If you are transferring loads across the city or across the continent, you are familiar with the issues you can face on an every day basis, with respect to covering your working capital requirements. Freight factoring can assist easing some of those problems, regarding the aspects of covering the costs of paying for petroleum, insurances, upholding, licenses and tolls.
Most of you are required to pay this operating cost if not every day, then for certainly on a weekly basis, and when you are gathering your statements after a 30, 40 or even 50 day cycle, this can make a cash resist, while you wait to get remunerated.
In that case, freight factoring can be a real pressure reliever so you can cover these expenses and have small cash left over for other things, while you wait to acquire payments from the client. There are, on the other hand, many companies out there that can factor your bills, but what are the things that you should look for when considering submitting your statement for freight factoring?
Does the finance company appreciate your commerce?
You are required to be certain that the company you are going to associate with understands the requirements of your business. If they will not take the time to understand your commerce and what’s important for your business, how can they work with you on an every day basis, to make sure there are no breaks in your working capital?
Will you be capable to get in touch with the freight factoring company when you require to?
If the need arises, will you have somebody accessible to speak with you regarding your account or will you have to wait days for a reply? Will you have a devoted person for your account, or will you be dealing with a call center? Either alternative can be well, but you require being relaxed with what you will be dealing with.
How much time it takes to have your statements processed so that you can acquire your invoices factored?
Some corporations may take up to a week for the dealing out with your statement to be capable to fund them. Are you willing to stay that long and wait for it, or do you required to have the funding right away? It’s an important question that can arise, as you can also wait for the client to pay, and sometimes, the client can pay sooner than the alternative.
Does the freight-factoring corporation you are considering to employ have the financial ability to fund your business without interruption?
It is intelligent to be certain that the freight factoring company has the backing to fund you when needed and not create issues for you, with respect to having to stay and wait for funding (having the bills paid) as their funds have been utilized.
Is the advance rate satisfactory for your requirements?
Usually speaking, funding levels can vary from 50% of the statement value up to 80% of the statement value, and you need to be certain what you require previously to making your option of which business to employ.
You might have noticed that cost was not in the top things to identify regarding freight factoring. While this is significant, pricing is NOT the most significant. While you do not desire to overpay for this type service, going with a negotiable basic cost may have other costs with respect to service that far offset the advantage of a small cost. Cost is significant, but Service is far more significant. Be certain that the service you required is assured and then look at cost and make your choice.
Therefore, if you want the services of a freight factoring company, you must consider the entire above factors. Beside these factors, you must also consider the rates factor, because it will finally affect your economics conditions. In this new light, always try to choose the most affordable and best company for your needs.