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Medium-Size trucking companies, particularly those who have not been in existence for extremely long, will typically discover it difficult to secure a loan. Banks are typically reluctant to lend cash to companies that don't have a lot of income and assets. They also desire evidence of the viability of a company and thus need that the majority of operations, particularly little ones, be in business for a particular amount of time prior to they want to hand over any money. Due to the fact that of this, a small business frequently has few cash generating options when requires occur. One option offered, but frequently neglected, is factoring. This is an outstanding way for a small business to obtain cash.
For The Business Who Wants To Look Better - Pick
A Freight�Factoring Company Instead Of A Regular Bank Financing
Exactly how to Enhance Cash Flow Without Borrowing -Cash Money flow is among the primary reasons businesses fail.
At one time or another, every business, even effective ones, have actually experienced poor cash flow.
Money flow does not have to be a problem any more. Do not be deceived -- banks are not the only places you can get funding. Other solutions are offered and you do not have to borrow. What is truck factoring ? One option is called sell receivables. Trucking Factoring is the process of offering invoices to an investor rather than waiting to collect the money from the
client. Oh, the Irony- Trucking factoring has a paradoxical difference:
It is the financial
backbone of many of America's most successful companies. Why is this paradoxical ? Because truck factoring is not instructed in business colleges, is seldom discussed in business strategies and is fairly unknown to the majority of most of American company individuals.
Yet it is a financial procedure that frees billions of dollars every year, allowing countless businesses to grow and prosper. Receivable Funding has actually been around for thousands of years. Invoice Factoring Businesses are financiers who pay money for the right to receive the future payments on your invoices. An overdue receivable or invoice has value. It is a debt your client has agreed pay in the near future. Factoring Principals--Although factoring
deals solely with business-to-business deals, a large portion of the retail company utilizes a factoring principal. MasterCard, Visa, and American Express all use a type of factoring in their retail transactions. Utilizing the purest definition of the word, these large customer finance business are really simply big Receivable Financing Businesses of customer paper. Consider it: You purchase at Sears and charge
it to your MasterCard. The store makes money almost immediately, although you do not pay until you are ready.
For this service, the credit card business charges Sears a charge (typical common normal charges range from 2 to 4 percent of the sale). The Advantages Trucking Factoring can offer many advantages to cash-hungry companies. Instead of waiting 30, 60, 90 days or longer for payment on a product that has already been delivered, a company can factor
(sell) its receivables for money at a little discount
off the amount of
the invoice. Payroll, advertising efforts, and working capital are just a few of the company requirements that can be satisfied with instant money.
Sell Receivables provides the means for a producer to renew inventory and make even more products to offer: There is no longer a requirement to wait for earlier sales to be paid. Receivable Loan Financing is not just a money management tool for manufacturers: Practically any type company can take advantage of Receivable Loan Financing. Typically, a business that extends credit
will have 10 to 20 percent
of its annual sales bound in accounts receivable at any given time. Think for a minute about how much is bound in 60 days' worth of invoices: You can not pay the power bill or today s payroll with a client s invoice, however you can offer that invoice for the cash to satisfy those obligations. Using trucking factoring companies is a fast and easy procedure. The factor purchases the invoice at a discount, typically a few portion
points less than the face value of the invoice.
Please call our freight factoring specialists at 1 - 888-239-9162
or E-mail Us
The U.s. Transportation Association
specifies that there around
200,000 workers with freight trucking
300,000 private providers trucking
firms accredited to
operate in America that transported,
according to their most current data of millions
products, materials and
fundamental materials .
There are several usual
groups on our country
highways transporting these
important items to our
stores, factories and shipping ports.
numerous of them and offer their
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
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.
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.
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
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.
Nichols Truck & Haul have been operating their 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 boom times from 2002 to 2007 Nichols Truck & Haul was the mastermind of a top-rated accounts receivable in 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 Nichols 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, Jim Hunt, CEO of Nichols felt a chill go down his spine whenever he would look at the weekly A/R reports. The numbers of clients who owed him back debt were growing.He had already been to the administrators to ask what the actual problem was. Were they doing things different, or wrong, when it came to collecting overdue accounts? By his bookkeepers records, this wasn't 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 Nichols 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. The had just gone!.To Jim Hunt the situation looked desperate. Jim 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. After work he would confide in his wife, Suzanne, and neither were unable to stop the constant worry over the lack of funds.""I have a bad feeling, Lin,"" he would say with deep woe.""What could you do differently?"" she would ask.Jim 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 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 know what it is,"" said Jim. ""I've relied too long on the profits I receive from invoices alone. I've let too many of our customers go too long without paying on their bills."" Linda could only grab her husband's hand and look at him lovingly, ""It's a hard economy. It might be awhile until things get settled up.
""Jim 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 Jim walked into his office with a spring in his step, determined to call each and every client who owed money to Nichols Truck & Haul. Now, it wasn't the most efficient way to spend a day as a chief executive, what he really needed to be doing was to be overseeing all of the other intricacies of shipment and delivery and reaching out to prospective clients or retraining his sales team to do the same. 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, Jim 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 Eleanorerley knocked at his door.
""Jim, can I have a word?"" she asked standing in the doorway.
""Of course Eleanor, please come in."" Jim leaned back in his chair and looked expectantly at Eleanorerely.""Well, I did a little searching this afternoon and tried to figure out a way out of this mess Jim."" 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?"" Eleanorerley asked.""It does sound vaguely familiar. What is it?"" he said.She began, ""Well, it's really very simple. Basically, factoring invoices means that we would get paid immediately for the loads we haul.""Jim interrupted ""Immediately?"".""Immediately, yes"" she added, ""It's actually very simple. We can have an expert account manager review our numbers and help us complete 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.��Jim replied cautiously ""I see - and what happens then?��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. 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.�Jim was still a little concerned. He leaned forward in his chair and studied the paperwork very closely.""I don't know, Eleanor - it just sounds too good to be true"", Jim said quietly.""Now, now, I know, I thought the same thing. But really, they have guaranteed us experts that do all the legwork, which would free us up here to focus on our clients in good standing and marketing, all that good stuff. And they're flexible Jim,"" she drew a circle around a paragraph on the document 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. Apparently they can figure this all out in two to four days.
""""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 Jim.Jim took in a long slow breath, then looked at his secretary with something like hope in his eyes.""Exactly�. This could very well be the answer to resolving the problems we're having with these clients who still owe us money.""Jim 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 Nichols. Jim wasn't prepared to lose these relationships just because they were having financial issues at the moment. He was well aware that the economy was in a bad way and that it might be quite a while before things started picking up. That unknown amount of time could create a disaster situation for both of them if he wasn't careful in how these debtors were handled. 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 Eleanor, thank you."" Eleanor nodded, stood up and left the office feeling that she had helped her employer keep on his shirt and hers too.Jim stayed at his desk for a long time, looking over the details they hadn't discussed during their meeting. What other issues could freight factoring help Nichols 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. Jim was surprised: it said that his company could get up to fifty percent cash advances on load pickups. Jim was a typical business man: he despised binding contracts that didn't allow room to breathe, so he was pleasantly surprised to see that the factoring company didn't require a long term contract, that there was no minimum volume required, and that there were no sign-up fees.""Well, I'll have to tell Tyrone about this,"" muttered Jim to himself.His son-in-law Tyrone had liked the idea of Nichols 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. At that time Jim knew the struggles Tyrone would face, but he still encouraged him to follow his dream. With the economy the way it was, if an established company such as Nichols was struggling then the little guys, like Tyrone, were going to be in even more trouble.
But, maybe the answer for both of them was in freight factoring, and Jim was going to find out very soon.A few short months later, after completing the application process, having the legal experts review his credit history, accounts receivable, and statements, finally Jim was beginning to find his way out of the hole his debtors had created for him.They took on reasonable factoring purchase contracts and stopped spending their precious man hours scrambling to collect debt. They used that time to refocus their efforts in being competitive in new territories. Jim looked back on the dismal months of life before freight factoring and almost shuddered at the thought. If Jim hadn't discovered freight factoring at just the right time, his business may not be operating today.
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Factoring in the Future of a Trucking Business: A Story Adam Gray let the phone ring on his desk. His morning coffee cooled and his cigarette smoked away in the tray: Adam is thinking, and pondering the biggest decision he's ever had to make for his trucking business. Gray Trucking Company was at a turning point of growth and Adam had to decide if signing with a factoring company was the right way forward.
Adam�s father had started as an owner-operator and had grown Gray Trucking Company into a fifteen trailer fleet over forty years. There had been some hard times when it seemed everything was going to go under and even Adam�s mother strapped herself into a cab 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 Adam's hands and he needed to ensure that this business would be left in great 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. He had employees to pay. They had families and household bills too. Some of the refrigerated trailers were in need of repairs and he felt to stay competitive it was also a good idea to invest in specialized haulers to be ready for the constant requests he was getting for loads of new energy and agriculture equipment. He knew that turning down these requests made Gray Trucking look inefficient and weak in what was currently a strong market.
His father would have told him to wait and to take his time adding on new technology. Adam allowed himself a good hard chuckle. He remembered when his father was totally against installing GPS units in the cabs. His Dad would say ""Why on earth do you need some stranger telling you to get off the exit that everyone knows has been there for years?� 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. 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.
Adam knew he was right in his forward thinking. What would be the next step for Gray Trucking? More importantly, how could he afford it? Funding was all tied up in the mortgage for the office and garage and in the fuel bills. 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 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 the assistance of factoring, you have to wait for customers to send you the payment which is often 30 days late. In those 30 days, a trucking company can�t pay its bills and employees in invoices.
Adam 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! 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. 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. 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 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. 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. 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 more personable than those loan managers at the bank. 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 Adam because he and his father had built up good strong relationships over decades with their list of clients. 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 Gray 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.
Feeling happier now, Adam stepped out of his office to advise his secretary to expect to receive the contract very shortly from the factoring company. 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, Adam could actually expand Gray 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 Steve Allen, reclining back into his chair and crossing his legs. The woman sitting across the desk from Steve smiled at him, shaking her head.�No, not exactly,� she stated.Steve Allen owned a small trucking company, and his business had recently fallen on difficult times. Certainly the trucking business can be an extremely profitable venture, and for many years it had been that way for Terrance. His company was called Stanley Trucking, named after both of his grandfathers, Stephen and Roberto. Both of these men had been very hardworking and had set a great example for Terrance.Disaster had struck half a year ago, when two trucks in Terrance�s fifteen truck fleet went down. One was a roll-over and ended up in the trucking graveyard: the other was involved in a serious and costly accident. Steve depended on his full fleet, and missing two trucks was devastating . In addition, he just didn't have the available cash to buy a new truck, plus repair the other one.Paying of bills in the trucking industry is always a major cause for concern for businesses.
Waiting a month or longer for bills to be paid was quite normal. This system works okay as long as no problems arise, but if they do, then things can get quite sticky.Steve was an excellent business man, and he certainly hadn't done anything wrong. 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.That�s where the woman across the desk came in. Her name was Miriam 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.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. 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.Steve agreed. It sounded perfect - perhaps too good?.Miriam laughed. �I'm not sure that you believe me,� she said.�Oh no, I do: it just sounds too good to be true. I actually thought I might end up losing my business.�Miriam smiled, agreeing. �We get that a lot. 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.��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,� Miriam said with a smile. �Let's work out a solution to your problem.�And right there and then they created a business profile. Steve completed the form, with Miriam offering advice as needed.
The completed profile gave Miriam and her company all the information they needed on Terrance's business, and with this information they would determine if this business would in fact be 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 Steve completed his form, Miriam listened to his story and she felt quite sure he would be the ideal candidate for Factoring.When the form was done Miriam took it and slid it into her briefcase. Standing up, she reached over the desk and shook Terrance's hand. He also stood up, and they smiled at each other. They said their goodbyes and Steve 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. Talking to Miriam 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 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.His mind wandered back to the very beginning, when he first started his 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. His passion didn�t lie with the food industry. He thought long and hard, and then he decided to sell the restaurant. He took six months off, and during that time he decided to create Stanley Trucking. And that's exactly what he did. Once again he built a company from the ground up. The business had been an instant success.And then the trucks went down, and his success looked to be in flux. He was about to turn fifty. He didn�t think he had it in him, to save this company. 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 it seemed as though he wouldn't have to - all because of Factoring. Terrance'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.
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The key reasons why Truck Agencies Use Factoring Firms.
As the owner of your own company, you may perhaps be more than mindful already of the hardship in making sure that capital concerns do not become a difficulty down the line. Anyway, the most awful thing that can potentially transpire for your establishment is to find yourself embroiled in a long and hard predicament that leaves you forever looking for the finances you are in need of on an ongoing manner.
For any kind of firm in this predicament, the trouble can come for waiting for work to lapse and actually be paid out into your balance. Bill of sales, checks, and the like could take a while to actually to beprocessed which may leave you with short-term cash flow troubles. Luckily, there are approaches out there for businesses to examine-- and just one of these is factoring firms.
Factoring agencies will, in substitution for your accounts, give you with the money right away so you don't have to fret about the delaying time frame which could make paying off the expenses and obtaining materialsmore tough. With this style of arrangement, invoice factoring can come to be exceptionally practical for lots of establishments who ought to get out of a cash lure which they have discovered themselves in.
Considering that, depending upon the size of the project, it can take up to 60 days for many enterprises to get paid out then it's vital to take care of your own back and certainly not leave yourself money short to settle the expenses. After all, how many companies possess two months revenue just lying there to pay for all their overheads till they earn?
This is primarily true of trucking firms. They often manage great deals of statements which means a significant quantity of collection period concerns business owner themselves. Striving to get paid promptly can come to be an unbelievable headache and this is precisely why you employ trucking factoring providers who are thrilled to help out truckers exclusively.
As all of us know, trucking is an unbelievably massive field with many companies out there utilizing hundreds of operators. Sadly, several of these drivers land up in income issues for the reason that they are still waiting for work from six weeks ago to actually pay them. When this is the scenario for a trucking company, resorting to factoring firms for solutions may be the finest option left.
This means that a trucking company can pay out the wages of the workers, keep all the trucks refilled with gas and continue to surmount, thrive and expand without constantly waiting for the money which is taking too prolonged to come in. Trucking Firms functioning without a factoring program used are leaving themselves at considerable danger, as rivals cash out fast and continue to grow.
There's honestly nothing at all to be distressed about when it comes to using a Factoring establishment-- they usually are not like a banking company or somebody who is going to leave you with a big stockpile of financial obligation to pay back. You give them authentic invoices from job you have already wrapped up , you are merely speeding the repayment process.
In the Usa, where truck firms thrive, factoring providers are not considered accepting loan of in any capacity. This confidential contract then enables both parties to benefit and indulge in a good future-- it provides the factoring business a warranted asset of cash flow to add to the list and it furnishes the trucking business the required money that they worked hard to acquire.
The trucking firm gives their accounts to the factoring business. The trucking factoring firm then take the payment amounts from the trucking company's clients. Factoring has beenaround for hundreds of years and has been utilized for long times by lots of different business-- but none exceeding so than truckers. While you might possibly lose out on a small part of the money, something like 1-3 % depending on who you work with, it means that you are acquiring the cash today and can actually begin putting the resources to work.
After all, an IOU or an invoice is certainly not going to fund bills, is it? For trucking establishments when the cash can be excellent one day and gone the next, it's up to the drivers to work prudently and to ascertain they are leaving themselves with a notable volume of time and money to get through the week till they are handed over once again.
So the next occasion your trucking business is bearing some temporary capital troubles and you are spending a lot of time chasing slowly paying customers, why not start off looking into employing a factoring businesses as a way to get your cash 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. 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.
What Are Trucking Factoring Companies?
Trucking Factoring companies do not give loans, and the money you get from the Trucking Factoring company does not put you in debt. The finance you receive from the Trucking Factoring company is determined by money already earned by your business, but not yet received. The Trucking Factoring company purchases your accounts receivable, or part of them, for a certain percentage of their value - this is normally about 80-95%. The amount of finance you can receive will be based on the amount you have earned and the accounts receivable you are prepared to 'sell.' Once you have set up Trucking Factoring account it continues as long as you wish it too and the amount of money available to you even can grow as your business grows, giving you the ready cash you need to meet your own obligations.
What Are The Benefits Of A Trucking Factoring Company Versus A Traditional 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. You Won't Incur 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. There's no collateral required. Another great benefit of using the services of a Trucking Factoring company instead of a bank loan is that there is no collateral required for the Trucking Factoring company, because the Trucking Factoring company is 'buying' your accounts receivables. 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. You'll receive the money faster. With a Trucking Factoring company you can actually get the money you need faster. The money will normally be in your account within 24 hours, once the Trucking Factoring company is confident that your customers� accounts are likely to be paid. Borrowing from a bank begins with vast amounts of paperwork, the loan must be underwritten, and this can take ages before you're notified if the loan has been approved.
4.You receive interest up-front. 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 not only are you relieved of those monthly loan payments, but you also don't have to worry about the building up of interest, as every penny in the account is yours to spend on the business.
As you can see, there are several benefits that makes considering financing through a Trucking Factoring company over a traditional bank worthwhile. However, there are also a couple of other benefits that a factory company can offer your business is far beyond the scope of the bank. The 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.