What is freight factoring? Is it hard to start factoring? Is it beneficial to factor? If you are curious about factoring, you’ve come to the right place. Read on for an in-depth explanation of freight factoring and its many benefits to owner-operators and trucking companies.
Many new owner-operators have misconceptions about what freight factoring is and how it can help them streamline their trucking business. In this guide, we explain freight factoring and provide more information about this essential service. We also touch upon those things to watch out for when considering signing up with a freight factoring company.
But first things first.
There are many potential rewards associated with working in the trucking industry like:
Opportunities in the trucking industry have been growing every year. If you are thinking about starting your own trucking company but haven’t done so yet, take a look at the steps outlined by the US Small Business Association. Every business has its rewards as well as its frustrations. One of the most common frustrations experienced by truckers, especially those who are owner-operators, is getting paid promptly. Many of the clients that you’ll find on reliable load boards have payment procedures in place. These procedures often result in unavoidable payment delays. Of course, this doesn’t change the fact that you still have bills to pay and other obligations to meet. Many owner-operators and trucking companies use freight bill factoring services to ease the burden of waiting for payments. In this way they create steady cash to keep their businesses running smoothly.
Many companies take anywhere from 30 to 60 days to pay their invoices. This can cause serious cash-flow problems for owner-operators who need money to pay for fuel and other expenses to keep on driving. Luckily, there’s a solution.
Companies like Pay4Freight that offer factoring services understand the unique needs of truckers and owner-operators.
Anyone working in the freight transportation industry as an individual independent contractor or as a company can take advantage of factoring programs. In addition to large companies with extensive fleets, freight factoring can help smaller companies with a single truck too.
Every person is different and each company is unique. There are many things to look out for when choosing a freight factoring company. We urge all people interested in factoring to do their homework. Most of all do not sign long-term contracts without reading the fine print. Read more about how we structure our contracts so they are honest and transparent and easy to understand. We’ve also put together a 5 point guide to help people evaluate factoring companies with some tips about what to look for and also the red flags to look out for. Freight factoring can make a big difference to a company but it’s so important to factor with a reputable company.
You get different kinds of factoring and it is important to understand the pro’s and cons of each type factoring. For more information, read more about recourse vs non-recourse factoring.
At Pay4Freight, we have helped many owner-operators and small t0 mid-sized trucking companies grow year-over-year. Many of our clients (who we refer like to as “partners” have stayed with us for years and years and that says something). If you are interested in working with a company with strong ethics, find out more about what drives us every day or give us a call at 888-479-4378 or send us an email.