Each industry has its own unique set of concerns and problem areas, and the transportation and freight sector is no different. Rising fuel costs, the high costs of trucks and related equipment, a sizable payroll and long hours are mainstay in the industry. During these hard times, many in the transport and freight are making financial adjustments to keep their companies on the road and moving.
Freight factoring and transportation factoring are options more and more companies are using today to secure money they need to pay their bills and cover expenses now. As a trucking company owner, you may have to wait 90-days for a shipping payment to come in, but that doesn’t mean your bills can wait that long. This is where a freight factoring company comes in.
When Now Counts, Consider Freight Factoring
A freight broker factoring company will buy your credit worthy invoices for an average of 96% of their total value giving you the hard cash you need right away – usually within 24 hours – to cover your expenses. Unlike bank loans freight and transportation factoring companies look at the creditworthiness of your customers rather than your credit score. So if your clients generally pay their bills on time, the freight factoring company will make its assessment and proceed with the transaction. Fortunately, they make this decision in a day whereas banks that can take several weeks. Getting cash fast is one of the main reasons businesses choose a freight factoring company.
Transportation Factoring: A Trustworthy, Reliable Way to Get Cash Fast
Though accounts receivables factoring or invoice factoring may sound new to many business owners, it is actually a common practice and has been around for hundreds of years. A number of industries such as agriculture and farming, oil and gas, manufacturing and others that require large, expensive equipment purchases find accounts receivables financing to be a good fit for their business model. Transportation factoring fits neatly into this category. Unlike a bank or a payday loan, you don’t owe money with Invoice Factoring. So if you prefer to stay ahead of your bills and remain in control of your finances, take a close look at what freight factoring offers.
Read the Factoring Brokers Contract, and Then Read It Again
Each freight and transportation funding company works a little different so make sure you research the company and understand the details of the transaction ahead of time. Any freight broker factoring company that won’t tell you in advance the percentage or fee it takes in an easy-to-understand contract should be a red flag. Freight bill factoring can be a great way to get the money you need to keep your business in the fast lane despite a difficult economy.