Freight Broker Factoring
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Factoring for Freight Brokers
As a freight broker it’s a constant balancing act of managing receivables from shippers and payables to transportation companies. A freight brokers responsibility to is arrange transportation companies to ship good for its clients in exchange for a fee. Freight brokers frequently deal with slow paying shippers which causes a cashflow problem when it’s time to pay carriers. Not only is this common, but it can also have a big impact on a freight brokers ability to find carriers for its shippers. If carriers aren’t paid within terms, they often turn to other freight brokers or try to work directly with shippers to avoid slow or potentially nonpayment. In order to avoid this situation many companies turn to freight broker factoring programs.
Benefits of Freight Broker Factoring
Advance Rates up to 97%
Factoring for freight brokers helps companies accelerate payment on invoices and avoid being caught in potential cashflow gaps. By utilizing different factoring programs freight brokers are able to focus on adding new shippers and carriers to their company. In addition to having money available for growth opportunities, freight broker factoring programs provide ongoing working capital for day to day operations. Getting paid up to 97% of every invoice within 24 hours of billing provides a cash cushion that’s normally not there. Some additional benefits to using freight broker factoring are.
No long term contracts
Improved operating cashflow
Quick pay solutions for carriers
Off-balance sheet financing
Accelerating cashflow by collecting invoice payments on day 1
Growth capital to secure new contracts
Simple application process
No upfront fees
Advance rates up to 97%
No minimum volume requirements
Quick Pay for Freight Brokers
Another option for freight brokers is to partner with a freight factoring company to provide quick pay options for carriers. In addition to using freight broker factoring many companies look to offer solutions to their carriers to get paid faster. In this arrangement freight brokers partner with freight factors to provide additional benefits to their carriers. Offering quick pay options and fuel cards to carriers can help keep loyal carriers from working with other companies.
Choosing the Freight Broker Factoring Company
Deciding which freight broker factoring company to choose is essential for the ongoing operations of your company. Money is a commodity and is widely available, but that doesn’t mean it’s the right money for your business. Freight brokers are a specialty business that requires a specialty lender. Relationships between carriers and shippers are the most important part of the business and making sure you have the right lender partner is crucial. Choose a freight broker factoring company that will take the time to learn about your company, your carriers, and your shippers. Speak with a freight broker specialist today to learn about the factoring programs we offer.
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