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To Factor or Not to Factor

The trucking business can get confusing whether you have one truck or a huge fleet. How quickly you get paid can make or break your business. Having cash on hand is important and necessary for the day to day expenses of your business, but unfortunately, many customers are very slow to pay you for your services. According to the website of the freight factoring experts at TBS Factoring Service, freight factoring is another payment option besides having to wait on slow paying customers. Freight factoring is when you send the invoices for your services to a third party, who pays you immediately, and then that third party collects payment from your customer at a later date. It gets you your money quickly and when you need it. Customers who are extremely slow at paying their invoices can be frustrating, so this kind of service relieves that stress as well. Many factoring services will also offer other services such as referral programs and fuel cards with rewards systems, making it easier to manage all of your expenses in one location. The downside to factoring is that it is not free. The third party service will pay you less for your haul than what they will be receiving from your customers. The percentage that you will be losing will vary by the particular company offering the service. The benefits of being paid quickly can outweigh the costs of the service, but if you have a very large fleet and complete hauls quickly, the loss can add up fast. Freight factoring is not for everyone, but for some it can be what allows their business to stay afloat and run smoothly. The costs and benefits must be weighted in your particular situation in order for you to decide if factoring is right for your...
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