If you own a trucking company,you will inherently find yourself in need of better cash flow, irrespective of the size of your enterprise. This is because of how long it takes customers in this industry to pay back their invoices. In order to meet financial obligations or aspirations for expansion, freight companies are using tools like invoice factoring to receive their payments quicker. It allows trucking companies to turn unpaid invoices into immediate cash by paying a small fee to factoring entities that then take over the outstanding invoices. Factoring offers peace of mind during cash flow gaps and allows freight services to pursue growth and take back control of the speed at which they pursue business building initiatives.
Factoring allows owners to monetize outstanding invoices, getting trucking companies paid immediately after completing a job — rather than waiting. The factoring company traditionally offers80-90% of the value of an invoice up front (less a nominal factoring fee), then returns what’s remaining for a small percentage once the customer pays what they owe in full. This strategy is particularly beneficial to small business owners, as they no longer have to wait to recuperate funds before taking on additional work. For larger trucking enterprises on the other hand, invoice factoring allows them to grow at a consistent pace. It is also a great opportunity to finance growth initiatives. If you’re ineligible for bank loans, either due to an insufficient credit score or outstanding debt, don’t wait to collect payments for invoices — instead, find the right factoring partner to help you qualify quickly and easily.
Accutrac Capital is one dependable factoring entity that works to alleviate cash-flow and financing issues in the trucking industry. They allow trucking businesses to maintain sufficient working capital even if their customers take a long time to return payment.
Their most popular option is flat fee factoring, where clients receive the same day cash advance amounting to 97% of their invoice for 1.59% of the total amount. It alleviates the frustration of having to chase down customers, as the factoring company takes this responsibility on themselves. For large fleets and operations, the company also offers a factoring line of credit starting at 0.022% per day. Finally, if a client knows their customers will pay what they owe back relatively quickly, but requires the cash right away, flex factoring is very convenient, and companies pay as little as 0.49% of the invoice — an option that is valid for 10 days.
Few companies can afford to wait 30 to 90 days to get paid on an outstanding invoice, which is why so many trucking companies use invoice factoring as part of their overall financial strategy. If you run a trucking company of any size, you realize how many challenges exist, from payroll to invoicing to staffing. Every fleet or transportation company faces a myriad of challenges every day— and so every company needs to have a solid backup plan in place. No wonder so many trucking and transportation companies are utilizing the flexibility of freight bill factoring to maintain cash flow and seize growth opportunities.