How To Rob Banks Legally -
Our Factoring Financing
Your Freight Company
The Cash You Need
Using a Truck Factoring Company is useful for numerous reasons. It enables a trucking company to raise cash without getting brand-new debt. While financial obligation is in some cases required, most freight brokerage would like to raise cash without borrowing money. Debt is dangerous, and when it can not be paid back, possessions can be repossessed. If the debt is huge enough, it might even require a truck businesses out of business.
The Most Expensive Mistake of Your Life - Select
A Freight Bill�Factoring Company Instead Of A Traditional Bank Funding
How to Enhance Money Flow Without Borrowing -Cash Money flow is among the primary reasons companies fail.
At one time or another, every business, even successful ones, have actually experienced poor money flow.
Money flow does not have to be an issue any more. Do not be fooled -- banks are not the only places you can get financing. Other options are offered and you do not have to borrow. What is truck factoring ? One option is called factoring financing. Trucking Factoring is the procedure of offering accounts receivable to an investor instead of waiting to gather the cash from the
customer. Oh, the Irony- Trucking factoring has a paradoxical difference:
It is the monetary
foundation of many of America's most effective companies. Why is this paradoxical ? Since accounts receivable factoring is not taught in business colleges, is rarely discussed in business plans 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, enabling countless companies to grow and prosper. FACTORING has been around for thousands of years. Receivable Loan Financing Companies are financiers who pay cash for the right to get the future payments on your invoices. An unpaid receivable or invoice has value. It is a financial obligation your customer has to pay in the near future. Factoring Principals--Although factoring
offers exclusively with business-to-business deals, a big percentage of the retail company uses a factoring principal. MasterCard, Visa, and American Express all utilize a form of factoring in their retail transactions. Using the purest meaning of the word, these large consumer finance companies are truly just big FACTORING Businesses of customer paper. Consider it: You purchase at Sears and charge
it to your MasterCard. The store makes money practically instantly, although you do not make payment up until you are ready.
For this service, the credit card business charges Sears a charge (typical common normal charges vary from 2 to 4 percent of the sale). The Advantages Commercial Factoring can offer many advantages to cash-hungry business. Rather than wait 30, 60, 90 days or longer for payment on an item that has already been provided, a business can factor
(sell) its receivables for money at a little discount
off the amount of
the invoice. Payroll, marketing efforts, and working capital are simply a few of the company requirements that can be met with instant money.
Factoring Financing provides the ways for a producer to replenish inventory and make more items to offer: 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 manufacturers: Almost any type business can benefit from FACTORING. Generally, a business that extends credit
will have 10 to 20 percent
of its yearly sales tied up in accounts receivable at any given time. Think for a moment about exactly how much is bound in 60 days' worth of invoices: You can not pay the power bill or this week s payroll with a customer s invoice, but you can offer that invoice for the money to satisfy those responsibilities. Using trucking factoring companies is a quick and easy procedure. The factoring company purchases the invoice at a price cut, usually a few percentage
points less than the stated value of the invoice.
Please call our freight factoring experts at 1 - 888-239-9162
or E-mail Us
The United states Transportation Association
states that there around
205,000 workers with freight trucking
300,000 personal companies trucking
firms accredited to
operate in the U.S. that transferred,
according to their newest data of millions
items, supplies and
basic products .
There are a number of common
groups on our nation
roadways transporting these
vital products to our
stores, manufacturingplants and shipping ports.
Plusfreight bill factoring
numerous 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
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.
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EveryTruckJob.com is a free service dedicated to helping professional truck drivers find new truck driving jobs with the best trucking companies hiring today!
Locate truck driving jobs by city, state, position andbenefits offered. Search current driving jobs and fill out the EZ truck driver application customized for cdl trucking jobs
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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.
Gomez 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, Gomez 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. Cash was flowing and times were good for all.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. And worse yet, Gomez 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. Spring changed to summer, summer changed to fall, and the CEO of Gomez, Chad Peterson, was beginning to feel very uncomfortable indeed whenever he looked at their weekly Accounts Receivable reports. There was a growing list of clients who now owed them back debt.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. 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 Gomez 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 Chad Peterson 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, Josephine, and still find no relief from the worry and frustration.
""I have a bad feeling, Lin,"" he would say with deep woe.""Well, what do you think it is?"" she would say.Chad 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. Why couldn�t he work out how to resolve this financial problem with his business?""I think I know what it could be,"" said Chad. ""For way too long I've been relying solely on profits received from invoices. For too long I've been allowing our clients to let their accounts become overdue."" 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.
""Chad 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 next day Chad strolled into his office and was determined to sit down and make every phone call to every client who had owed Gomez money. This wasn't really a very efficient way for a Chief Executive to spend his day, and Chad knew he should be overseeing all the other sides of the business, such as shipments and deliveries, approaching prospective customers, or working with his sales team. But, he felt like he was doing something proactive to help his business, even though he had staff on salary to do just that thing. Wasting money, wasting time - even with the best of intentions, Chad 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 Velmaerley knocked at his door.
""Chad, can I have a word?"" she queried, standing in the doorway.
""Of course Velma, please come in."" Chad relaxed back into his chair and looked up at Velmaerley.""Well Chad, this afternoon I did some research, trying to work out how we're going to get out of this mess."" She pulled a small stack of papers from a folder and set them on the desk before 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.""Chad interrupted ""Immediately?"".""Yes, immediately,"" she continued, ""It's actually very simple. We can have an expert account manager review our numbers and help us complete a company profile. That profile will also include investigating our accounts receivable aging reports, our existing customer credit limits and so on. Additionally, the factoring will help to determine the creditworthiness of our customers independent of their credit history with our business. It provides a very broad view.��I see,� Chad said. �And then what?��Following the completion of their review and once we've been approved for a contract with the factoring company, then we sit down to negotiate conditions and terms. You'll be surprised at the amount of flexibility, all dependent upon the credit histories and business volume.
The company will advise us the cost to purchase factoring for our company's accounts receivable. The funding commences once we�ve arrived at an agreement.�Chad leaned forward and reviewed the paperwork closely.""I don't know, Velma - it just sounds too good to be true"", Chad said quietly.""Yes, I know; that's exactly what I thought at the beginning. But think about it, Chad: 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 Chad,"" she drew a circle around a paragraph on the document before him.""How flexible?"" asked Chad.""They personalize the factoring rates so that the amount they are willing to take on is commensurate with our needs and our client�s debt. 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 Chad.Chad took in a long slow breath, then looked at his secretary with something like hope in his eyes.""Precisely�. This could very well be the answer to resolving the problems we're having with these clients who still owe us money.""Chad thought about this and agreed with Velmaerley. The clients who owed them money were long standing friends and professional resources of Gomez. Chad wasn't prepared to lose these relationships just because they were having financial issues at the moment. Chad knew that the economy had taken a hit and he knew that it would probably be a long time before things started to look up again. That unknown amount of time, if he handled these debtors incorrectly, could spell disaster for both of them. Of course he didn't want to lose any more money, but he didn't want to lose business either.""Let me go over this tonight Velma, and thankyou."" Velma nodded, stood up and left the office feeling that she had helped her employer keep on his shirt and hers too.Chad sat behind his desk and looked over the details Velma had not mentioned in their meeting. He wondered if there might be other problems freight factoring could help Gomez Truck & Haul 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. Chad 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 Jerry about this,"" muttered Chad to himself.His son-in-law Jerry had liked the idea of Gomez 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 Chad knew the struggles Jerry would face, but he still encouraged him to follow his dream. With the faltering economy, if a big fish like Gomez was hurting, a little guy like Jerry was about to catch his death. But, an antidote may have been found in freight factoring and Chad was soon to find out.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, Chad found that he was starting his journey out of the despair which had been created for him by his delinquent account holders.They took on reasonable factoring purchase contracts and stopped spending their precious man hours scrambling to collect debt. They took that time and refocused effort to offering competitive prices in new territories. Chad recalled those dismal months when he wasn't aware of freight factoring, and he shuddered at those memories. If Chad 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 The phone was ringing on his desk, and Marcus Rice just sat there letting it ring. 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. Rice Trucking Company was at a turning point of growth and Marcus had to decide if signing with a factoring company was the right way forward.
Marcus�s father had started as an owner-operator and had grown Rice Trucking Company into a fifteen trailer fleet over forty years. Yes, they had survived some very difficult times when it appeared like they might go under, and even Marcus'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. Now the company was solely in Marcus�s hands and he wanted to live to see it in better shape for his sons.
To move Rice 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 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 Rice 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. Marcus chuckled, thinking about his father. 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?� He smiled to himself as he remembered his father poking fun at the other drivers who switched to automatic, even though automatic was quite obviously more efficient (though less manly). His father days were long gone and technology was actually an important improvement for the business such as having Qualcomm to cut down on fruitless time communicating on the phone for bills of lading.
Marcus knew he was right in his forward thinking. How would he take Rice 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. He just finished paying off the small bank loan for installing satellite radio in the trucks for the guys.
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. The factoring company gives the trucking business its payment right away which allows the business to have continuous cash flow so it can pay employees, buy fuel, and make repairs for upcoming hauls. Without this assistance, you're placed in the position of waiting for payment from your customers, and this can often be thirty days, or more. During those thirty days the trucking company can't pay its employees and bills with invoices.
Marcus had to really consider what his next step was going to be. Marcus 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. Well, what was the point of going to a factoring company if there was shady business like that going on?
However, it all turned out to be very simple. 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. He liked the idea of a long term commitment so he knew he wouldn�t have to bother going back and forth to different companies and wasting time filing more forms. He was not charged for a credit check, and in addition he was offered a fuel advance on the pick-up of a 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. 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 more personable than those loan managers at the bank. 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 Marcus 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 Rice 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.
Marcus 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 Rice 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, this is not a loan?� asked Ted Lawrence, reclining back into his chair and crossing his legs. The woman sitting across the desk from Ted smiled at him, shaking her head.�Not quite,� she said.Ted Lawrence 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 Dale. His company was called Vasquez Trucking, named after both of his grandfathers, Mike and Cecil. Both of these men had been very hardworking and had set a great example for Dale.Disaster had struck half a year ago, when two trucks in Dale�s fifteen truck fleet went down. One was involved in a very costly accident, and the other simply rolled over, and headed to the trucking graveyard. Ted 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 Ted had on hand.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.Ted 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. Her name was Virginia 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.Ted agreed. It sounded perfect - perhaps too good?.Virginia laughed. �You look like you don�t believe me,� she said.�Oh no, I do: it just sounds too good to be true. I thought I was going to lose my company.�Virginia smiled, agreeing. �We get that a lot. 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 why we do what we do.��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,� Virginia said with a smile. �Let's work out a solution to your problem.�And with that they set about making a profile.
Ted filled the form out, with Virginia available to help him if he needed it. The profile filled Virginia and her company in on Dale�s company, and would help them determine if he was 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. Listening as Ted filled out his form, Virginia was pretty sure he was a perfect candidate for factoring.When the form was done Virginia took it and slid it into her briefcase. She then stood, reached across the desk and shook Dale�s hand. He also stood up, and they smiled at each other. They said their goodbyes and Ted walked her to the door, and then returned to 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 felt so drained: he had been flailing helplessly for so long, he just knew his business was going to collapse and probably take him with it. Talking to Virginia though, learning about factoring, it felt like a weight had been lifted from his shoulders. He sat back in his chair and ran a hand through his graying but still thick black hair.All those long, sleepless nights. The terrifying panic attacks that occurred regardless of where he was. Already he could feel all the stress start to drain 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.Ted 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 he had gotten bored. He wasn't passionate about the food industry. He thought about it for a long time, then decided it was time to sell his restaurant. He took half a year off, and in that time he thought to start Vasquez Trucking. So he did it. Once again he built 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 nearing fifty. He didn�t think he had it in him, to save this company. But giving up wasn't part of his personality either.
The idea of cutting his losses, shutting down, laying off his workers, it actually made him sick some nights. He didn�t know how to say quit.And now it seemed as though he wouldn't have to - all because of Factoring. Dale'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 Establishments Employ Factoring Companies.
As the operator of your own business, you may likely be more than mindful already of the difficulty in making sure that capital issues do not become a dilemma down the line. Anyway, the most terrible thing that can possibly happen for your enterprise is to find yourself swept up in a long and tough condition that leaves you forever looking for the money you necessitate on an continual manner.
For any enterprise in this condition, the concern can come for waiting for work to lapse and actually be settled into your bank account. Statements, checks, and the like could take a long time to actually to be taken care of which can certainly leave you with temporary cash flow troubles. The good news is, there are options out there for companies to consider-- and just one of these is factoring providers.
Factoring providers will, in trade for your statements, give you with the cash today to make sure that you don't need to stress over the waiting phase which could make paying the bills and acquiring materialsmore tough. With this sort of arrangement, invoice factoring can end up being incredibly helpful for numerous companies who need to get out of a cash lure which they have discovered themselves in.
Given that, basing on the scale of the project, it can take up to 60 days for several companies to get paid then it's critical to cover up your own back and definitely not leave yourself cash short to pay the monthly bills. After all, how many firms possess two months income just lying there to address all their overheads till they earn?
This is most notably true of trucking enterprises. They have the tendency to take care of great deals of accounts which means a serious volume of collection time demands company owner themselves. Trying to get paid off promptly can come to be an amazing struggle and this is exactly why you make use of trucking factoring firms who are pleased to help out truckers particularly.
As we all understand, trucking is an incredibly big industry with countless firms out there hiring hundreds of drivers. Sadly, quite a few of these drivers end up in finances troubles simply because they are still expecting work from six weeks in the past to actually compensate them. When this is the case for a trucking organization, choosing factoring firms for support maybe the most effective alternative left.
This implies that a trucking organization can pay off the salaries of the personnel, keep all the cars topped off with fuel and continue to escalate, progress and expand without consistently waiting for the cash which is taking too long to come in. Trucking Companies operating without a factoring system applied are leaving themselves at substantial danger, as contenders cash out promptly and carry on to broaden.
There's honestly almost nothing to be stressed about when it comes to employing a Factoring agency-- they aren't like a financial institution or a person who is going to leave you with a considerable mound of personal debt to pay back. You give them legitimate invoices from job you have already accomplished , you are only just facilitating the payment system.
In the United States, where trucking companies succeed, factoring establishments are not considered taking on loan in any capacity. This private deal then makes it possible for both groups to make money and experience a comfortable future-- it gives the factoring provider a guaranteed asset of income to include in the list and it offers the trucking firm the required money that they sweated to generate.
The trucking enterprise bestows their accounts to the factoring establishment. The trucking factoring firm then acquire the installment payments from the trucking company's customers. Factoring has been all around for centuries and has been utilized for many years by several varying fields-- but none exceeding so than truckers. While you might possibly miss out on a small part of the money, something like 1-3 % depending on who you work with, it indicates that you are acquiring the resources today and can actually start off setting the cash to do work.
Once and for all, an IOU or an invoice is not going to cover expenses, is it? For trucking establishments when the finances can be good one day and gone the next, it's up to the vehicle drivers to work smartly and to make sure that they are leaving themselves with a significant volume of time and money to get through the week until they are paid for once again.
So the next period your trucking business is enduring some momentary cash flow challenges and you are devoting way too much time chasing slowly paying customers, why not start looking at utilizing a factoring companies as a way to get your finances and give yourself a more pleasant future in the eyes of your trucking workers and your bank difference?
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. 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. 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 a Trucking Factoring account has been created for you, it will continue for as long as you need it, with the money available continuing to grow as your business grows, and providing cash as you require it.
Benefits of a Trucking Factoring Company Vs. A Bank Loan
While not every business can take advantage of Trucking Factoring account financing (you have to have a business that has account receivables) for those that can use this type of financing there are several distinct benefits.
1. You Won't Incur Debt. Since the Trucking Factoring company actually buys your accounts receivable you don't actually incur debt like you do with a bank loan. This has many benefits including the fact, that this type of financing won't affect either your business credit rating or your personal credit rating. 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. Receive Your 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. 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, there are several benefits that makes considering financing through a Trucking Factoring company over a traditional bank worthwhile. In addition, there are other benefits that a Trucking Factoring company can offer you, outside the scope of a bank. The main benefit is that once you've sold your accounts receivable to the Trucking Factoring company, you are free from having to collect money owed by your customers. 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.
In addition, since the Trucking Factoring company evaluates the credit quality of your customers prior to purchasing the accounts receivable you gain valuable information into which customers are likely to pay and which ones are not so 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.