How Can Factoring Help You?
When it comes to getting their freight bills paid in a timely manner, savvy trucking professionals always ask “How much will it cost me to factor?” Yet, there’s a flip side to that cost-of-doing-business question. The next question should be: “How much would it cost me if I did NOT have a factoring company?”
• Missed opportunity cost: Some customers may pay well, but they are just not willing to negotiate shorter payment terms -- yet you need to get paid in 30 days or less. When you choose factoring, you won’t miss lucrative opportunities because you’ll get paid up front, regardless of when the shipper pays.
• Missed discounts and savings: Factoring can also save on hiring extra staff or outside vendors to handle your invoicing, credit checks, collections, and even some of your bookkeeping duties.
• Increased risks: If you complete a job for a shipper or freight broker with a history of bad credit, slow payments, or non-payment, you could get stuck spending time and resources to try to collect what you are owed, or, worse, get stuck with a bill that could jeopardize your whole business. Factoring companies will protect you on the front end of a transaction with an in-depth credit analysis of your potential customers and on the back end with professional collections services to get you paid.
• Increased penalties and fees: When you don’t have the funds to cover your expenses, you can get hit with a variety of unnecessary costs, ranging from overdraft fees on your checking accounts and interest charges or late fees on your credit cards to penalties incurred if you miss deadlines for filing taxes. Factoring helps you avoid these costs by speeding up your cash flow. NASTC has chosen Orange Commercial Credit as their preferred factoring company and has been referring members to OCC for over 15 years. They are a trustworthy company that provides a great service and excellent rates to our members.
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