special brand of help, and sometimes things weren�t even dire enough for it. Listening as Clinton filled out his form, Brenda was pretty sure he was a perfect candidate for factoring.Brenda took the completed form and placed it in her briefcase. Standing up, she reached over the desk and shook Wade's hand. He stood before they shook as well, and then smiled. They said their goodbyes and Clinton walked her to the door, and then returned to his office.His employees were there, seven who worked in the office, and as he sat behind his desk once more he heard the familiar clack of fingers on keyboards, the electronic whine of the copy machine.He leaned back and closed his eyes. He felt so drained: he had been flailing helplessly for so long, he just knew his business was going to collapse and probably take him with it. Talking to Brenda though, learning about factoring, it felt like a weight had been lifted from his shoulders. He relaxed into his chair, running his hand through his thick black hair with its telling streaks of grey.All those long, sleepless nights. The terrifying panic attacks that occurred regardless of where he was. He could feel it all fading away. He knew it wasn't over yet and that there was still a way to go, but he could just feel everything start to change for him. He was still here; he knew this was the right path for him, and he felt proud that he had taken the appropriate steps to sort out his problems.Clinton couldn�t help but think back to when he had first started the business. At twenty-two and straight out of school he had opened a restaurant. It had been really successful. Offering home cooking in his own hometown, his business had really prospered.But it wasn't what he really wanted to do. He wasn't passionate about the food industry. He thought long and hard, and then he decided to sell the restaurant. He took half a year off, and in that time he thought to start Baker Trucking. And that's exactly what he did. Once again he built a company from the ground up. He had been successful.And then the trucks went down, and his success looked to be in flux. He was nearing fifty. He was concerned that he just didn't have the energy left to try and save the business. But giving up wasn't part of his personality either.
The idea of cutting his losses, shutting down, laying off his workers, it actually made him sick some nights. He didn�t know how to say quit.And now it seemed as though he wouldn't have to - all because of Factoring. Clinton opened his eyes, sat forward, turned his computer on. He had things to do. There would be plenty of time later to be thankful, but for now it was time to get back to work.
More Trucking Factoring Company Story Articles
Why Truck Firms Make use of Factoring Companies.
As the manager of your own business enterprise, you may perhaps be much more than mindful already of the challenge in making sure that cash flow issues do not become a problem down the line. Anyway, the worst thing that can quite possibly come about for your company is to find yourself embroiled in a long and challenging predicament that leaves you forever looking for the money you necessitate on an continuing manner.
For any firm in this circumstance, the dilemma can come for waiting for work to lapse and actually be paid out into your bank account. Invoices, checks, and the like can take a long time to actually to be taken care of which can certainly leave you with temporary capital issues. Luckily, there are alternatives out there for firms to consider-- and one of these is factoring companies.
Factoring companies will, in trade for your bill of sales, give you with the cash now in order that you don't have to fret about the waiting duration which could make paying the bills and getting materialsmore challenging. With this sort of system, invoice factoring can become remarkably practical for various establishments who need to get out of a money lure which they have gotten themselves in.
For the reason that, depending on the scale of the task, it can take up to 60 days for many businesses to get paid then it's significant to take care of your own back and definitely not leave yourself money short to pay the costs. After all, how many businesses have two months profits just occupying there to pay for all their overheads until they get paid?
This is specifically true of trucking establishments. They often tend to deal with good deals of accounts which means a serious amount of collection period entails company owner themselves. Striving to get paid in time can end up being an incredible difficulty and this is the key reasons why you employ trucking factoring companies who are pleased to help out truckers particularly.
As we all know, trucking is an amazingly large field with lots of organizations out there employing hundreds of vehicle drivers. However, many of these drivers land up in cash troubles since they are still waiting for work from six weeks previously to actually pay them. When this is the situation for a trucking agency, depending on factoring firms for assistance may be the most ideal alternative left.
This means that a trucking organization can pay out the salaries of the people, keep all the cars refilled with fuel and continue to surmount, evolve and expand without constantly waiting for the funds which is taking too long to come in. Trucking Establishments functioning without a factoring system established are leaving themselves at critical risk, as contenders cash out promptly and continue to expand.
There's absolutely nothing at all to be troubled about when it comes to utilizing a Factoring agency-- they usually are not like a financial institution or any individual who is going to leave you with a massive stockpile of financial debt to repay. You give them legitimate invoices from job you have already completed , you are only speeding up the repayment process.
In the United States, where trucking establishments survive, factoring providers are not considered getting a loan in any capacity. This private agreement then allows both groups to make money and indulge in a worry-free future-- it gives the factoring firm a guaranteed asset of earnings to put into the list and it offers the trucking firm the needed finances that they sweated to gain.
The trucking company bestows their accounts to the factoring firm. The trucking factoring company then receive the payment amounts from the trucking company's clients. Factoring has been in existence for hundreds of years and has been utilized for decades by several varying markets-- but none exceeding so than truckers. While you may miss out on a small part of the money, something like 1-3 % depending upon who you work with, it means that you are getting the cash today and can actually start setting the cash to work.
Anyway, an IOU or an invoice is absolutely not going to finance bills, is it? For trucking firms when the money can be excellent one day and gone the next, it's up to the vehicle drivers to work prudently and to ensure they are leaving themselves with a significant amount of time and money to get through the week till they are paid again.
So the next instance your trucking enterprise is enduring some momentary capital issues and you are spending an excessive amount of time chasing slowly paying clienteles, why not start off looking at making use of a factoring companies as a way to get your cash and give yourself a more comfortable future in the eyes of your trucking staff and your bank dividend?
Bank loans are an extremely traditional way for a business to get financing. These loans can be a life-saver, but they're not always available to every business. For example, a fairly newly established business simply may not have the assets to readily get a loan from a bank, even if they do, the standard collateral for a business loan is the business itself, which means that if you cannot make your loan payment, you risk losing your entire business. In addition, while you apply for a certain loan amount, that is all the financing you are entitled to. Of course, once that loan has been re-paid, you can always re-apply for another loan.
What Are Trucking Factoring Companies?
Trucking Factoring companies don't offer loans, and you don't go into debt when you get money from a Trucking Factoring company. The finance you receive from the Trucking Factoring company is determined by money already earned by your business, but not yet received. The Trucking Factoring company purchases your accounts receivable, or part of them, for a certain percentage of their value - this is normally about 80-95%. The amount of finance you can receive will be based on the amount you have earned and the accounts receivable you are prepared to 'sell.' Once you have set up Trucking Factoring account it continues as long as you wish it too and the amount of money available to you even can grow as your business grows, giving you the ready cash you need to meet your own obligations.
Benefits of a Trucking Factoring Company Vs. A Bank Loan
While not every business can take advantage of Trucking Factoring account financing (you have to have a business that has account receivables) for those that can use this type of financing there are several distinct benefits.
1. You Won't Incur Debt. Since the Trucking Factoring company actually buys your accounts receivable you don't actually incur debt like you do with a bank loan. This has many benefits including the fact, that this type of financing won't affect either your business credit rating or your personal credit rating. In the event that your business fails, you wouldn't have to be concerned about someone coming after your personal or your business assets in order to pay off a loan. With a bank loan, the debt goes onto your credit report, and even one late payment can adversely affect your businesses credit, and even the ability to get insurance and may even reflect upon your personal credit rating.
2. No Collateral Required. Another great benefit of using the services of a Trucking Factoring company instead of a bank loan is that there is no collateral required for the Trucking Factoring company, because the Trucking Factoring company is 'buying' your accounts receivables. Plus, the state of your credit rating is not an issue; however the Trucking Factoring company will run a credit check on your clients whose accounts receivable are being offered for financing. This means that it's easier for new businesses to access the finance they need through a Trucking Factoring company, providing their accounts receivable are in good order. A bank may believe you haven't been in business long enough to be able to cover this risk.
3. Receive Your Money Faster. With a Trucking Factoring company you can actually get the money you need faster. The money will normally be in your account within 24 hours, once the Trucking Factoring company is confident that your customers� accounts are likely to be paid. Borrowing from a bank begins with vast amounts of paperwork, the loan must be underwritten, and this can take ages before you're notified if the loan has been approved.
4.You receive interest up-front. Unlike a bank loan that continues to build interest that you have to pay the entire time you have your business loan with a Trucking Factoring company, you don't have to continue to pay interest as they take it right off the top, deducting it from the total amount of accounts receivable. So you don't have to worry about monthly loan repayments, and you don't have to worry about the amount of interest payable, because all the money in the account is yours to spend.
As you can see from the above, there are some great benefits to financing through a Trucking Factoring company, and not through a traditional bank loan. However, there are also a couple of other benefits that a factory company can offer your business is far beyond the scope of the bank. The main benefit is that once you've sold your accounts receivable to the Trucking Factoring company, you are free from having to collect money owed by your customers. The Trucking Factoring company takes over that chore, since it is now their money to collect. Trucking Factoring companies are very good at collecting these debts, saving you the time and effort that you need to devote to your growing company.
Another bonus is that, because the Trucking Factoring company has evaluated the quality of your customers' credit before buying the accounts receivable, you learn valuable information regarding your customers, like which ones are likely to pay, and which ones are less likely to pay.A Trucking Factoring company is not the only method of gaining access to finance for the running and growing of your business, however it does offer a financing option well worth considering.