For transportation and logistics businesses, optimally managing cash flow is very important for keeping trucks on the road. A lot of freight companies struggle with long payment cycles. Oftentimes, they have to wait 30, 60, or even 90 days to get paid by shippers or brokers. Through freight factoring businesses are able to get paid for invoices immediately which solves a lot of waiting issues. At Simply Factoring Brokers, we assist trucking companies and freight carriers in discovering the best factoring options that ensure their business operations remain financially healthy and expandable.

What Is Freight Factoring And How Does It Work? 

Also referred to as truck factoring, freight factoring is a financial service that enables trucking companies to sell unpaid invoices to a factoring company and receive cash instantly. Instead of waiting to receive payments from customers who pay slowly, companies can access funds quickly with freight factoring and fulfill essential business obligations like maintaining drivers, paying their salaries, and refueling.

The following steps explain how the process of freight factoring works: 

1. Deliver the Load and Issue Invoice. The invoice is raised after the freight is delivered. The trucking company raises an invoice with the shipper or broker.
2. Auction Invoice to Simply Factoring Brokers – selling invoices to a factoring company like Simply Factoring Brokers bypasses the waiting period for payment.
3. Cash Availability – A portion of the invoice value between 80 – 95% everts within 24 – 48 hours
4. The Customer Pays the Invoice – The shipper or broker will pay the full invoice sum to the factoring firm as per the stipulated payment terms.
5. Final Payment and Fees – After a payment is made, the balance to be paid is always less than the total invoice amount due to a small factor fee charged by the factoring company. This balance is released to the trucking company after payment is received.

The steady cash flow solution provided by the factoring company ensures that trucking companies do not worry about overdue payments threatening to slow their growth.

The Advantages of Freight Factoring for the Trucking Business

A plethora of benefits Freight boasts for all industry sizes why so many businesses go for this financing solution:

1. Immediate Cash Flow

– Getting funds without waiting ensures hassle fee business operations for contractors.

– Maintenance payments are also effortlessly managed like fueling, repairs, insurance, and payroll.

2. Lack of Extra Debt

– Freight factoring adds no liabilities to balance sheets as traditional loans would.

– All you’re doing is selling an invoice you already own for a pre-determined immediate payout.

3. Credit Protection and Risk Reduction

– Non-recourse factoring is one of the products offered by many factoring companies, which protects trucking businesses from unpaid invoices.

– If a customer cannot pay because they are bankrupt, the factoring company takes the loss.

4. Simplified Operations and Faster Growth

– Trucking businesses can have more appeal and concentrate on enhancing operations when invoice collection is outsourced to a factoring company.

– Businesses have the capacity to take on new contracts, expand their fleets, and hire additional drivers due to having reliable cash flow.

5. Scalability and Flexibility

– If the invoice generation as a result of the services rendered increases, funding access also increases, making freight factoring an optimal choice for expanding businesses.

– There is no need for any long term commitment such as with loans. Businesses can factor as many or as few invoices as they want.

At Simply Factoring Brokers, we help trucking businesses get the best terms, rates, and flexible solutions from leading factoring companies.

Industries That Benefit from Freight Factoring Payment Processing

Freight factoring is widely capitalized throughout the subsectors of the transport and logistics industry including:

Owner-Operators and Small Fleets

– Cash flow is crucial for sustaining a business. Independent truckers and small fleet owners receive the most benefit from freight factoring as it allows access to immediate cash.

Large Freight Carriers

– Multiple contracts translate to greater business for large carriers which creates ample opportunities to effectively improve their cash flow and expand the fleet.

Freight Brokers

– Waiting for payments to be received from shippers can put brokers in an awkward position. Factoring allows brokers to make carrier payments as per the contract while waiting for the corresponding payment to come in later.

Specialized Freight Haulers

– The companies transporting refrigerated goods, hazardous materials, and oversized loads often deal with significant financial strain. The sheer cost of operating these kinds of vehicles is massive. Freight factoring offers cash to cover high operating costs.

If your business is in the trucking industry, Simply Factoring Brokers can help you get matched with a freight factoring partner that meets your specific needs.

How Simply Factoring Brokers Helps You Get the Most Optimized Freight Factoring Service

Overwhelmed with all the options available to you for freight and logistics payment processing? That’s exactly why Simply Factoring Brokers exists. They make the entire process easier for you by connecting your needs to trusted partner associates who provide:

1. Competitive Advance Rates Offer 2. Up to 95% of the invoice value is advance paid which is treated as collateral from your receivables as it is retained by the factoring company.
2. Skilled in Securing Funds Quickly

– Ensure the trucking business has the available funds necessary to run smoothly by getting paid within 24-48 hours.

3. Non-Recourse Factoring Options

– Guarantee non-recourse factoring with the risk of non-payment being assumed by the factoring company. Protect your business from unpaid invoices with non-recourse options.

4. More than One Flexible Contract Term

– Unlike many providers, we assist you in finding a long term or even occasional factoring solution that seamlessly integrates with your business model despite their frequency of use.

5. Support by a Person and Not a Bot with Advice from Professionals

– Choose from a wide array of business factoring options with the help of our professional guides adjusting to your personalized business goals.

Simply Factoring Brokers connects you to the best freight factoring providers who offer ideal pricing, fast funding, and flexible terms.

Conclusion: Protect the growth of your trucking business by using Freight factoring Services

Unpaid invoices are a truck’s business greatest nightmare as their steady cash flow is essential for fulfilling ongoing expenses. To such companies – freight factoring is the answer, enabling businesses to focus on growth while effortlessly converting arrange working capital.

Here at Simply Factoring Brokers we focus on trucking companies to provide them with the best factoring solutions available. We help connect independent owner-operators and large fleet managers alike with dependable factoring companies that guarantee their financial needs are met.

Want to manage your cash flow better? Visit Simply Factoring Brokers or simply contact us today for more information on how freight factoring can help your business.