Receivables Mysteriously Disappear from the Books -
Our Factoring Company
Your Trucking Company
The Money Your Company Needs
Trucking Factoring is beneficial for a number of factors. It permits a truck firm to raise cash without obtaining new debt. While financial obligation is sometimes required, many truck companies would choose to raise cash without borrowing money. Financial obligation is risky, and when it can not be repaid, possessions can be repossessed. If the financial obligation is big enough, it might even force a freight brokerage out of business.
I gave away my receivables - and made more money too - Pick
A Freight�Invoice Factoring Company Instead Of A Traditional Bank Funding
Exactly how to Enhance Cash Flow Without Loaning -Cash Money flow is one of the main reasons businesses fail.
At one time or another, every business, even effective ones, have actually experienced bad money flow.
Cash flow does not have to be a problem any ever more. Do not be fooled -- banks are not the only places you can get funding. Other options are offered and you do not have to borrow. What is truck factoring ? One solution is called factoring company. Truck Factoring is the process of offering invoices to an investor instead of waiting to gather the cash from the
client. Oh, the Irony- Truck factoring has an ironic distinction:
It is the financial
backbone of many of America's most successful companies. Why is this ironic ? Because truck factoring is not taught in business colleges, is rarely mentioned in company strategies and is relatively unknown to the majority of most of American business individuals.
Yet it is a monetary procedure that frees billions of dollars every year, allowing countless companies to grow and succeed. Trucking Factoring has been around for thousands of years. Trucking Factoring Companies 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 financial obligation your client has actually to pay in the near future. Factoring Principals--Although factoring
offers solely with business-to-business transactions, a large percentage of the retail business utilizes a factoring principal. MasterCard, Visa, and American Express all use a form of factoring in their retail deals. Using the purest meaning of the word, these large consumer finance companies are really just large Accounts Receivable Factoring Businesses of consumer paper. Think about it: You make a purchase at Sears and charge
it to your MasterCard. The store makes money practically instantly, even though you do not pay until you are ready.
For this service, the credit card company charges Sears a charge (typical common normal charges vary from two to four percent of the sale). The Advantages Receivable Financing can provide numerous advantages to cash-hungry companies. Instead of waiting 30, 60, 90 days or longer for payment on an item that has currently been provided, a company can factor
(sell) its receivables for cash at a little discount
off the amount of
the invoice. Payroll, marketing efforts, and working capital are simply a few of the company needs that can be met with instant money.
Factoring Company provides the ways for a manufacturer to renew stock and make more products to sell: There is no longer a requirement to await for earlier sales to be paid. Receivable Loan Financing is not simply a cash management tool for producers: Practically any type company can benefit from Receivable Loan Financing. Typically, a company that extends credit
will have 10 to 20 percent
of its yearly sales bound in accounts receivable at any given time. Think for a minute about how much is bound in 60 days' worth of invoices: You can not pay the power expense or today s payroll with a customer s invoice, but you can offer that invoice for the cash to satisfy those obligations. Using truck factoring companies is a fast and simple procedure. The factor purchases the invoice at a discount, usually a couple of percentage
points less than the face value of the invoice.
Please call our freight bill factoring experts at 1 - 888-239-9162
or E-mail Us
The U.s. Transportation Organization
states that there are about
200,000 employees with freight trucking
300,000 personal service providers trucking
firms certified to
operate in the States that transferred,
according to their most current data of millions
items, materials and
fundamental products .
There are several common
teams on our nation
highways carrying these
important items to our
shops, factories and harbors.
several of them and offer their
receivables financing 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
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.
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.
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.
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.
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.
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
Andrews Truck and Haul has been in business since the mid 1980s. For more than twenty years they've been delivering goods for most major industries in the nation, with business booming as they traversed the country, in all kinds of weather, for all kinds of clients. During the heady times from 2002 to 2007, Andrews 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. The money was flowing, and times were great.But a short year later, in the fall of 2008, when the United States economy took a nosedive and businesses both small and large began to feel the pinch on their pocketbooks, those that used to make their demands had suddenly and largely gone silent. Business slowed down. Worse still, it was noticed by Andrews 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. And as spring turmed to summer and summer into the early days of fall, Herman Meyer, CEO of Andrews felt a chill go down his spine whenever he would look at the weekly A/R reports. The number of clients who were late in their payments was continuing to grow.He had gone to his administrators and asked them what the problem had been. 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 Andrews money had jumped ship and decided to leave him holding the bag.
. They couldn't afford to pay him their debt, but they could afford a lesser service, maybe. 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. They had just gone home.To Herman Meyer the situation looked desperate. He had employees to pay, goods to ship, trucks to maintain and overhead that was almost unbearable when compared against the lack of funds that were coming in. In the evenings he would discuss his concerns with his wife, Ida, and still find no relief from the worry and frustration.
""I have a bad feeling, Lin,"" he'd sadly say to his wife.""What could you do differently?"" she would say.Herman would stare off for a moment and then close eyes. He could see the fleet of trucks he had purchased over the 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. What could cause this ultimate death spiral of business?""I think I know what it could be,"" Herman 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."" All Ida could do was hold his hand and look at him tenderly. 'We know it's a difficult economy at the moment - perhaps it will take a while for people to get on top of their bills'.""Ida was trying so hard to support her husband in these worrying times, while Herman was weighed down with the worry of how he was going to handle this situation he found himself in.The following day Herman walked into his office with a spring in his step, determined to call each and every client who owed money to Andrews Truck & Haul. This wasn't really a very efficient way for a Chief Executive to spend his day, and Herman 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. A waste of time - a waste of money - he had the best intentions, but all the while Herman was realising just how much trouble he was in.Poor Herman 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.
""Herman, can I have a word?"" she queried, standing in the doorway.
""Of course Glenda, please come in."" Herman relaxed back into his chair and looked up at Glendaerley.""Well, I did a little searching this afternoon and tried to figure out a way out of this mess Herman."" 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 the word factoring?"" she asked.""It sounds 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?"" Herman 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.��I see,� Herman said. �And then what?��Well, after their review, and we�re approved for a factoring contract, we can negotiate terms and conditions. There�s a lot of flexibility depending on the business volume and credit histories. This company tells us what the cost will be to purchase factoring for our accounts receivable. The funding commences once we�ve arrived at an agreement.�Leaning forward, Herman studied the documents very closely.""It sounds too good to be true, Glenda,"" he said.""Yes, I know; that's exactly what I thought at the beginning. But think about it, Herman: 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 Herman,"" she underlined a paragraph on the paper before him.""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. 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. 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 Herman.Herman took in a long slow breath, then looked at his secretary with something like hope in his eyes.""Precisely�. I think this might just be a way out of the trouble we're in with these folks who owe us money.""Herman thought about this and agreed with Glendaerley. The clients who owed them money were long standing friends and professional resources of Andrews. Herman wasn't prepared to lose these relationships just because they were having financial issues at the moment. Herman 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. If he didn't handle these debtors in the right way, that unknown amount of time could spell disaster for all of them. Of course he didn't want to lose any more money, but he didn't want to lose business either.""Well, let me think about this tonight Glenda, thank you."" Glenda nodded, satisfied with her work, and she left the office feeling quite content in the knowledge that she had helped Herman keep the shirt on his back, and possibly hers too.Herman sat behind his desk and looked over the details Glenda had not mentioned in their meeting. He wondered if there might be other problems freight factoring could help Andrews Truck & Haul 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. Herman 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 Chad about this,"" muttered Herman to himself.His son-in-law Chad had liked the idea of Andrews so much and revered his father in law for having such business acumen that only two years before, he had gathered the venture capital to begin his own transportation service company. Herman knew then what struggles Chad would face but he encouraged him nonetheless. With the economy the way it was, if an established company such as Andrews was struggling then the little guys, like Chad, were going to be in even more trouble. But, maybe the answer for both of them was in freight factoring, and Herman was going to find out very soon.A few months later after going through the entire application process and having the experts review his accounts receivable, credit history and statements, Herman 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. Herman looked back on the dismal months of life before freight factoring and almost shuddered at the thought. If Herman hadn't discovered freight factoring at just the right time, his business may not be operating today.
More Trucking Factoring Companies Story Articles
Factoring in the Future of a Trucking Business: A Story Jerome Payne 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. Payne 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.
More than forty years ago Jerome's father had started this business working as an owner-operator and eventually growing Payne 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 Jerome'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. But now things were different: the company was in Jerome's hands and he needed to ensure that this business would be left in great shape for his sons.
To move Payne 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 all have families and the usual household bills. 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, Payne 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. Jerome allowed himself a good hard chuckle. His father had been against placing 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?� Also his father had the habit of teasing all the drivers he caught switching into automatic even though driving in automatic was much more efficient though not manly in his father�s eyes. 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.
Jerome believed a successful man is always thinking of his next step. How would he take Payne Trucking to the next level? 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. Thankfully he'd just finished paying off the bank loan for the installation of satellite radio in the trucks.
But was factoring the answer? There was a lot he didn�t understand about the process. 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. 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 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.
Now it was time for Jerome to do his homework. Jerome 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 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. He was not charged for a credit check, and in addition he was offered a fuel advance on the pick-up of a 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 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. Factoring was based on the credit of his customers and on their reliability which worked well for Jerome because he and his father had built up good strong relationships over decades with their list of clients. He knew immediately that there would not be any problems when they were contacted by the factoring company regarding their invoices. His clients wouldn�t think poorly of Payne 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.
Jerome 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 Payne 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?� asked Marcus Lee, reclining back into his chair and crossing his legs. The woman sitting across the desk from Marcus smiled at him, shaking her head.�No, not exactly,� she stated.Marcus was the owner of a small trucking company which had fallen on some hard times recently. Certainly the trucking business can be an extremely profitable venture, and for many years it had been that way for Glenn. He named his business Daniels Trucking, named after James and Clinton, his two grandfathers. Both of these men had been very hardworking and had set a great example for Glenn.Six months ago disaster struck Glenn's business when two out of his fleet of fifteen trucks were taken off the road.
One was involved in a very costly accident, and the other simply rolled over, and headed to the trucking graveyard. Marcus 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 Marcus 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. This system works okay as long as no problems arise, but if they do, then things can get quite sticky.Marcus 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.That�s where the woman across the desk came in. Her name was Vanessa and she worked for a factoring company. Marcus had come across her company as he sat in his office late one night, pouring over the internet for some solution to his problem long after his employees had gone home.She sat there now, and 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. That way we�re protected from a complete loss, but you�re protected from the outrageous fees you would find in a loan from the bank.Marcus nodded. It sounded good to him, almost too good.The woman laughed. �I'm not sure that you believe me,� she chuckled.�Oh no, I do: it just sounds too good to be true. I actually thought I might end up losing my business.�Vanessa nodded. �Yes, we get a lot of that. There's no way we want to see you lose your business. 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.��Well, I'm very grateful that you came to see me today.��No problem - I'm just down the road. We normally do it all online but I was happy to come and visit you today,� Vanessa said with a smile. �Let's work out a solution to your problem.�And right there and then they created a business profile. Marcus filled the form out, with Vanessa available to help him if he needed it. The completed profile gave Vanessa and her company all the information they needed on Glenn's business, and with this information they would determine if this business would in fact be suitable for Factoring. Unfortunately, not all companies are. Some were beyond factoring special brand of help, and sometimes things weren�t even dire enough for it. As Marcus completed his form, Vanessa listened to his story and she felt quite sure he would be the ideal candidate for Factoring.Vanessa took the completed form and placed it in her briefcase. She then stood, reached across the desk and shook Glenn�s hand. He stood before they shook as well, and then smiled. They said their goodbyes and Marcus 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 shut his eyes. He had felt so helpless lately, was sure the whole thing was collapsing, and would take him with it. But now, after speaking to Vanessa and learning all about Factoring, he felt such a huge relief, like someone had just lifted a huge weight off his shoulders. He relaxed into his chair, running his hand through his thick black hair with its telling streaks of grey.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 wasn�t out of the woods yet, there was still a lot of work to be done, but he could feel it. 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.Marcus 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 about it for a long time, then decided it was time to sell his restaurant. He took six months off, and during that time he decided to create Daniels Trucking. So he did it. 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 about to turn 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 want to quit - both for himself and for his staff members.And now it seemed as though he wouldn't have to - all because of Factoring. Glenn's eyes opened, he sat forward in his chair and turned on his computer. He had lots to do. He could be thankful later, for now, it was time to work.
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Why Truck Firms Utilize Factoring Companies.
As the manager of your own establishment, you may perhaps be much more than mindful already of the difficulty in making sure that cash flow concerns do not become a dilemma down the line. Anyway, the worst thing that can possibly occur for your firm is to find yourself embroiled in a long and problematic predicament that leaves you forever searching for the resources you require on an continuous manner.
For any firm in this instance, the dilemma can come for waiting for work to clear up and actually be compensated into your bank account. Invoices, 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 problems. Thankfully, there are options out there for companies to explore-- and one of these is factoring companies.
Factoring firms will, in exchange for your invoices, grant you with the money now to ensure you don't have to stress over the lingering time span which could make paying out the bills and obtaining toolsmore troublesome. With this style of setup, invoice factoring can become extremely valuable for many firms who ought to get out of a money trap which they have gotten themselves in.
Due to the fact that, depending on the scale of the project, it can take up to 60 days for some establishments to get compensated then it's important to blanket your own back and certainly not leave yourself money short to settle the costs. After all, how many establishments possess two months revenue just occupying there to deal with all their expenditures till they earn?
This is most especially true of truck companies. They often take care of good deals of accounts which means a huge quantity of collection time demands company owner themselves. Seeking to get paid in time can end up being an unbelievable difficulty and this is exactly why you employ truck factoring providers who are pleased to help out truckers primarily.
As we all realize, trucking is an extremely massive field with numerous organizations out there hiring hundreds of operators. Sadly, many of these drivers land up in finances dilemmas due to the fact that they are still anticipating work from six weeks back to actually pay them. When this is the case for a truck organization, choosing factoring companies for support might be the finest choice left.
This means that a truck corporation can compensate the salaries of the personnel, keep all the vehicles filled with fuel and continue to scale, grow and expand without continually waiting for the funds which is taking too long to come in. Trucking Enterprises working without a factoring program put in place are leaving themselves at notable threat, as rivals cash out promptly and proceed to develop.
There's absolutely not much to be worried about when it comes to utilizing a Factoring establishment-- they commonly are not like a financial institution or a person who is going to leave you with a considerable stockpile of personal debt to pay back. You give them authentic invoices from output you have already finalized , you are only speeding up the payment process.
In the Usa, where trucking firms flourish, factoring agencies are not considered getting a loan in any capacity. This private deal then makes it possible for both groups to benefit and experience a worry-free future-- it gives the factoring firm a secured asset of money to add to the list and it furnishes the trucking company the needed funds that they sweated to obtain.
The trucking company gives their accounts to the factoring agency. The trucking factoring agency then receive the installment payments from the trucking company's clients. Factoring has been in existence for hundreds of years and has been used for many years by many different industries-- but none exceeding so than truckers. While you could miss out on a small part of the money, something like 1-3 % depending upon who you team up with, it means that you are getting the finances today and can actually start off putting the cash to work.
Anyway, an IOU or an invoice is definitely not going to fund overheads, is it? For trucking enterprises when the money can be very good one day and gone the next, it's up to the vehicle drivers to work sensibly and to ensure they are leaving themselves with a substantial measure of time and finance to get through the week till they are handed over once more.
So the next instance your trucking company is having some temporary cash flow problems and you are shelling out a lot of time chasing inactive paying customers, why not begin thinking about utilizing a factoring companies as a way to get your cash and give yourself a more convenient future in the eyes of your trucking team 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. 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 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
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. 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 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. In addition, while the Trucking Factoring company does run a credit check on your customers whose accounts receivables are offered for financing, the state of your credit is not an issue. 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. Using a Trucking Factoring company means that you'll get the finance quicker. 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. 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 most important benefits is that once you sell your accounts receivable to the factory company, you don't have to take time away from running your business to collect the money owed from reluctant to pay customers. Since these accounts belong to the Trucking Factoring company, this is now their job. Trucking Factoring companies are very efficient at debt collecting, and this frees up your valuable time to devote to running your 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.