Truck factoring – is it right for you? You’ve been on the road for hours. You’ve just delivered your load when your customer said, once again, that they can’t pay you yet. You wanted to ask why but knew it wasn’t worth pressing. They never pay on time and probably never will. So, with your stomach grumbling and your feet too tired to move, you make the trek home and hope you get paid soon.
“There has got to be a better way to do this,” you think. That’s when you recall something called truck factoring. “Could that help me?” If you want to know more about truck factoring and how to find the right factoring company, read on.
You’ll get the cash you need within 24 hours.
Freight factoring (A.K.A truck factoring or invoice factoring) ensures your company has the proper capital to cover overhead costs, pay employees, and get the materials needed for your business. So how does it work? Let’s go back to the situation from above.
Instead of walking out empty-handed, you can sell the invoice to a factoring company. They will give you 80% of what the invoice is worth. You’ll have cash ready to use within 24 hours. Then, the factoring company will collect the payment from your client/customer and give you the remainder, minus a small fee.
“Okay,” you think. “This sounds great, but what should I look for in a factoring company?” We’re glad you asked. Below we’ll run through what a good factoring company looks like.
The factoring company will call customers about payment so you don’t have to.
What to Look For
There are several things to look for in a factoring company. Like:
Quick Payment: Great factoring companies should pay you within 24-48 hours. They should also understand that money is the lifeblood of your business. You can’t work without it. So if a factoring company you’re considering can’t pay you when you need it, move on. Don’t waste your time waiting.
Customer Management: No one likes waiting on payment. No one likes having to call about payment either. That’s why a great factoring company will do that for you. After all, they know you don’t have time to make calls. You need to focus on the business. So they’ll handle all the calls for you. Plus, they’ll help you “break up” with clients who aren’t worth it.
Suppose this a moment. You have a client that never pays on time. No matter when you deliver the load, they always have an excuse. You know they won’t change but can’t seem to break free. A great factoring company will take a look at your client list and see whose credit isn’t worth it. If they find a client with bad credit, they’ll tell you. That way, you’ll a have a solid reason to officially not work with the late paying client. The bonus is that with the right factoring company, you’ll never have to worry about late payments again.
Support: Everyone needs support now and then, and great factoring companies know it. So if you have an urgent question that needs answering, you should know who to call and when they’ll answer.
Business Loans: A reputable factoring company should offer more than just factoring. Imagine this a moment: you’re getting a lot of new business. The customers are flocking to you. There’s just one problem. You don’t enough have trucks to deliver the loads. So what can you do? Get a business loan from your factoring company. They’ll already know you so it’ll make the process that much easier. With the right factoring company you can grow your business can paycheck.
Contact First Capital for Truck Factoring Today!
Are you a growing company with bills to pay? Are you looking to expand your business but need a flowing stream of cash instead of a trickle?
Call us today at 888-825-1669 or contact us online. We will get the information we need from you, answer any questions you may have, and thoroughly explain the entire process. Hopefully, as you ease your mind, we will be able to help you take care of your slow cash flow situation and get you on your way.
How to Choose a Truck Factoring Company | First Capital Business Finance