How To Make a Good Profits -
Our Freight Bill Factoring Companies
Your Trucking Company
The Money You Need
Trucking Factoring is advantageous for a number of reasons. It enables a trucking business to raise cash without obtaining brand-new debt. While debt is in some cases essential, a lot of freight brokerage would choose to raise money without borrowing cash. Financial obligation is high-risk, and when it can't be repaid, possessions can be repossessed. If the financial obligation is large enough, it could even force a truck businesses out of business.
I liked this product so much - that I - Choose
An Invoice Factoring Company Instead Of A Traditional Bank Funding
Exactly how to Increase Money Flow Without Borrowing -Cash Money flow is among the primary reasons companies fail.
At one time or another, every company, even effective ones, have experienced bad cash flow.
Cash flow does not have to be an issue 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 money. Exactly what is trucking factoring ? One solution is called freight bill factoring companies. Truck Factoring is the process of offering accounts receivable to a financier instead of waiting to gather the cash from the
client. Oh, the Irony- Truck factoring has an ironic difference:
It is the financial
backbone of many of America's most successful businesses. Why is this ironic ? Because accounts receivable factoring is not taught in business colleges, is rarely mentioned in company plans and is relatively unknown to the majority of most of American business people.
Yet it is a monetary procedure that frees billions of dollars every year, allowing countless companies to grow and succeed. Commercial Factoring has been around for thousands of years. Receivable Financing Companies are financiers who pay money for the right to get the future payments on your invoices. An unpaid receivable or invoice has value. It is a debt your customer has actually agreed pay in the near future. Factoring Principals--Although factoring
deals solely with business-to-business transactions, a large percentage of the retail company uses a factoring principal. MasterCard, Visa, and American Express all utilize a type of factoring in their retail transactions. Utilizing the purest definition of the word, these large customer finance business are really just big Receivable Financing Businesses of consumer paper. Consider it: You purchase at Sears and charge
it to your MasterCard. The store gets paid practically instantly, even though you do not make payment until you are ready.
For this service, the charge card business charges Sears a fee (typical common normal charges vary from two to 4 percent of the sale). The Benefits Receivable Financing can offer many benefits to cash-hungry business. Rather than wait 30, 60, 90 days or longer for payment on an item that has actually already been delivered, a business 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 simply a few of the company requirements that can be met with instant cash.
Freight Bill Factoring Companies offers the ways for a producer to replenish inventory and make even more items to sell: There is no longer a requirement to await for earlier sales to be paid. FACTORING is not just a money management tool for manufacturers: Almost any type business can take advantage of Truck Factoring. Generally, a company that extends credit
will have 10 to 20 percent
of its annual sales tied up in invoices at any given time. Think for a minute about exactly how much is bound in 60 days' worth of invoices: You can not pay the power expense or today s payroll with a client s invoice, but you can offer that invoice for the money to satisfy those responsibilities. Using truck factoring companies is a fast and easy process. The factor purchases the invoice at a discount, usually a few percentage
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 around
200,000 truck drivers with transportation
276,000 private companies trucking
companies certified to
operate in America that transferred,
according to their latest data of millions
products, supplies and
standard products .
There are a number of usual
teams on our country
roads transferring these
crucial products to our
shops, manufacturingplants and harbors.
several of them and offer their
accounts receivablesfinancing 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.
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.
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.
Life of a Truck driver, like many other professionals can be very challenging, rewarding, and frustrating at the same time. �The Truckers Place.com� is an information site for many of the Truckers needs. It is designed to encompass the needs of the Trucker, both on the Road and at Home.
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Searching for the right trucking companies to move your freight can be tough, with the large amount of local, regional, and national truck carriers out there. FreightCenter helps make freight shipping simple, finding you the safest, reliable trucking companies every time you ship. Our trucking companies are licensed and insured to carry freight safely and efficiently across the country, no matter the size or type of freight you need to ship.Plus, with the high volume of freight we move, we will work to get you the best freight rates possible. Simply enter in a few details below and you�ll see instant freight rates from all the top trucking companies in one easy screen
Matthews Truck and Haul has been in 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, Matthews was a top rated accounts receivable mastermind of the trucking industry. Very few customers were behind on their bills, and those customers who were late turned in their overdue payments within an acceptable time frame. The money was flowing, and times were great.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 down. Worse still, it was noticed by Matthews in early 2008 that even though most of their loyal customers were on time with their payments, there were a few late bloomers who were starting to spread the disease. Spring changed to summer, summer changed to fall, and the CEO of Matthews, Alvin Wilson, was beginning to feel very uncomfortable indeed whenever he looked at their weekly Accounts Receivable reports. The number of clients who were late in their payments was continuing to grow.He had already been to the administrators to ask what the actual problem was. Were they doing things different, or wrong, when it came to collecting overdue accounts? When checking his bookkeeper's records this was definitely not the case. He thought perhaps that he was losing clients to a competitor who offered rock-bottom prices with little to no guarantee of quality performance, and that the folks who owed Matthews money had jumped ship and decided to leave him holding the bag.
. Perhaps they were unable to pay their debt to him, but were able to meet the costs of a lesser service. But after doing the cursory research for this and talking to friends in the field, he found that alas, no, customers of Matthews hadn't gone elsewhere. The had just gone!.To Alvin Wilson the situation looked desperate. 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. At night he would speak to his wife Erica and shake his head in frustration.
""I have a bad feeling, Lin,"" he'd sadly say to his wife.""What could you do differently?"" she would say.Alvin would stare off for a moment and then close eyes. In his mind he could clearly see the fleet of trucks purchased over the many years. He could see them on the road, delivering good to all his loyal customers. But somewhere, a haze would form over his fleet and the vast number of vehicles would disappear to but a few. What on earth was happening to create the death of his business?""I think I know what it could be,"" said Alvin. ""For way too long I've been relying solely on profits received from invoices. I've let too many of our customers go too long without paying on their bills."" Erica would look at her husband lovingly, and holding his hand would say 'It's such a harsh economy these days and our clients must be having difficulty meeting their responsibilities'.""Alvin knew his wife meant well, but he knew that he was responsible for too many people to sit idly by, waiting for the sun to peak over the clouds.The following day Alvin walked into his office with a spring in his step, determined to call each and every client who owed money to Matthews Truck & Haul. This wasn't really a very efficient way for a Chief Executive to spend his day, and Alvin 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. But, he felt like he was doing something proactive to help his business, even though he had staff on salary to do just that thing. Wasting money, wasting time - even with the best of intentions, Alvin knew that he was in trouble.
After a half day of contacting debtors in vain - they dodged his calls or promised to call back at worst or made minimal interest-only payments at best - he was about to throw in the towel when his secretary Charleneerley knocked at his door.
""Alvin, can I have a word?"" she queried, standing in the doorway.
""Of course Charlene, please come in."" Alvin relaxed back into his chair and looked up at Charleneerley.""Well Alvin, 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?"" Charleneerley asked.""It does sound vaguely familiar. What is factoring""? he asked.She began, ""Well, it's really very simple. So basically, factoring invoices would enable us to get paid on the nose for loads that we haul.""""Immediately?"" Alvin interrupted.""Yes, immediately,"" she continued, ""It's actually very simple. We start by having a professional account manager review our figures and help us set up a company profile. Included in the profile would be the investigation of our accounts receivable aging reports, our current customers' credit limits etc.. In addition, factoring will assist in determining our customers' creditworthiness, independent from their credit relationship with our company. It�s a broad view.��Alvin replied cautiously ""I see - and what happens then?��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. You'll be surprised at the amount of flexibility, all dependent upon the credit histories and business volume.
The company will advise us the cost to purchase factoring for our company's accounts receivable. We come to an agreement and the funding starts pouring out.�Leaning forward, Alvin studied the documents very closely.""I don't know, Charlene - it just sounds too good to be true"", Alvin said quietly.""Yes, I know; that's exactly what I thought at the beginning. But think about it, Alvin: they've guaranteed that experts will do all the paperwork, and that will free us up to do what we should be doing - focusing on our customers in good standing, and that kind of stuff. And they're flexible Alvin,"" she underlined a paragraph on the paper before him.""Just how flexible?"" he asked.""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. Apparently they can figure this all out in two to four days.
""""That sounds pretty good, seeing as we tapped ourselves out with bank loans last year to repair the fleet and money sure is tight. We need to keep business rolling as normal and every day we�re going unpaid, we�re closer to facing some serious problems in both the short and long term,"" said Alvin.He took a deep breath and looked at his secretary with something she recognized as hope.""Precisely�. This could be the answer to our prayers: it will solve many problems we're facing due to these unpaid debts.""Alvin thought about this and agreed with Charleneerley. The clients who owed them money were long standing friends and professional resources of Matthews. Just because they were experiencing difficulties paying their own bills now, Alvin was very concerned about losing these relationships. Alvin knew that the economy had taken a hit and he knew that it would probably be a long time before things started to look up again. That unknown amount of time, if he handled these debtors incorrectly, could spell disaster for both of them. Of course he didn't want to lose any more money, but he didn't want to lose business either.""Let me go over this tonight Charlene, and thankyou."" Charlene nodded, stood up and left the office feeling that she had helped her employer keep on his shirt and hers too.Alvin sat behind his desk and looked over the details Charlene had not mentioned in their meeting. What other issues could freight factoring help Matthews with? With his pencil gliding down the sheet he noticed that the factoring company could help fray the cost of fuel with fuel discount cards and fuel advances. Alvin 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 Bobby about this,"" muttered Alvin to himself.Alvin's son-in-law, Bobby, loved the idea behind Matthews and highly respected his father-in-law for having such great business sense, that two years ago he got his capital together and started his own transportation company. Alvin knew then what struggles Bobby would face but he encouraged him nonetheless. With the economy the way it was, if an established company such as Matthews was struggling then the little guys, like Bobby, were going to be in even more trouble.
Perhaps the antidote to these problems was in freight factoring, and they were about to find out.A few months later after going through the entire application process and having the experts review his accounts receivable, credit history and statements, Alvin found himself beginning to dig his way out of the hole his delinquent account holders 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. Alvin looked back on the dismal months of life before freight factoring and almost shuddered at the thought. He probably wouldn't be in business today had he not learned just in time about freight factoring.
More Trucking Factoring Companies Story Articles
The Future of a Trucking Company, and Factoring Leon Hudson let the phone ring on his desk. He let his morning coffee cool and left his cigarette to ash itself in the tray, because he is trying to make the biggest decision ever for his trucking company. Hudson Trucking Company had reached a turning point and he now had to make a decision as to whether he should sign up with a factoring company, and indeed if this would be a good or regrettable decision for his business.
Leon�s father had started as an owner-operator and had grown Hudson Trucking Company into a fifteen trailer fleet over forty years. Yes, they had survived some very difficult times when it appeared like they might go under, and even Leon's mother had jumped into the cab at times to make hauls. His father had lived long enough to witness the price of hires drop during the recession and watch the eruption of fuel prices afterwards. But now things were different: the company was in Leon's hands and he needed to ensure that this business would be left in great shape for his sons.
To move Hudson Trucking Company ahead into the future, he needed a steady cash flow but there was just not enough money to go around. His employees needed to be paid. They all have families and the usual household bills. A few of the refrigerated trailers really needed some maintenance, and in order to stay competitive he really wanted to invest in specialized haulers to meet the increasing requests for loads of agricultural and energy equipment. He knew that turning down these requests made Hudson Trucking look inefficient and weak in what was currently a strong market.
He knew what his father would have said - 'wait, take your time before adding new technology'. Leon chuckled, thinking about his father. He remembered when his father was totally against installing GPS units in the cabs. He would say, �Why do you need the voice of some woman to tell you to get off at an exit that has been the same exit that 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). His father days were long gone and technology was actually an important improvement for the business such as having Qualcomm to cut down on fruitless time communicating on the phone for bills of lading.
Leon believed a successful man is always thinking of his next step. What would be the next step for Hudson Trucking? And how would he be able to 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? If he was being honest, he didn't really understand how it all worked. It sounded a lot like ninth grade algebra which just didn�t feel like it belonged as part of the trucking business. Factoring companies buy your invoices and manage your accounts receivable for a certain percentage of the invoiced amount. The factoring company gives the trucking business its payment right away which allows the business to have continuous cash flow so it can pay employees, buy fuel, and make repairs for upcoming hauls. Without this assistance, you're placed in the position of waiting for payment from your customers, and this can often be thirty days, or more. During those thirty days the trucking company can't pay its employees and bills with invoices.
Leon had to really consider what his next step was going to be. He had heard of companies charging for same day money transfers, advancing a percentage of the money owed to your business, while the rest is held in a private account if the bill wasn't paid within sixty or more days. Worse still, if the customer defaulted on payment, the factoring company takes it out of the money supposedly coming to you! He'd even heard about some companies putting you onto a sliding percentage scale regardless of any previously signed contracts for possibly 3% or 7%, and there you are now with 10% coming as a charge to you out of the freight bill. His colleague, Ronnie, who owned a trucking company in Missouri, was nearly destroyed by a factoring company who charged him the full freight bill on top of the fees for factoring. 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. When he called the factoring companies he discovered they were very open about their business practices, and very friendly and helpful. 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. In fact, he was quite pleased with the idea of a long-term contract because he knew this was a one-off and he wouldn't have to keep going back and forth to different companies. 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. Also he was happy to hear how much he was offered in terms of percentages on the freight bills. It sounded like a great scheme to him.
It was really refreshing dealing with the factoring people. They were extremely helpful and more personable than the bank staff. It seemed as though those bank people spoke another language, but these factoring guys knew the trucking business and spoke to him like a client, not like a beggar for a handout. The factoring companies were not interested in his credit nor the financial problems his father had experienced in the past. All the factoring company was interest in was the credit of his customers and on their reliability: this worked great for Leon 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 have any problems, nor would they think poorly of Hudson Trucking, because the factoring companies handle themselves in such a polite and professional manner, similar to the way his father had managed the business in the past.
Leon 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. With the capabilities of this new cash flow, Leon could actually expand Hudson Trucking Company further across the country and perhaps even go international into Canada. 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 It is not a loan?� asked Jorge Grant, reclining back into his chair and crossing his legs. The woman sitting across the desk from Jorge smiled at him, shaking her head.�No, not exactly,� she stated.Jorge 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 Herbert. His company was called Banks Trucking, named after both of his grandfathers, Herbert and Gerald. They had both been hardworking men, and had done a lot to make Jorge the same.Disaster had struck half a year ago, when two trucks in Herbert�s fifteen truck fleet went down. One was involved in a very costly accident, and the other simply rolled over, and headed to the trucking graveyard. Jorge depended on his full fleet, and missing two trucks was devastating . Furthermore, buying a whole new truck and fixing the other simply took more cash than Jorge had on hand.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.Jorge wasn�t a bad owner, and he hadn�t messed up. Certain events had occurred that he couldn't possibly have predicted, and now he had to find a way to protect his business and prevent it from ultimate devastation.And that's why he found himself across the desk from this woman. Her name was Michelle 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.Michelle explained. �It�s not a loan, we purchase your accounts receivable. We aren�t giving you money to be paid back later, we�re buying something from you, and you can buy it back when you can. 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.Jorge nodded. It sounded perfect - perhaps too good?.Michelle laughed. �I'm not sure that you believe me,� she chuckled.�No, I do, I just think it sounds a bit too good to be true. I actually thought I might end up losing my business.�Michelle nodded. �We get that a lot. There's no way we want to see you lose your business. You work hard, you�ve put everything you can into it. We all need help sometimes. 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,� Michelle said with a smile. �Let�s see what we can do to help you.�And right there and then they created a business profile. Jorge completed the form, with Michelle offering advice as needed.
The profile filled Michelle and her company in on Herbert�s company, and would help them determine if he was suitable for factoring. In truth, not all companies were. Some businesses are beyond the help of a Factoring company, while other businesses weren't in enough financial stress to warrant it. Listening as Jorge filled out his form, Michelle was pretty sure he was a perfect candidate for factoring.Michelle took the completed form and placed it in her briefcase. Standing up, she reached over the desk and shook Herbert's hand. He stood before they shook as well, and then smiled. Jorge walked Michelle to the door where they said 'Goodbye', then he went back into his office.All his staff members were there, all seven who worked in his office. Sitting behind his desk once more he could hear the familiar sounds of his office workers going about their daily business.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. But now, after speaking to Michelle and learning all about Factoring, he felt such a huge relief, like someone had just lifted a huge weight off his shoulders. He sat back in his chair and ran a hand through his graying but still thick black hair.The long nights, where he couldn�t sleep. The sudden panic attacks, not matter 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 there, he was on the right path, and he was working to make things right.Jorge couldn�t help but think back to when he had first started the business. He had opened a restaurant at age twenty two when he was fresh out of school. 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 about it for a long time, then decided it was time to sell his restaurant. He took half a year off, and in that time he thought to start Banks Trucking. And that's exactly what he did. Once again he built a company from the ground up. He had been successful.Then disaster! The two trucks went down and suddenly his success wasn't looking so guaranteed. He was nearing fifty. He didn�t think he had it in him, to save this company. But giving up wasn't part of his personality either.
Just the thought of shutting down, cutting his losses, laying off his workers - the whole thing made him physically sick some nights. He didn�t know how to say quit.And now, because of factoring, he was sure he wouldn�t have to. Herbert's eyes opened, he sat forward in his chair and turned on his computer. He had lots 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
The key reasons why Trucking Companies Employ Factoring Companies.
As the owner of your own company, you may likely be more than mindful already of the challenge in making certain that capital concerns do not become a problem down the line. Anyway, the most awful thing that can in all probability develop for your establishment is to find yourself embroiled in a long and troublesome situation that leaves you forever searching for the finances you really need on an continuous manner.
For just about any establishment in this condition, the complication can come for waiting for work to clear up and actually be paid out into your bank account. Statements, checks, and the like can take a long time to actually to be taken care of which can easily leave you with short-term cash flow troubles. Thankfully, there are solutions out there for businesses to look into-- and one of these is factoring companies.
Factoring agencies will, in substitution for your statements, supply you with the funds immediately in order that you don't have to worry about the lingering phase which could make paying off the expenses and purchasing materialsmore troublesome. With this kind of setup, invoice factoring can become tremendously useful for lots of enterprises who have to get out of a cash trap which they have discovered themselves in.
For the reason that, depending upon the size of the task, it can take up to 60 days for a number of firms to get compensated then it's very important to take care of your own back and definitely not leave yourself resources short to pay the costs. After all, how many establishments possess two months cash flow just occupying there to cover all their overheads till they earn?
This is particularly true of trucking establishments. They tend to take care of numbers of accounts which means a considerable quantity of collection time involves business owner themselves. Attempting to get paid in time can become an amazing inconvenience and this is the reason why you utilize trucking factoring firms who are pleased to help out truckers specifically.
As all of us determine, trucking is an amazingly huge field with a lot of companies out there utilizing hundreds of drivers. However, several of these drivers end up in money difficulties given that they are still anticipating work from six weeks ago to actually pay them. When this is the scenario for a truck business, depending on factoring providers for solutions maybe the most suitable option left.
This indicates that a trucking business can provide the wages of the personnel, keep all the trucks refilled with gas and continue to surmount, develop and expand without constantly waiting for the resources which is taking too prolonged to come in. Trucking Business enterprises operating without a factoring system implemented are leaving themselves at considerable risk, as contenders cash out quickly and carry on to expand.
There's honestly almost nothing to be distressed about when it comes to using a Factoring firm-- they usually are not like a banking company or somebody who is going to leave you with a significant mound of financial obligation to pay back. You give them authentic invoices from work you have already accomplished , you are merely accelerating the repayment system.
In the United states of America, where truck enterprises develop, factoring enterprises are not considered borrowing in any capacity. This private arrangement then lets both parties to make money and delight in a worry-free future-- it provides the factoring provider a guaranteed resource of earnings to add to the list and it gives the trucking firm the needed finances that they worked hard to get.
The trucking enterprise bestows their accounts to the factoring enterprise. The trucking factoring agency then obtain the payment amounts from the trucking company's clients. Factoring has been in existence for centuries and has been utilized for many years by a lot of various industries-- but none more so than truckers. While you might lose out on a small part of the money, something like 1-3 % depending on who you deal with, it signifies that you are receiving the finances today and can actually begin putting the funds to perform.
After all, an IOU or an invoice is not actually going to pay for expenses, is it? For trucking enterprises when the funds can be great one day and gone the next, it's up to the drivers to work prudently and to guarantee they are leaving themselves with a notable measure of time and money to get through the week up until they are paid for again.
So the next instance your trucking establishment is enduring some short-term capital problems and you are devoting too much time chasing slowly paying customers, why not begin thinking of making use of a factoring companies as a manner to get your finances and give yourself a more at ease future in the eyes of your trucking team and your bank balance?
Traditional Bank Loans
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. As an example, a newly formed business may not have the required assets to qualify for a bank loan, and even if they did, it's usual practise for a bank to use the business itself as collateral. This means that if you default on your loan payment you could lose your entire business. Plus, the amount you apply for through the bank is the actual amount that you are going to receive. Once the loan is paid off, you can then apply for another loan if the need arises.
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. Rather the financing you receive from a Trucking Factoring company is based on money your business has already earned, but have 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 money you can receive is based on the amount of money you have earned and the accounts receivable you are willing to �sell.� Once a Trucking Factoring account has been created for you, it will continue for as long as you need it, with the money available continuing to grow as your business grows, and providing cash as you require it.
Benefits of a Trucking Factoring Company Vs. A Bank Loan
Not every business can benefit from Trucking Factoring account financing because you have to have a business with accounts receivable, however there are many benefits for those who can access this type of finance.
1. There is no debt. You don't incur debt as you do with a bank loan because the Trucking Factoring company actually purchases your accounts receivable. One of the main benefits of this kind of financing is that your business credit rating and your personal credit rating won't be affected. Should the unforeseeable happen and your business fails, you won't have to worry about anyone coming after your personal as well as your business assets to pay off a loan. The debt goes onto your credit report with a bank loan, with only one missed payment adversely affecting your business credit: it would also affect your ability to secure insurance, and may reflect on your personal credit rating as well.
2. No Collateral Required. Another benefit of using a Trucking Factoring company instead of a traditional loan is that you aren't required to provide collateral to the Trucking Factoring company in order to secure financing, because the company �buys� the accounts receivables; not loans you money based on them. 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. You'll receive the money faster. With a Trucking Factoring company you can actually get the money you need faster. Once the Trucking Factoring company assures itself that the customers in your accounts receivable are likely to pay their debt, the money is usually in the account within 24 hours. With a bank, there are vast amounts of paperwork, then the loan has to be underwritten, which can take months before you actually see the loan if it is 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. In addition, there are other benefits that a Trucking Factoring company can offer you, outside the scope of a 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.