New Factoring Program Leaves Your Company Rolling in Profits -
Our Accounts Receivable Factor
Your Truck Company
The Money You Want
Trucking Factoring is useful for a number of reasons. It allows a truck company to raise cash without getting brand-new financial obligation. While debt is in some cases required, most trucking firms would prefer to raise cash without borrowing money. Debt is dangerous, and when it can't be paid back, assets can be repossessed. If the financial obligation is big enough, it may even force a truck businesses out of business.
The Secret to Being Wealthy - Choose
An Invoice Factoring Company Instead Of A Regular Bank Funding
Exactly how to Enhance Money Flow Without Borrowing -Cash Money flow is one of the primary reasons companies fail.
At one time or another, every business, even effective ones, have actually experienced poor money flow.
Cash flow does not have to be a problem any more. Do not be deceived -- banks are not the only locations you can get funding. Other options are offered and you do not have to borrow. Exactly what is trucking factoring ? One option is called accounts receivable factor. Trucking Factoring is the process of offering accounts receivable to a financier rather than waiting to collect the money from the
client. Oh, the Irony- Trucking factoring has an ironic difference:
It is the financial
backbone of numerous of America's most effective companies. Why is this paradoxical ? Since receivable financing is not instructed in business colleges, is seldom discussed in company strategies and is relatively unidentified to bulk of most of American company individuals.
Yet it is a financial procedure that releases up billions of dollars every year, enabling countless companies to grow and prosper. Receivable Loan Funding has been around for thousands of years. Accounts Receivable Factoring Companies are investors who pay money for the right to get the future payments on your invoices. An overdue receivable or invoice has value. It is a debt your customer has actually agreed pay in the near future. Factoring Principals--Although factoring
offers solely with business-to-business deals, a big portion of the retail business utilizes a factoring principal. MasterCard, Visa, and American Express all utilize a form of factoring in their retail deals. Utilizing the purest definition of the word, these large customer finance companies are truly just large Commercial Factoring Businesses of consumer paper. Consider it: You make a purchase at Sears and charge
it to your MasterCard. The shop makes money practically immediately, even though you do not make payment until you are ready.
For this service, the credit card company charges Sears a charge (typical common normal fees vary from two to 4 percent of the sale). The Benefits Trucking Factoring can offer many advantages to cash-hungry business. Instead of waiting 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 little discount
off the dollar value of
the invoice. Payroll, advertising efforts, and working capital are simply a few of the business needs that can be satisfied with instant cash.
Accounts Receivable Factor provides the ways for a producer to replenish stock and make more items to offer: There is no longer a requirement to await for earlier sales to be paid. FACTORING is not just a cash management device for producers: Almost any type business can take advantage of Receivable Loan Financing. Typically, a business that extends credit
will have 10 to 20 percent
of its yearly sales bound in accounts receivable at any given time. Think for a moment about how much is bound in 60 days' worth of invoices: You can not pay the power expense or this week s payroll with a customer s invoice, however you can sell that invoice for the money to meet those obligations. Using truck factoring companies is a fast and easy process. The factoring company purchases the invoice at a price cut, typically a couple of portion
points less than the stated value of the invoice.
Please call our truck factoring specialists at 1 - 888-239-9162
or E-mail Us
The United states Trucking Association
mentions that there around
195,000 truck drivers with transportation
300,000 private providers trucking
firms licensed to
run in the U.S. that transferred,
according to their most current searchings for billions of
items, materials and
basic products .
There are several usual
groups on our country
roadways carrying these
vital items to our
stores, manufacturing facilities and ports.
several of them and offer their
accounts receivablesfinancing services
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
Cunningham 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, Cunningham 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.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. And worse yet, Cunningham 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, Lewis Greene, CEO of Cunningham 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 gone to his administrators and asked them what the problem had been. Were they doing something wrong or different when it came to reaching out to delinquent accounts? By his bookkeepers records, this wasn't 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. They couldn't afford to pay him their debt, but they could afford a lesser service, maybe. But after doing the cursory research for this and talking to friends in the field, he found that alas, no, customers of Cunningham hadn't gone elsewhere. They had just gone home.The situation looked dire to Lewis Greene. Lewis was very concerned, because there were constant overheads, goods to ship, employees to pay, and trucks which needed to be maintained, but there just wasn't the money coming back into the business. In the evenings he would discuss his concerns with his wife, Stacy, 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.Lewis 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 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,"" said Lewis. ""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 Stacy 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'.""Stacy was trying so hard to support her husband in these worrying times, while Lewis was weighed down with the worry of how he was going to handle this situation he found himself in.The next day Lewis strolled into his office and was determined to sit down and make every phone call to every client who had owed Cunningham money. This wasn't really a very efficient way for a Chief Executive to spend his day, and Lewis 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 Lewis was realising just how much trouble he was in.Poor Lewis 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 Lewis?"" she asked standing in the doorway.
""Sure thing Tracey, come on in."" Lewis leaned back in his chair and looked expectantly at Traceyerely.""Well, I did a little searching this afternoon and tried to figure out a way out of this mess Lewis."" She pulled a small stack of papers from a folder and set them on the desk before him.""Have you ever heard of factoring?"" she asked.""It does sound vaguely familiar. What is it?"" he said.""Well,"" she began, ""It�s actually quite simple really.
Basically, factoring invoices means that we would get paid immediately for the loads we haul.""""Immediately?"" Lewis interrupted.""Yes, immediately,"" she continued, ""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. 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 provides a very broad view.��Lewis 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.
This company tells us what the cost will be to purchase factoring for our accounts receivable. Once we arrive at a mutual agreement, the funding begins.�Lewis leaned forward and reviewed the paperwork closely.""I don't know, Tracey - it just sounds too good to be true"", Lewis 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. They appear to be very flexible, Lewis,"" she underlined a paragraph on the paper before him.""Just how flexible?"" asked Lewis.""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,"" Lewis said.He took a deep breath and looked at his secretary with something she recognized as hope.""Precisely�. This could very well be the answer to resolving the problems we're having with these clients who still owe us money.""Lewis took a moment to think about this solution, and agreed with his secretary. The clients who owed them money were long standing friends and professional resources of Cunningham. Just because they were experiencing difficulties paying their own bills now, Lewis was very concerned about losing these relationships. Lewis knew only too well that the whole economy was floundering, and that it was not going to change overnight. That unknown amount of time, if he handled these debtors incorrectly, could spell disaster for both of them. He didn't want to lose business but he also didn't want to lose any more money.""Let me go over this tonight Tracey, and thankyou."" Tracey nodded, satisfied with her work, and she left the office feeling quite content in the knowledge that she had helped Lewis keep the shirt on his back, and possibly hers too.Lewis sat behind his desk and looked over the details Tracey had not mentioned in their meeting. What other issues could freight factoring help Cunningham 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. In fact, Cunningham could receive up to fifty-percent cash advances upon load pick-ups. 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 Joe about this,"" muttered Lewis to himself.Joe is Lewis's son-in-law, and he really admired the ideas behind Cunningham, so much so that only two years before he had started his own transportation service business. Lewis knew then what struggles Joe would face but he encouraged him nonetheless. With the faltering economy, if a big fish like Cunningham was hurting, a little guy like Joe was about to catch his death. But, maybe the answer for both of them was in freight factoring, and Lewis was going to find out very soon.Some months later, having successfully gone through the entire process of the application, having experts study his credit history and statements and review his accounts receivable, Lewis found that he was starting his journey out of the despair which had been created for him by his delinquent account holders.They adopted reasonable factoring purchase contracts and stopped wasting their own precious time trying to collect debts. They used that time to refocus their efforts in being competitive in new territories. Lewis recalled those dismal months when he wasn't aware of freight factoring, and he shuddered at those memories. He probably wouldn't be in business today had he not learned just in time about freight factoring.
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Factoring in the Future of a Trucking Business: A Story Anthony Rodriguez 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. Rodriguez Trucking Company was at a turning point of growth and Anthony had to decide if signing with a factoring company was the right way forward.
More than forty years ago Anthony's father had started this business working as an owner-operator and eventually growing Rodriguez 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 Anthony'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. Now the company was solely in Anthony�s hands and he wanted to live to see it in better shape for his sons.
There just never seemed to be enough money to go around, and certainly no spare cash, but to move his company successfully into the future he needed a steady and reliable cash flow. His employees needed to be paid. They had families and household bills too. 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 Rodriguez 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'. Anthony allowed himself a good hard chuckle. 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). 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.
Anthony believed a successful man is always thinking of his next step. How would he take Rodriguez Trucking to the next level? More importantly, how could he afford it? Business funding was tied up in fuel bills and the mortgage for the garage and office. He just finished paying off the small bank loan for installing satellite radio in the trucks for the guys.
He wondered about factoring - was this the answer for him? If he was being honest, he didn't really understand how it all worked. It sounded like a ninth grade math problem and he wondered how this would fit into the trucking business. A factoring company actually purchases your invoices and takes control of your accounts receivable, payment being a certain percentage of the amount invoiced. 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. In those 30 days, a trucking company can�t pay its bills and employees in invoices.
Now it was time for Anthony to do his homework. 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! 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. Well, what was the point of going to a factoring company if there was shady business like that going on?
But it turned out to be quite easy. All the factoring companies he researched were open about their business practices and very friendly on the phone when he called. Customer service appeared to understand their company and explained in clear, concise English exactly how it all worked. He didn�t mind signing 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. In fact there were a few companies who offered him a non-recourse factoring program, and this was exactly what he had been hoping for. 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. 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. Factoring was based on the credit of his customers and on their reliability which worked well for Anthony 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 Rodriguez 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.
Anthony stepped out of his office to let his secretary know to expect the arrival of the factoring contract shortly. There was a new bounce is his step now: he knew instinctively that this new step would raise the future of his company to a new and higher level, and that all the stress from the past could now be put behind him. He suddenly realized that, with this new cash flow, he could actually expand Rodriguez Trucking Company and who knows, move into Canada, which had always been his dream. He was a happy man again knowing that he had just made a decision which would guarantee the success of his business and his sons wouldn't be inheriting a financial mess.
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Trucking Factoring Articles
�So It is not a loan?� asked Edwin Kelley, reclining back into his chair and crossing his legs. The woman sitting across the desk from Edwin smiled at him, shaking her head.�Not quite,� she stated.Edwin 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 Travis. He named his business Owens Trucking, named after Seth and Charles, his two grandfathers. They had both been hardworking men, and had done a lot to make Edwin the same.Six months ago disaster struck Travis's business when two out of his fleet of fifteen trucks were taken off the road.
One was a roll-over and ended up in the trucking graveyard: the other was involved in a serious and costly accident. The financial security of Travis's company relied on his full fleet on fifteen being on the road, and missing two trucks was just 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. This system works okay as long as no problems arise, but if they do, then things can get quite sticky.Edwin 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. Edwin knew she was employed by a Factoring company and that her name was Edna. Edwin 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'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.Edwin agreed. It sounded perfect - perhaps too good?.Edna laughed. �You look like you don�t believe me,� she chuckled.�No, I do, I just think it sounds a bit too good to be true. I thought I was going to lose my company.�Edna smiled, agreeing. �Yes, we get a lot of that. Listen, I�d hate to see you lose your company. 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.��No problem - I'm just down the road. We normally do it all online but I was happy to come and visit you today,� said Edna with a smile. �Let�s see what we can do to help you.�And with that they set about making a profile.
Edwin completed the form, with Edna offering advice as needed.
The profile filled Edna and her company in on Travis�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. As Edwin completed his form, Edna listened to his story and she felt quite sure he would be the ideal candidate for Factoring.When the form was done Edna took it and slid it into her briefcase. She then stood, reached across the desk and shook Travis�s hand. He stood before they shook as well, and then smiled. Edwin walked Edna 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 shut his eyes. He had felt so helpless lately, was sure the whole thing was collapsing, and would take him with it. Talking to Edna 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 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 there, he was on the right path, and he was working to make things right.Edwin 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 he had gotten bored. 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 Owens Trucking. So he did it. For the second time in his short life he created 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 about to turn fifty. He was concerned that he just didn't have the energy left to try and save the business. But he couldn�t give up. The idea of cutting his losses, shutting down, laying off his workers, it actually made him sick some nights. He didn't want to quit - both for himself and for his staff members.And now, because of factoring, he was sure he wouldn�t have to. Travis's eyes opened, he sat forward in his chair and turned on his computer. He had things to do. He could be thankful later, for now, it was time to work.
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The reason why Truck Agencies Use Factoring Companies.
As the owner of your own company, you may well be more than wary already of the hardship in making certain that cash flow concerns do not become a difficulty down the line. After all, the most disappointing thing that can possibly happen for your firm is to find yourself swept up in a long and challenging condition that leaves you forever looking for the resources you are in need of on an continuing basis.
For just about any establishment in this scenario, the challenge can come for waiting for work to lapse and actually be paid out into your account. Bill of sales, checks, and the like could take some time to actually to be taken care of which may leave you with temporary capital troubles. The good news is, there are alternatives out there for industries to check out-- and among these is factoring firms.
Factoring companies will, in substitution for your bill of sales, supply you with the resources right now to make sure that you don't have to worry about the delaying duration which could make paying off the expenses and obtaining toolsmore challenging. With this form of setup, invoice factoring can end up being extraordinarily practical for a lot of establishments who need to avoid a cash ploy which they have gotten themselves in.
Because, depending on the size of the work, it can take up to 60 days for some firms to get paid out then it's crucial to take care of your own back and definitely not leave yourself money short to settle the expenses. After all, how many firms possess two months profits just occupying there to cover all their overheads till they earn?
This is particularly true of truck companies. They tend to manage great deals of invoices which means a significant quantity of collection time entails business owner themselves. Striving to get compensated promptly can become an incredible inconvenience and this is why you work with truck factoring organizations who are delighted to help out truckers mainly.
As most of us realize, trucking is an surprisingly large industry with plenty of firms out there handling hundreds of vehicle drivers. Sadly, numerous of these drivers wind up in money issues considering that they are still waiting for work from six weeks in the past to actually compensate them. When this is the circumstance for a trucking organization, consulting factoring agencies for reinforcement could be the most effective option left.
This means that a trucking firm can pay the wages of the crew, keep all the vehicles filled with fuel and continue to go up, grow and expand without consistently waiting for the resources which is taking too prolonged to come in. Trucking Businesses functioning without a factoring program put in place are leaving themselves at significant hazard, as competitions cash out quickly and continue to develop.
There's genuinely not much to be distressed about when it comes to utilizing a Factoring business-- they usually are not like a banking company or an individual who is going to leave you with a huge heap of liability to pay back. You give them authentic invoices from work you have already accomplished , you are only just accelerating the repayment system.
In the United States, where trucking agencies succeed, factoring enterprises are not considered accepting loan of in any capacity. This confidential arrangement then lets both parties to profit and take joy in a convenient future-- it gives the factoring company a secured resource of money to put into the list and it supplies the trucking firm the needed money that they worked hard to gain.
The trucking business gives their invoices to the factoring agency. The trucking factoring firm then receive the installment payments from the trucking company's customers. Factoring has been in existence for centuries and has been utilized for many years by lots of various business sectors-- but none much more so than truckers. While you could lose out on a small part of the money, something like 1-3 % depending upon who you collaborate with, it indicates that you are acquiring the cash today and can actually start off putting the funds to work.
Anyway, an IOU or an invoice is definitely not going to cover costs, is it? For trucking establishments when the funds can be really good one day and gone the next, it's up to the drivers to work prudently and to ascertain they are leaving themselves with a considerable quantity of time and finance to get through the week up until they are compensated once again.
So the next moment your trucking company is bearing some temporary capital concerns and you are devoting too much time chasing slow paying customers, why not start looking into using a factoring businesses as a method to get your finances and give yourself a more convenient future in the eyes of your trucking team and your bank balance?
Traditional Bank Loans
Finance through a bank loan is the normal, or traditional, way of financing your business. 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. Plus, the amount you apply for through the bank is the actual amount that you are going to receive. 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. Trucking Factoring companies actually purchase your accounts receivable or at least part of them for a percentage of their total worth, Normally around 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
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. 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. There's 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 makes it easier for fledgling businesses to get the financing they need through a Trucking Factoring company (as long as their accounts receivables are in good order) then from a bank, who may not feel that you have been in business long enough to be worth the risk of issuing you a loan.
3. You'll receive the money faster. Using a Trucking Factoring company means that you'll get the finance quicker. 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. 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.Interest is Paid Up Front. With a bank loan interest continues to build, and this has to be paid the whole time you have a business loan; however with a Trucking Factoring company there is no interest - they take it right off the top by deducting it from the total amount of receivable accounts. 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.While a Trucking Factoring company is not the only way for your business to obtain the money it needs to keep growing, it does offer a type of financing well worth considering.