Transportation Factoring and Freight Factoring
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Freight Industry Overview
The transportation and trucking industry have long been the backbone of the US economy. A vast majority of what consumers eat, wear, and use on a daily basis are delivered by trucks. With that comes the need for an extensive workforce spanning from drivers, dispatchers, engineers, and mechanics. This not only results in millions of employees in the trucking industry, but a trickle-down effect to job creation and small businesses that service trucking companies. This ranges from fuel stations, tire companies, mechanics, auto accessories, truck manufacturers, etc.
The transportation industry is made up of both independent owner-operators and large trucking companies. Owner-operators are entrepreneurs that own their vehicles and are contracted to both freight brokers and directly with corporations. Larger trucking companies own the vehicles and employ drivers to provide services on larger contracts they have with corporations. In both of these circumstances trucking businesses tend to work with large companies that require 15-90 terms to be given on their contracts. Because of this, many transportation companies turn to freight factoring to get paid faster on invoices. The best freight factoring program can ease the problem of distance in exporting goods. Please speak with an SMB transportations specialist today about our transportation factoring programs.
Factoring for transportation companies is the most common form of financing in the freight industry. This is mainly because trucking companies have two assets; trucks/equipment and accounts receivable/invoices. Equipment financing for the trucking industry is used to purchase vehicles, while freight factoring company is used for working capital.
Freight factoring company have daily and weekly expenses associated with day-to-day operations. Many bills have to be paid while waiting on invoices between fuel expenses, repairs, and payroll. Invoice terms range from 15-90 days and result in a big cash flow gap between incurred expenses and invoices that are paid. To bridge that gap, freight factoring is the best solution. By utilizing freight factoring, also known as transportation factoring, transportation companies can get paid within 24 hours of invoicing clients. By accelerating payments on invoices, transportation factoring companies can keep up with daily and weekly expenses. Factoring company for trucks is monetary third parties who will acquire your company’s receivables at a discount. They own the invoice once they have purchased it. This means that the transportation factoring companies will pursue the customer to pay the invoice.
Benefits of Transportation Factoring
Advance Rates up to 97%
Our transportation factoring programs provide up to a 97% advance rate on all invoices. With same-day and next-day funding options, you can receive 97% of your invoice in just 24 hours. Transportation companies no longer have to wait 15-90 days to be paid when using our best freight factoring companies programs.
For new applications, we can have your freight factoring line of credit set up in just 24 hours. Once the application is received and invoices are verified your trucking company can receive up to 97% of billed invoices within one day of being approved.
Limited Application Documents
No Setup Fees
No Minimum Volume Requirements
Same Day Funding
Fuel, Tire and Repair Discounts
Increased Working Capital
Improved Business and Personal Credit
Many business owners rely on personal and business credit cards and trade lines to operate their businesses. Freight factoring is off balance sheet financing, which means you can pay down all of your trade lines and remove debt from you as an individual and from your business. This will increase both personal and business credit and improve your credit profile moving forward.