Trucking factoring is a way for trucking businesses to manage some of the financial stresses of waiting to be paid without waiting to pay employees. This method of insuring payment to employees and getting the funds needed to carry out other day to day business is becoming more and more popular among trucking companies. Utilizing trucking factoring companies is not quite like taking out a loan, either. Since it involves the sale of invoices to a factoring company, there generally isn’t a credit check or qualifying check like there may be with a bank loan. Overall, it is simply a way for a company who has a late-paying client to make sure the employees are paid and that business runs as normal.
There are times when a trucking business may face the harsh reality of a client who waits to pay for their shipment. Hopefully most trucking companies have clients that reliably pay on time, but sometimes there may be an issue where the client is late with the payment. This can be stressful when there is maintenance to be done and employees to be paid for the work they have completed. When something like this occurs, a trucking factoring company can step in to help.
Unlike applying for a loan, utilizing a factoring company involves the selling of invoices. When the factoring company purchases the invoices, they pay the trucking company so that the employees can get their paychecks on time. Then the factoring company waits to be paid by the client who is late. Once the client has paid in full, the factoring company generally hands over any reserves back to the trucking company, with a small percentage left as payment for services.
The nice thing about using a factoring company is that it can take much of the stress of waiting for payment off of a company owner’s mind. Instead of having to wait for the client to make the payment, the factoring company does the waiting for the trucking company. Instead of employees waiting to be paid, they receive their money right away. In addition, the trucking company does not have to go through the process of applying and waiting for approval of a bank loan.
Trucking factoring is a rather simple way to make sure a trucking company is able to pay employees and continue to function day to day when a client is late with payment. Rather than having to wait to pay employees due to a late client, a factoring company can give a trucking company the money right away and do the waiting on that company’s behalf. It can be a simple way to reduce the stress brought on by late paying clients.
Non-recourse freight factoring is a great risk-free funding method to ensure that you get paid for the whole load hauled whether your customers pay or not. So if you want to keep your trucks in good shape and continue to run your loads uninterrupted and you lack the necessary cash flow, non-recourse factoring is your ideal solution.
Unlike other forms of factoring where you are responsible for the goods not paid for,a non-recourse factor will assume the whole risk of your invoices and so you will keep the whole amount advanced.
How non-recourse freight factoring works:
When you start a non-recourse factoring relationship with a factor, the factor agrees to purchase your goods for a flat fee. He then advances you the value of the goods minus that fee. So if the factoring rate is 5% you will be advanced the value of your goods less 5%. The money becomes yours and the factor waits for your customers to pay for the goods.
This is a great way to boost your credit in order to finance new goods without adding debt to your books. The immediate cash received can be used to pay all your bills and qualify you for cash discounts.
Advantages of non-recourse factoring
The non-recourse factoring company assumes the whole risk of default by your customers saving you the hassle of having to follow up on your invoices.
The factoring company charges you a flat fee. Therefore you always know the factoring fee and the amount you expect to receive before you sell an invoice.
Peace of mind
You do not need to worry whether your haul will be paid for. Once you receive your money from the factor you move on to the next business.
Quick access to cash
The speed at which factoring companies provide you with the cash is much faster compared to having to try to apply for a loan from a bank to cover your invoices.
Freight factoring is an implies that is of awesome help to the truckers. It helps them in getting paid quickly for the work they have done. A factoring organization buys receipt at markdown rates from trucking organizations and pays them to trade out the return. These factoring organizations then gather the sum from the customers. Numerous trucking organizations depend on cargo factoring since it helps them a great deal particularly amid those extreme times when they require money the most. It is troublesome for a trucking organization to hold up until 30 to 45 days for accepting installments from customers.
By offering your receipts to these factoring organizations your income stresses are diminished. These organizations help you in getting the money your requirement for taking care of the budgetary requests. The greatest advantage is that you can money with no additional obligations or without going for advances. The factoring depends on the financial soundness of the clients.
It is superior to a bank advance in light of the fact that on the off chance that you take credits for such costs then you would discover trouble in getting advances when you really need them. In addition, these factoring organizations handle a large portion of the obligations which generally would be exceptionally troublesome for us to handle. They’ll do charging and gathering both for you.
A good company will handle everything related to factoring and will help you in getting immediate cash. With some of the companies, you can even check your accounts online. Look for the one that offers the high amount of advances for your factoring industry.
With factoring, you don’t have to worry about when payments are going to come in, and you don’t have to spend all your time hassling clients to pay. You are completely free to focus your time and company resources on more profitable things than accounts receivable activities. Once your cash flow has improved, you can stop sending in your invoices.
Trucking companies and freight brokerages play a vital role in our country’s economy, but because of the nature of the business, many transportation companies struggle. There is a way out, however. Let invoice factoring services solve your cash flow problems today.
If you’re in the business of managing delivery work, you have to know how to protect not just yourself, but also the cargo that you’re carrying.
Here are some practical tips to help you keep things on the safe side and make safe truck deliveries.
It is not only first-class business ethics to keep the confidence of your customers, but doing so also helps avoid people from targeting your deliveries for unsavory purposes. Keep mum about all the clients as well as deliveries you make, whether you’re hauling a load of junk or a load of valuable electronics, and it will be much harder for crooks to single you out for theft.
Sharing Locations Shall Be Avoided
Smartphones as well as tablets are a boon for delivery work, with the beginning of apps that help with navigation as well as keep track of traffic. Just make certain that the apps installed on your gadgets don’t share the location of the vehicles on any social networks. You actually don’t want to be advertising where your trucks are all over the Internet.
Let co-workers be familiar with where you are at all times. While it’s not wise to share your location with total strangers, it’s very important to do so with co-workers. Monitoring the location of a driver by the use of GPS or radio check-ins will help the team react quicker if something does go wrong.
Invest in hard locks, tough windows as well as tough alarms. Dedicated thieves will forever find a way, but it pays to create their lives a bit more complicated. Reinforced windows as well as heavy-duty locks will make it hard for thieves to just smash their technique to the loot, while elaborate alarm systems will alert close by people to a theft in progress.
Park Overnight In Designated Truck Stops
Long distance transportation jobs will frequently entail stopovers for the night. Make certain you or anyone else managing the delivery work stops over only in secure truck stops where other drivers also spend the night. Security in numbers applies here, and there will be ample of other people to lend a hand should anybody try to take advantage.
Carry Only As Much Cash As Needed
It is usually a bad idea for drivers carry too much extra cash while on a job. Petty thieves as well as crooks will pay more attention when they see a fat mass of bills in your wallet. If you require to transport a lot of cash, consider writing cheques or carry a non-descript cash box instead.
Drive defensively as well as to avoid road rage. A calm state of mind can aid drivers focus more on the road as well as less on distractions that could lead to disaster. Driving calmly also helps avoid possible altercations on the road, which can lead to road rage – an remarkably bad idea when delivering heavy as well as valuable loads.
Keep always these tips in mind, and they’ll aid keep you safer while handling delivery work.
Good mental stamina is surely necessary. Truck drivers, particularly long haul drivers must deal with dissimilar situations daily. They will be driving in unlike weather conditions, various traffic conditions as well as different dock situations. Drivers may have special assignments daily and special schedules. This makes it difficult for a lot of drivers to get sufficient rest and oftentimes, they continue to drive when they are stressed out as well as exhausted. Drivers who lack fine mental stamina may not do well in the trucking industry.
Route planning is an incredibly important skill to have. You will need to know how to plan the most well-organized route for your trip. Therefore, you will need to have a good map reading skills or invest in a good quality GPS unit. If you fail to take the time to plan, first-class routes for your trips you will lose priceless time, possibly get lost and surely become very frustrated.