Do you feel that your trucking company is heading straight for a cliff? Do you feel that your trucking company is stuck in neutral? Or worse, do you have lots of slow paying freight bills and not a lot of cash in your business bank account?

Having slow paying clients is one of the worst problems that you can have. Especially when you own a cash hungry trucking company that needs money to pay for drivers, repairs, fuel and equipment. The biggest cash flow issue comes from your slow paying customers that can take up to 60 days to pay your freight bills.

If you are like most owners, your first reaction is to try and get a loan. However, a loan will only cure the temporary problem. What will happen in four months when the loan money has run out? You will be left exactly where you are standing now. Back to square one.

A better solution would be to eliminate the slow payments all together. Note that I did not say that we should eliminate the slow paying clients…..just the payments. What do you think you could do if all your freight bills were paid in two days instead of 30 or 60?

There is a solution that can help you accomplish that. Is called freight bill factoring and is one of the best financing tools for transportation companies. It eliminates the guesswork of having slow paying clients. Freight factoring provides you with immediate funding from the moment that you generate invoices from approved clients.

Invoice Factoring provides you with the necessary funding to meet your expenses. But more importantly, it provides you with the necessary funding to capture new opportunities and new contracts so that you can haul more loads and grow your company. With factoring, you no longer need to turn away opportunities just because they may be slow payers.

Qualifying for factoring is usually easy. The main requirement is to have freight bills from good credit worthy clients. Things such as financial statements or personal credit reports are seldom required, making the application process fast, easy and very user friendly.

Factoring is a cost effective solution that can help you drive your freight company to the next level.

The trucking industry is growing by leaps and bounds. It is a well-known fact that the industry will grow consistently for the next decade. Basically, trucking companies are delivering truck loads of freight every day and are growing quickly and profitably. They are an engine that is driving the economy.

This is all good news for trucking companies, at least for those that can deal with the challenges of paying for repairs, fuel and meeting payroll on time. This can be challenging for a new and growing company, since most clients pay their freight bills in up to 60 days. Waiting can kill the business.

Of course, going to the bank for money won’t help. Banks only finance businesses that have good cash flow, lots of assets and can provide three years worth of financial statements. Of course, if you could meet those requirements you would not need business financing.

A better option is to factor your freight bills. Freight factoring can provide you with money to pay for repairs, fuel and drivers. And as opposed to bank financing, factoring is easy to qualify for and simple to use.

Here is a sample transaction:

1. You sell your freight bill to the factoring company
2. The factoring company advances you up to 95% of the bill (90% is more common. Sometimes a small reserve is held)
3. Once the freight bill is paid, the fee is charged and any reserves are rebated

The main requirement of factoring is that you do business with credit worthy clients that pay their invoices consistently. The service can generally be set up in a few days, and once it’s set up, the financing is continuous.

As an added service, factoring companies will also check the creditworthiness of your new prospects, enabling you to only do business with clients that will pay their invoices on time.

Many trucking company owners have used freight bill factoring to grow their transportation companies, enabling them to take on new loads, and add equipment while easily keeping up with expenses. Factoring can help you drive your trucking company to financial success.