The Numerous Benefits Of Transportation Factoring

According to the American Trucking Association, freight volumes will experience a twenty-nine percent increase over the next eleven years. In theory, more work provides trucking entities with a decent opportunity to grow and prosper and makes trucking look like a rather lucrative business. There is, however, one underlying reservation business owners or prospective owners must heed — and that is the challenge of cash flow. It’s virtually impossible to run an enterprise without a steady income, and unfortunately many customers, particularly larger distributors, can take anywhere from one to three months to pay on their invoices. Because trucking companies never know precisely when they’re going to get paid, they lack the security to expand.

Possible solutions include taking out a loan, but many banks and other financial institutions make doing so incredibly challenging for smaller companies that haven’t been in existence long enough to meet the criteria for a bank loan. Until recently, they’ve been left with very few options. Fortunately, transportation factoring has become a regular practice in the trucking industry, awarding companies with cash advances on their invoices and alleviating the need for them to hunt down and hassle their customers. It provides them the breathing room to pursue other revenue-building initiatives.

One reliable freight factoring company provides financing to trucking companies that wouldn’t be available through alternative means – with 48-hour approval and same day factoring on invoices. They offer several plans, the first being flat factoring. With this option, the factor takes over the invoice for 90 days, with a nominal one-time fee, starting from 1.59%. Then they’ll provide the client with a 97% cash advance up front, while the remaining 3% is held in reserve and then awarded back to the client once the customer has paid their debt back in full. Visit Accutrac Capital to learn more about the plans and services on offer.

Flex factoring is another great option for those that have dependable customers but require payment immediately, whether to handle overhead costs such as wages and fuel, or to seize a new growth opportunity. Flex factoring is fantastic for clients with quick-paying customers and rates start at 0.49% for up to ten days. If a larger size enterprise is managing an entire fleet, choosing a factoring line of credit starting at 0.022% per day ends up being the most cost-effective option. Qualification is easy, as this factor boasts a 99.9% approval rate to customers seeking approval for funding. Plans also come with a variety of built-in services from fuel cards to equipment financing, as well as AR management in the form of free credit checks for a client’s current and prospective customers.

If you’re a trucking business frustrated by how long it takes your customers to pay for services rendered, enjoy peace of mind by ensuring you receive the bulk of your payment immediately. Partner with a transportation factoring company, and watch your business grow. Feel secure enough to take on new jobs coming available as well as contracts with larger corporations that pay more, irrespective of how long they take to pay on their invoices. Worry less about working hand to mouth and feel like you’re in control of your ventures again with the freedom and versatilely of transportation factoring.

Adam Hansen

Adam is a part time journalist, entrepreneur, investor and father.