New to Factoring?

For those who aren't familiar with factoring, it is basically a fast way to get cash to run your business.

Factoring is Not a Loan

When you send your customers an invoice, they usually have 30 days to pay you back. Factoring companies will give you the bulk of the cash up front, sometimes within 24 hours, and collect the payments from your customers themselves. Once the invoices are paid in full, you’ll get the balance left over, minus a small fee.


Factoring Doesn't Require Debt

Sounds simple enough – fast cash for your business – no loans, no debt.

So how do you go about choosing the best factoring company?

Not all of them are created equal. Not all of them will give you the same level of service you need to help grow your business.

Everyone claims they have the simplest rate structure in the industry, no long-term contracts, same day funding, no up-front fees, no monthly minimums or maximums, etc., etc., etc.

We also offer these same benefits, but we GO THE EXTRA MILE FOR YOU that other factoring companies don’t.

Here’s Why We Are The Factoring Company You Need For Your Lansing Business

No other factoring company matches our level of superior service and offerings.


As you can see, we simply have more to offer you.

Other factoring companies don’t even compare.
Lansing

And Not All Factoring Companies Can Say This:

More than half of our new business comes through client referrals.

Some of the benefits you receive with factoring are:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Information for the city of Lansing

Lansing /'læns??/ is the capital of the U.S. state of Michigan. It is located mostly in Ingham County, although portions of the city extend west into Eaton County and north into Clinton County. The 2010 Census placed the city's population at 114,297, making it the fifth largest city in Michigan. The population of its Metropolitan Statistical Area (MSA) was 464,036, while the even larger Combined Statistical Area (CSA) population, which includes Shiawassee County, was 534,684.The Lansing Metropolitan Area, colloquially referred to as "Mid Michigan", is an important center for educational, cultural, governmental, commercial, and industrial functions.

 

The area is home to two medical schools, one veterinary school, two nursing schools, two law schools including Western Michigan University and Michigan State University a Big Ten Conference university (Michigan State), the Michigan State Capitol, the state Supreme Court, the Court of Appeals, a federal court, the Library of Michigan and Historical Center, and headquarters of four national insurance companies.Lansing is the only U.S. state capital (among the 47 located in counties) that is not also a county seat. The county seat of Ingham County is Mason, but the county maintains some offices in Lansing. The Lansing metropolitan area's major industries are government, education, insurance, healthcare, and automobile manufacturing. Being the state capital, many state government workers reside in the area.

 

 

Information for the state of Michigan

Products and services include automobiles, food products, information technology, aerospace, military equipment, furniture, and mining of copper and iron ore. Michigan is the third leading grower of Christmas trees with 60,520 acres (245 km2) of land dedicated to Christmas tree farming. Michigan ranked fourth in the U.S. in high tech employment with 568,000 high tech workers, which includes 70,000 in the automotive industry. Michigan typically ranks third or fourth in overall Research & development (R&D) expenditures in the United States. Its research and development, which includes automotive, comprises a higher percentage of the state's overall gross domestic product than for any other U.S. state.

 

The state is an important source of engineering job opportunities. The domestic auto industry accounts directly and indirectly for one of every ten jobs in the U.S. A wide variety of commodity crops, fruits, and vegetables are grown in Michigan, making it second only to California among U.S. states in the diversity of its agriculture. The state has 55,000 farms utilizing 10,000,000 acres (40,000 km2) of land which sold $6.6 billion worth of products in 2008. The most valuable agricultural product is milk. Leading crops include corn, soybeans, flowers, wheat, sugar beets and potatoes. Livestock in the state included 1 million cattle, 1 million hogs, 78,000 sheep and over 3 million chickens. Livestock products accounted for 38% of the value of agricultural products while crops accounted for the majority.

 

FAST MONEY FOR BUSINESSES THAT NEED IT. Don't wait long periods for a loan  

Companies of all different sizes, including start ups, use factoring; and today factoring has become common business practice across many industries. -Lansing Factoring Companies

 

 

YOUR BUSINESS AND CASH FLOW IS AS IMPORTANT TO US AS IT IS TO YOU.  

Lansing Factoring Companies Articles

Factoring in the Future of a Trucking Business: A Story

 

John Thompson let the phone ring on his desk. He let his morning coffee cool and left his cigarette to ash itself in the tray, because he is trying to make the biggest decision ever for his trucking company. Thompson Trucking Company was at a turning point of growth and John had to decide if signing with a factoring company was the right way forward.

 

John's father had started as an owner-operator and had grown Thompson Trucking Company into a fifteen trailer fleet over forty years. There had been some hard times when it seemed everything was going to go under and even John's mother strapped herself into a cab to make hauls. His father had lived long enough to witness the price of hires drop during the recession and watch the eruption of fuel prices afterwards. Now the company was solely in John's hands and he wanted to live to see it in better shape for his sons.

 

To move Thompson Trucking Company ahead into the future, he needed a steady cash flow but there was just not enough money to go around. His employees needed to be paid. They had families and household bills too. Some of the refrigerated trailers were in need of repairs and he felt to stay competitive it was also a good idea to invest in specialized haulers to be ready for the constant requests he was getting for loads of new energy and agriculture equipment. Every time he had to turn down a request, Thompson Trucking looked weak in a very strong market.

 

His father would have told him to wait and to take his time adding on new technology. John allowed himself a good hard chuckle. His father had been against placing GPS units in the cabs. He would say, "Why do you need the voice of some woman to tell you to get off at an exit that has been the same exit that has been there for years?" Also his father had the habit of teasing all the drivers he caught switching into automatic even though driving in automatic was much more efficient though not manly in his father's eyes. His father days were long gone and technology was actually an important improvement for the business such as having Qualcomm to cut down on fruitless time communicating on the phone for bills of lading.

 

John believed a successful man is always thinking of his next step. What would be the next step for Thompson Trucking? And how would he be able to afford it? Funding was all tied up in the mortgage for the office and garage and in the fuel bills. He just finished paying off the small bank loan for installing satellite radio in the trucks for the guys.

 

But was factoring the answer? There was a lot he didn't understand about the process. It sounded a lot like ninth grade algebra which just didn't feel like it belonged as part of the trucking business. Factoring companies buy your invoices and manage your accounts receivable for a certain percentage of the invoiced amount. The factoring company gives the trucking business its payment right away which allows the business to have continuous cash flow so it can pay employees, buy fuel, and make repairs for upcoming hauls. Without the assistance of factoring, you have to wait for customers to send you the payment which is often 30 days late. In those 30 days, a trucking company can't pay its bills and employees in invoices.

 

Now it was time for John to do his homework. John had heard that there were companies that charged for same day money transfers and would only advance a percentage of the money owed to your company while holding the rest in a private account if they didn't get their bill payment within 60 or so days. Plus it was worse still if the customer didn't pay up at all because then the factoring company would take it right out of the money supposed to be coming to you! Through the grapevine, he'd also heard about how some companies suddenly slipped you onto a sliding scale of percentages even if you had already signed a lengthy contract for maybe 3% or 7% so there you are with 10% coming as a cost to you out of the freight bill. His friend Ronnie who had a trucking business in Missouri, was run nearly into the ground by a factoring company that charged him the full freight bill on top of the factoring fees. Well, what was the point of going to a factoring company if there was shady business like that going on?

 

But it turned out to be quite easy. All the factoring companies he researched were open about their business practices and very friendly on the phone when he called. Their customer service actually knew things about their company and spoke in nice clear English so he could understand what was being explained. He didn't mind signing an exclusive contract. He liked the idea of a long term commitment so he knew he wouldn't have to bother going back and forth to different companies and wasting time filing more forms. Nobody charged him for credit checks and they offered him a fuel advance on the pick-up of the load. Many companies offered a non-recourse factoring program that suited him just fine. Also he was happy to hear how much he was offered in terms of percentages on the freight bills. It was good money.

 

It was really refreshing dealing with the factoring people. They were more personable than those loan managers at the bank. It seemed as though those bank people spoke another language, but these factoring guys knew the trucking business and spoke to him like a client, not like a beggar for a handout. The factoring companies didn't worry over his credit and the debt troubles his father had had in the past of the company. Factoring was based on the credit of his customers and on their reliability which worked well for John because he and his father had built up good strong relationships over decades with their list of clients. So he knew they would understand when the factoring company contacted them for the invoices. His clients wouldn't think poorly of Thompson Trucking and the factoring companies appeared capable of handling the accounts receivable in the same polite manner that his father had used over the years.

 

John stepped out of his office to let his secretary know to expect the arrival of the factoring contract shortly. He felt exhilarated by the new possibilities that would make the future of the company fun again and put the stress of the difficult times behind him. With the capabilities of this new cash flow, John could actually expand Thompson Trucking Company further across the country and perhaps even go international into Canada. His heart felt full knowing his sons wouldn't have to worry about money because of the right decisions he had made for their trucking business.

 

 

 

FAST MONEY FOR BUSINESSES THAT NEED IT. Don't wait long periods for a loan

 

 

Lansing Factoring Companies Articles

Financing Temporary Staffing Agencies

 

In recent years temporary staffing agencies have become very profitable, because the current business environment prefers to outsource employees rather than hire them. This situation creates a very attractive and viable opportunity for temp staffing agencies. But, similar to other businesses, in order to operate a successful temp staffing agency, working capital is an absolute necessity. This requirement of working capital has become a problem for most agencies who often suffer from a cash flow crisis. Having adequate cash flow prevents the company from being run effectively, thus stopping the company from adding new clients. The result is that the business fails to grow. Fortunately, there is a solution to this problem, and the solution is the right type of financing.

 

Payroll and Bills Must Be Paid on Time!

 

The most important and probably the biggest expense of any temp staffing agency is employee payroll. Obviously, employees expect to be paid regularly and on time, and if this is not the case, they'll quickly move on and find work elsewhere. In addition, the agency needs funds to pay for other employee-related expenses, such as employment taxes. When a business fails to comply with tax regulations the costs involved can be extensive and can the even put the business itself in jeopardy.

 

Business Growth Is Impossible without Funds

 

Generally, Government and commercial clients pay their invoices somewhere between 30 and 60 days, and it's this timeframe that creates problems for temp staffing agencies. When an agency takes on a new client, before they start getting paid, the agency must be able to pay the employee's salary for up to two months.

 

This means that the only way to grow a temp staffing agency is to have a cash reserve to pay for running expenses. If you don't have a reserve of funds, then you can't take on new contracts; and if you work with larger contracts you need a larger reserve. And this is where it becomes a vicious cycle, because if you can't take on new contracts then business growth is impossible.

 

Payroll Funding: Helping Your Business Grow

 

Fortunately, there is a solution available for temp staffing agencies to resolve this very common financial problem, and it's known as Payroll Funding, or Payroll Financing. Payroll Funding is a solution that's been designed to help staffing agencies access much-needed working capital.

 

Payroll financing is actually a type of Invoice Factoring, allowing you to finance your slow-paying receivables. This type of funding provides your temp staffing agency with immediate funds. Now there'll be no more waiting for your Government and commercial clients to pay in 60 days - the payroll funding company will pay you within a day or two! Now you'll have the working capital your agency so desperately needs to meet payroll and other expenses; and now you can move forward and grow your business without constantly worrying about slow paying clients!

 

How Does Factoring Work?

 

Factoring is a very straightforward process. Basically, invoices are financed in two separate payments, with the first payment covering approximately 90% of the gross invoice value, and the second payment, which is the remaining 10% less factoring fees, is remitted to you once your client has paid. The first payment is paid into the temp staffing agency's bank account very soon after the invoice has been submitted for financing. In the meantime, your clients are not required to pay any sooner - they simply pay on their regular schedule.

 

Payroll Funding Is Available to Small Agencies

 

One huge advantage of factoring is that it's available to small agencies (even start-ups!) that don't have many assets. Because it's the invoices which are the assets the factoring company is financing, it's the credit quality of your customers that the factoring company is most interested in. Factors can only finance invoices if your customer (the payer) has good commercial credit, and that's why factoring has become a very viable and attractive option for both small and growing agencies whose greatest asset is their good clients.

 

Growing Your Agency with Factoring

 

Let's take a closer look at how your temp staffing agency can use invoice factoring to grow your company. We'll assume for the purpose of this article that you have a new client who requires six full-time employees for a few months. This new client is a large corporation and has a good reputation. The problem with this corporation, however, is that they pay their invoices in 50 days, and there's no way you can afford to carry the cost of the contract.

 

What's the solution? The solution is actually quite simple: you invoice the client weekly and factor the invoice! This funding strategy allows you to service the contract by providing your agency with weekly funds to pay employees. Providing you have clients with good credit and your agency provides good services, receivables factoring can be used very effectively to grow your business.

 

When factoring is used properly, it can help grow your temp staffing agency well beyond its current financial capabilities.

 

 

 

 

 

 

Lansing Factoring Companies Articles

How Medical Staffing Helps The Medical Industry

 

Mary Henderson sat in her office, waiting for the phone to ring. Her job was a busy one, and she had stopped all her calls and shut her door five minutes before the phone conference was set to begin just to get some time for herself. The truth was she was stressed to her breaking point. Her company Med Staff needed to hire three new people to cover the demand of their clients. The problem was, they couldn't. They were short on funds.

 

Med Staff did temporary medical staffing. They employed LPN's, RN's, and a few others of the same ilk. Companies that needed nursing for a short amount of time paid Med Staff, and the nurses were sent over on short term contracts. Then they came back, and they were sent somewhere else.

 

A retirement home had contacted Mary two weeks ago, they were undergoing an expansion, and they would need temporary staffing until they could appoint permanent nurses to the shifts. Mary had known she didn't have enough people for this, but she took the contract on anyways, figuring she could hire people. There were always a number of nurses and technicians applying for work at Med Staff, and she knew it wouldn't be a problem to hire a few new people.

 

There had been a problem though. There simply wasn't enough money in the books to do it. The company was doing fine, but a quick expansion, even as small as three people, simply wasn't going to happen, not without help.

 

She had gone to the bank for a loan, but they had denied her. It seemed to Mary that the only people who could get loan money from a bank were the people who didn't need to do so. And then she had found something different, a website online about factoring. She had looked the site over, and set up the conference call.

 

The phone rang, she picked it up. "Hello?"

 

"Hi, is this Mrs. Henderson?" a cheery woman's voice asked over the phone."

 

"It is."

 

"Great! My name is Stacy, I'm going to help you today."

 

"Okay great." Mary said.

 

"I'm looking over the form you filled out, it looks like your company temporarily staffs medical professionals?"

 

"Yes," Mary said. "Nurses mostly."

 

"Great," Stacy said. "And if you called me, it means you ran into a snag."

 

"I took a contract to fill five places in an expanding retirement community. I have two people available but needed to hire three more. Unfortunately, we just don't have that kind of money in the books right now. We have a few outstanding invoices yet to be paid, but until they come in, there's nothing I can do."

 

"Do you know how factoring works?" Stacy asked.

 

"Not really," Mary admitted.

 

"Okay, well we don't look at your business credit, we look at your clients' credit. We know they have some time to pay bills, and we're interested to see if they can pay those bills. If they can, we become interested in helping you out, because we think all businesses should have a fair shot to make it, and sometimes things just don't work out."

 

"This is the first time it hasn't worked out," Mary said. "And it's hard."

 

"I know. I hear about it every day. The cool thing about my job is I get to help fix it. So what we do, if we feel secure in our ability to help you, is we buy a piece of your accounts receivable. We aren't just loaning you money, we're basically becoming active in your business. That is you get the money you need right now, but we have an assurance that we get our money back, later down the road."

 

Mary nodded behind her desk, even though the other woman couldn't see her. She had never heard of factoring before she came across the site on the internet, but the way Stacy explained it certainly made sense.

 

The call continued, with Mary giving the information that Stacy would need. She promised to get back to her within a couple of days, and then they hung up. Mary went on with her work, and a day and a half passed.

 

Mary was at her desk when he phone rang then. It was Stacy.

 

"Good news," she said as soon as Mary said hello. Mary couldn't help but smile as Stacy went on. "We're going to be able to help you out."

 

"You don't know how great it is to hear you say that," Mary said.

 

"Believe me, I do," Stacy said. "I get to say it more often than not, and I know that we're really helping good people, and good businesses."

 

"The bank, they couldn't do anything," Mary said, she felt salty tears stinging her eyes as they welled there.

 

"They aren't built to help people like we are. They just want as much money as they can get. We want money too, because it's a business, but if you don't succeed, we don't succeed, and it's also important to us that we help people."

 

"So what's next?" Mary asked.

 

"Well the real answer is I fax some stuff over for you to fill out and sign, but the fun answer is your business gets the help it needs, and you keep going to work each day. Well, not the weekends."

 

Mary couldn't help but laugh. "Believe me," she said. "I work plenty of weekends."

 

Stacy laughed as well, and then got the fax number she would need. Once again the women hung up and Mary let out a long breath as she sat back in her chair. She used a tissue to dab the tears from her eyes. She knew everything was going to be okay.

 

 

 

 

 

Lansing Factoring Companies Articles

Factoring: An Overview

 

What Is Factoring?

 

'Factoring' is when a third party commercial finance company purchases the Invoices or Accounts Receivable from a business. The finance company concerned is called a 'Factor' and the transaction is known as 'Factoring'. Factoring is also known as 'Accounts Receivable Financing' because factoring occurs when a business needs to access cash quickly, quicker than if it had to wait the 30 to 60 days (or longer) to receive payment from a customer.

 

The majority of factoring companies purchase invoices and advance cash within 24 hours, although the terms and nature of factoring can differ between industries and different financial service providers. Depending on the industry, the customers' credit histories, and various other criteria, the advance rate can range from between 80% and 95%. The business also receives back office support from the factor. Once the factor has collected from the business's customers, the business will be paid the reserve balance of the invoices, less a nominated fee for assuming the collection risk.

 

The main benefit of factoring is that a business is not required to wait one or two months (sometimes more) for payment by a customer - the business will receive cash in hand to operate and grow their business. It's important to note that factoring is not a loan: there's no debt with factoring. Funding is unrestricted, which means that a business has more flexibility than borrowing from a bank.

 

The Five Simple Steps of Factoring

 

1. As a business, you provide a service to your customer;
2. The invoice for this service is sent to a factoring company;
3. On this invoice, you'll receive a cash advance from the factoring company;
4. It's now up to the factoring company to collect full payment from your customer;
5. Once payment has been received, you'll receive the balance of your invoice account from the factoring company - minus their fee.
The Advantages of Factoring

 

There are many reasons why factoring has become a popular and valuable financial tool for businesses today. The key benefit of factoring is that a business receives a quick boost to its cash flow: in fact, many factoring companies offer cash on their Accounts Receivable within 24 hours! The factoring company takes responsibility for collecting customer payments, and may also evaluate the payment and credit histories of a business's customers.

 

Other Benefits Include:

 

' When a business needs access to cash, factoring can be customized and managed in order to provide the necessary capital;
' The business balance sheet will not show this financing as a debt;
' Factoring is not based on the company's credit or business history: it's based on the quality of its customers' credit;
' Factoring is not determined by the company's net worth: it provides a Line of Credit based on sales;
' There's no limit to the amount of financing through factoring, unlike a conventional loan;
' Factoring is an ideal solution for start up businesses that often require immediate cash flow.

 

Is the Concept of Factoring New?

 

No, it's not! In fact, the origin of factoring comes from overseas trade among nations and dates back several centuries to the 1400s when it became part of doing business in England. In the year 1620 it arrived in America with the Pilgrims. Like other financial tools, factoring has improved and evolved over the years. It became an effective way of creating cash flow in the United States at a timewhen companies faced strict limitations when trying to secure loans in the country's damaged banking system.

 

Who Uses Factoring?

 

Factoring is available for companies of all sizes, ranging from a one person business to Fortune 500 companies. Every business can use factoring as an effective way of increasing their cash flow. In addition, factoring spans all types of industries, from transportation, trucking, textiles, manufacturing and distribution, staffing agencies, and oil and gas.

 

The cash generated from factoring is used by companies to purchase new equipment, pay for inventory, expand operations, add employees, and basically cover any expenses related to the running of their business. The beauty of factoring is that it allows companies to make quick decisions and to expand at a faster pace.

 

How Does Factoring Work?

 

For the purpose of this post, we'll describe a fictional example as a way of illustrating a common factoring situation.

 

XYZ Transport is a trucking company: their intention is to double their fleet size over the next two years in order to service more clients in the West. The company has just successfully won a new customer on the West Coast who requires freight to be shipped from Oklahoma to Los Angeles. This new customer is more than happy to pay for the service within 30 days; however, that won't cover all the immediate costs involved, like payroll, fuel, and maintenance costs of running the route.

 

This is a familiar situation for the owners of XYZ Transport: the lack of available cash flow in the past has prevented the company from accepting new business. So now XYZ Transport has turned to a factoring company: they have agreed to sell the West Coast customer's invoice to the factoring company in exchange for a 90% advance on the total amount - within 24 hours! This much needed influx of cash will replenish the trucking company's reserves and allow it to continue running the Oklahoma - Los Angeles route. In addition, XYZ Transport now has the added flexibility of taking on new customers.

 

How Much Do Companies Factor?

 

Each company has its own unique business needs, so somecompanies only factor invoices for customers that are slow in paying, whilst other companies factor all of their invoices. Companies can factor receivables ranging from a few thousand dollars right through to millions of dollars each month.

 

What's the Difference between Factoring and a Traditional Bank Loan?

 

Factoring, also known as Accounts Receivable Financing, is a quick, flexible and effective way for businesses to create a steady cash flow stream. See below for how factoring is different to a Line of Credit at a bank or a traditional business loan

 

 

 

 

 

Lansing Factoring Companies Articles

Important Points to Remember When Choosing Your Factoring Company

 

Now that you've decided that factoring would be a solid business decision for your company, the next step is to find the perfect factoring company for you. Once you start looking you'll discover that there are many factoring companies (or 'factors') in the marketplace, and this is the perfect situation for you as a potential factoring client.

 

But it can also be confusing, because now you have to find the right factoring company to suit your business's needs. To assist you in making the right decision we've listed below the main issues that should be considered when choosing a factoring company.

 

Factoring Fees and Terms

 

Before making your final decision and entering into a factoring agreement, check out the fees applicable and the terms of the contract. Both of these can vary a lot, depending on the factoring company and the industry it's serving. When you start your research you'll discover that some factoring companies charge a flat fee: this fee is, in effect, a certain percentage of the total value of the customer invoices you sell to them; whilst others have additional charges to cover the general costs of doing business - such as, money transfers, shipping, collateral, and so on.

 

Ensure that the factoring company you're considering working with is transparent and upfront with you about its fee structure. In addition, you may want to consider a long term contract with your factoring company if it includes flexible rates or a price break. If you're receiving competitive offers from other factoring companies or you have increased factoring volume, you'll discover that many factoring companies will be prepared to adjust their rates. A one year contract is the industry standard for most factoring agreements. Generally, unless you give your factor a 60 or 90 day notice, your factoring contract will automatically renew.

 

What's the Difference between Recourse and Non Recourse Factoring?

 

It's important that you understand the difference between recourse and non recourse factoring prior to choosing your factoring company, because you need to know what the best fit would be for your company and your customers. So, with non recourse factoring, all of the credit risks for the collection of the invoice belong to the factoring company; while recourse factoring means that, with you being the client, you'll ultimately be responsible if the factoring company is unable to collect payment on your customers' invoices.

 

There are benefits to recourse factoring, and perhaps the main benefit is that it's less expensive than non recourse factoring. If you have a recourse agreement and the customer defaults on payment, it doesn't automatically mean that you'll be asked to settle the debt out of pocket. Generally, what happens is that the factor will hold back a portion of either future cash advances or payments being held in reserve, with the money being placed in an escrow account awaiting settlement of the debt.

 

Our suggestion is that you find a factoring company that offers both recourse and non recourse factoring, because not all of your customers will be good candidates for recourse factoring. An experienced factoring company working with a strong credit team can also behelpful in ensuring you're working with good customers: this will relieve some of the pressure of being stuck with bad debt.

 

Experience and Capital: The Two PreRequisites

 

Your company should be looking for a factoring company with experience in your industry, including the capital structure to fund your business as it continues to grow. Once you start researching factoring companies you'll discover that there are a lot to choose from; however, many of these are recent start ups with limited experience. Prior to signing any factoring agreement, do your research and look into the history and background of the factoring company concerned, especially its ability to provide financial services in your area of expertise.

 

The idea with factoring is that, as your company grows, the funding of your customer invoices will grow with you.Research the factoring company's client base and their capital structure. What's a typical account size? What's the factoring volume of their largest client? Is the factoring company limited to how many debtors it can handle? In general, factoring companies that have been serving your industry for many years will usually be able to offer your business the best deal.

 

Additional Factoring Services

 

There are many more benefits to factoring than simply increasing your company's cash flow. Because the factoring company will be handling the collection of your customer's invoices, your company will be saving time and resources. A good factoring company will also be able to evaluate companies in your industry and provide credit information. In short, your factor will ensure that you experience excellent customer service. You'll be matched with your own representative who'll be able to address any questions or concerns you may have about your factoring account.

 

So, when researching factoring companies, look for a factor who not only offers additional products but provides a high level of customer service that will help your business grow by assisting you in making smart business decisions.

 

 

 

 

 

Lansing Factoring Companies Articles

The benefits of using a Factoring company versus a bank loan

 

If you are looking for a convenient way to obtain business capital, factoring is one of the best options available out there. From a recent study, it has been identified that many people go for bank financing in such instances, considering that it is the least expensive method of investing. However, factoring is associated with many other advantages and we will let you know about them through this article.

 

A proper cash flow is something that every business in the present world should have. In addition, they need to speed up their cash flows along with time. Otherwise, it will not be possible for them to get banks for financing. Unfortunately, banks are not in a position to accommodate all the financial requirements of a company, due to tough credit standards. That is where factoring comes into play. It happens when a company sells its accounts receivable to a bank or a factoring company. The amount that can be taken depends on value of the invoice.

 

Key benefits associated with factoring

 

' A company can get large amounts of capital through factoring. It is because this method is entirely based upon accounts receivable. It has impressed many small scale businesses out there since they can obtain a bigger line from their accounts receivable for services or goods. They will not be able to get such a big amount of capital from any conventional bank lender out there. Factoring is something that is based on the credit strength of your potential customers. If your company has more potential customers with healthy credit strengths, you can easily enjoy the benefits of factoring.

 

' Factoring is quicker than traditional bank loans. Since most of the accounts receivable factoring lines are in a position to be set up, approved and actively funded within a matter of few weeks, you can go through a hassle free process. However, banks will take more time to engage with their credit reviewing activities about your company. They might even wait for audit results or fiscal period closes. Therefore, if you are in need of quick business capital, factoring is the number one option available out there to consider.

 

' Factoring is something that expands quickly along with the growth of your company. Almost all the factoring companies out there support it. Your company doesn't need to have an excellent track recording of business. You just need to select a factoring company that is big enough to accommodate all your business development ambitions.

 

' A factoring company does not offer loans to their clients. Therefore, you cannot find many similarities between a loan and factoring. A factoring company will purchase your accounts receivables along with cash. Therefore, it can be considered as a similar process to increasing the working capital, while showing it as a liability in the account balance sheets. This will even reduce debt in the balance sheet, when compared to borrowing. At the end of the day, your company will get the opportunity to enjoy a lower debt to equity ratio.

 

' Factoring is less expensive than equity. Most of the businesses approach equity investors to cater their financing requirements. However, there isn't any substitute for equity capital in some expansion purposes and business investments. Almost all the equity investors expect a higher return from the accounts receivable than the cost. When it comes to factoring arrangements, you won't be able to find any dilutive effect on shareholders. This will assist you a lot to stay away from hassle.

 

' Factoring is also recognized as one of the best options available to improve your turn. In the present world, many factoring companies will verify invoices with your customers and check whether they are being paid on time. This will motivate your customers to pay the invoices on time through a gentle reminder. This will result in a better service delivery from your end as well.

 

 

 

 

 

Lansing Factoring Companies Articles

Benefits Of A Factoring Company Over A Traditional Bank Loan

 

Anyone who owns a business knows that there are times when the money goes out of your business much faster than it is coming in. This can put a company in a financial bind, making it difficult to purchase raw materials, pay their employees, or even keep the utilities on. The simple truth is that every company needs to have ready cash in order to keep their business running on an even keel and in order for it to grow. There are a number of different ways that a company can get the money they need to keep their business running and moving forward, but not all of these ways offer businesses the same freedom and benefits. This article will talk about two popular, but different types of financing available to business. The Traditional bank loan, and getting your financing through a factoring company.

 

Bank Loans

 

Bank loans are an extremely traditional way for a business to get financing. While these loans are handy they are not available to every business. For example, a fairly newly established business simply may not have the assets to readily get a loan from a bank, even if they do, the standard collateral for a business loan is the business itself, which means that if you cannot make your loan payment, you risk losing your entire business. In addition, while you apply for a certain loan amount, that is all the financing you are entitled to. Once the loan is paid off, you can then apply for another loan if the need arises.

 

Factoring Companies

 

Factoring companies do not give loans, and the money you get from the factoring company does not put you in debt. Rather the financing you receive from a factoring company is based on money your business has all ready earned, but have not yet received. Factoring companies actually purchase your account's receivable or at least part of them for a percentage of their total worth, Normally around 80%-95%. The amount of money you can receive is based on the amount of money you have earned and the accounts receivable you are willing to "sell." Once you have set up factoring account it continues as long as you wish it too and the amount of money available to you even can grow as your business grows, giving you the ready cash you need to meet your own obligations.

 

Benefits of a Factoring Company Vs. A Bank Loan

 

While not every business can take advantage of factoring account financing (you have to have a business that has account receivables) for those that can use this type of financing there are several distinct benefits.

 

1. You Won't Incur Debt. Since the factoring company actually buys your accounts receivable you don't actually incur debt like you do with a bank loan. This has many benefits including the fact, that this type of financing won't affect either your business credit rating or your personal credit rating. Should the unforeseeable happen and your business fails, you won't have to worry about anyone coming after your personal as well as your business assets to pay off a loan. With a bank loan, the debt goes onto your credit report, and even one late payment can adversely affect your businesses credit, and even the ability to get insurance and may even reflect upon your personal credit rating.

 

2. No Collateral Required. Another benefit of using a factoring company instead of a traditional loan is that you aren't required to provide collateral to the factoring company in order to secure financing, because the company "buys" the accounts receivables; not loans you money based on them. In addition, while the factoring company does run a credit check on your customers whose accounts receivables are offered for financing, the state of your credit is not an issue. This makes it easier for fledgling businesses to get the financing they need through a factoring company (as long as their accounts receivables are in good order) then from a bank, who may not feel that you have been in business long enough to be worth the risk of issuing you a loan.

 

3. Receive Your Money Faster. With a Factoring company you can actually get the money you need faster. Once the Factoring company assures itself that the customers in your accounts receivable are likely to pay their debt, the money is usually in the account within 24 hours. With a bank, there are vasts amounts of paperwork, then the loan has to be underwritten, which can take months before you actually see the loan if it is approved.

 

4. Interest is Paid Up Front. Unlike a bank loan that continues to build interest that you have to pay the entire time you have your business loan with a factoring company, you don't have to continue to pay interest as they take it right off the top, deducting it from the total amount of accounts receivable. So not only are you relieved of those monthly loan payments, but you also don't have to worry about the building up of interest, as every penny in the account is yours to spend on the business.

 

As you can see, there are several benefits that makes considering financing through a factoring company over a traditional bank worthwhile. However, there are also a couple of other benefits that a factory company can offer your business is far beyond the scope of the bank. The most important benefits is that once you sell your accounts receivable to the factory company, you don't have to take time away from running your business to collect the money owed from reluctant to pay customers. The factoring company takes over that chore, since it is now their money to collect. Factoring companies are very good at collecting these debts, saving you the time and effort that you need to devote to your growing company.

 

In addition, since the factoring company evaluates the credit quality of your customers prior to purchasing the accounts receivable you gain valuable information into which customers are likely to pay and which ones are not so likely to pay.

 

While a Factoring company is not the only way for your business to obtain the money it needs to keep growing, it does offer a type of financing well worth considering.

 

 

 

 

 

Lansing Factoring Companies Articles

Questions You Need to Ask Your Factoring Company

 

In today's marketplace we're seeing more and more factoring companies, and factoring fees, rates and agreement terms have become very competitive. This means that, as a potential factoring customer, this competitiveness should work to your advantage. However, there are some issues you must consider when choosing a factoring company to suit your specific requirements.

 

Before entering into any factoring agreement, here are some important questions you should ask -

 

What Are Your Terms?

 

As a factoring customer, you'll be looking for as much flexibility in your factoring agreement as possible. It may be that you choose a long term contract with your factoring company if it includes flexible rates or a price break. In today's competitive market, many factoring companies are agreeing to adjust their rates based on competitive offers from other factors or increased factoring volume.

 

The majority of factoring agreements are a one year contract, which appears to be industry standard, and this contract will renew automatically unless you provide the factoring company either 60 or 90 days notice.

 

What's Your Fee Structure?

 

The fee structure may vary depending on both the factoring company involved and your industry. Some factoring companies charge a flat fee, which is calculated as a percentage of the total value of the invoice. On the other hand, other factoring companies charge additional fees to cover costs associated with doing business, such as money transfers, software, and so on. Ensure that the factoring company you're considering working with is completely upfront and transparent with you about its terms and fees.

 

Are You Able to Offer Both Recourse and Non Recourse Factoring?

 

Recourse factoring:

 

Recourse factoring is less expensive than non recourse factoring. With recourse factoring, you (being the client) are ultimately responsible if the factoring company is unable to collect on your customers' invoices. However, you're not necessarily required to pay the debt out of pocket if you have a recourse agreement and the customer defaults on payment. It may be that the factoring company will withhold a portion of future cash payments or payments held in reserve, with the money being placed in an escrow account until such time as the debt has been paid.

 

Non recourse factoring:

 

When you have a non recourse factoring agreement, the credit risk for the collection of customers' invoices lies with the factoring company.Therefore, we believe it's to your advantage to use a factoring company that offers both recourse and non recourse factoring, simply because you may find that some of your customers are more suitable for recourse factoring than others. In addition, you need a factoring company with a strong credit team because they can work with you to ensure you're dealing with good customers: to a certain degree this will relieve some of the pressure of being responsible for bad debt.

 

How Long Has the Factoring Company Been in Business?

 

With the marketplace becoming increasingly competitive, today we're seeing the creation of more and more factoring companies. However, many of these companies are recent start ups, with limited industry experience. Make sure you research the factoring company's history prior to entering into any factoring agreement: also research its background into providing financial services in your specific industry.

 

Do You Have the Capital to Grow with Me?

 

The fact that there's no limit to the level of financing is the major advantage factoring has over traditional bank lending. As your company continues to grow, so too should the funding of invoices grow with you. Do your research and learn as much as possible about your potential factoring company's client base and their capital structure.

 

Does this factoring company have a limit to the number of debtors it takes on? What's a typical account size? What's the factoring volume of their largest client? You'll probably find that factoring companies who have been serving your industry for many years will have greater capacity to finance your company as it continues to grow.

 

Is There Anything Else You Can Do for Me?

 

Obviously, factoring is more expensive than a conventional bank loan, and this is partly due to the back office services that your factoring company is able to provide. Besides collections and financing, many factoring companies will evaluate companies in your industry and provide credit information. Therefore, when looking for a factoring company for your business, make sure the one you choose offers additional services and products that can assist you in making good business decisions.

 

How Do We Start Factoring?

 

Fortunately, factoring companies are not unduly concerned about your balance sheet before they decide to work with you, unlike banks. However, they do have a process to follow when selecting new clients, so be sure you understand what the factoring company is looking for when it's considering you as a client. Are they looking at your credit ratings and/or your customers' payment histories?

 

Are they looking at your personal credit score?

 

In many cases a company will start factoring because it's looking for a quick injection of cash, so you need to know how many days the factoring company will take to review and process your application.

 

 

 

 

 

Lansing Factoring Companies Articles

Freight Bill Factoring: The Best Way to Achieve Your Business Goals

 

Freight bill factoring is not a secret, but many businesses are still unaware of the benefits available to them by factoring their business invoices.

 

If you're planning on starting your own trucking business, or perhaps you already own a trucking business, you may well have heard of freight bill factoring. Many trucking companies confirm that freight bill factoring has been entirely responsible for helping them achieve their overall business goals. So, let's discuss freight bill factoring and how can it help you grow your business.

 

How Freight Bill Factoring Assists Trucking Companies

 

It was recently reported that freight bill factoring has become the financial backbone of the trucking industry, and that's not a surprising statement because factoring provides financing capital that businesses would not otherwise be able to access. The freight bill factoring process is a very simple one: your Bill of Ladings is purchased by a factoring company at a discounted rate. The trucking company receives immediate funds and, because the money received is not a loan, the trucking company is free to use these funds as they see fit. No more cash flow problems!

 

Is Freight Bill Factoring a New Financing Concept?

 

No, it's not new. In fact, freight bill factoring has been around for a long, long time. Almost every civilization engaged in commerce has used some type of factoring. Businesses actively engaged in factoring during North America's colonial period when they made cash advances against accounts receivables to enable the business to carry on with their commercial operations. Of course, factoring has become quite advanced over the years and is now more focused on financial management, collections, and credit worthiness; however, the basic idea of purchasing accounts receivables remains the same today.

 

Today, factoring companies have a lot more to offer than just funding: they now have factoring specialists who assist their clients by evaluating their customer's credit worthiness, defining credit limits, and managing their accounts receivables collections in a professional manner.

 

Right across North America we're seeing all forms of factoring companies servicing business sectors and industries of all types. It's interesting to note that, today, many large financial corporations have their own in-house factoring divisions; however, factoring companies are typically independently-owned enterprises.

 

Commercial Banks Are No Longer Supportive of Small Business

 

Commercial banks today are operating under very strict regulations with constantly changing lending criteria, thus making it very difficult for business owners to apply for and be accepted for a bank loan. Their inflexibility has left small and medium-sized businesses out on a limb, searching for alternative financing sources. Fortunately, factoring provides these businesses with the financing solutions they're looking for.

 

Freight bill factoring offers a workable solution for these businesses when conventional financing methods are simply not available. And now that banks and other lending institutions have become less friendly to small business owners, factoring as a financing remedy is looking much more attractive.

 

Interesting statistics show that the volume of factoring around the globe has now exceeded the trillion-dollar mark, with factoring companies operating right around the world. In the last four years alone, there's been an increase in factoring transactions by 60%.

 

Factoring companies provide businesses with the working capital they need to operate and grow their businesses and, because factoring is not a loan, there really are no disadvantages to factoring.

 

 

 

 

 

 

Lansing Factoring Companies Articles

Oil Well Cleaning Owner Interview

 

The oilfield services industry is certainly a booming one these days thanks to a renewed emphasis on searching and drilling for oil on private and state properties. One of the more profitable ventures in this field is not the drilling for oil, but the cleaning of oil and gas wells to keep them operating at full efficiency. Oil and gas drilling is a dirty business and wells will quickly become clogged even with regular maintenance.

 

Jeffrey Fielding is the owner of an oil well cleaning company who works with several drilling companies in providing cleaning and maintenance of oil wells. Over the past couple of years, Jeffrey has managed to grow his business considerably thanks in large part to his perseverance and determination. However, things were really tight when Jeffrey first started up his company and at one point he was faced with a dilemma that he didn't know how to overcome.

 

The following interview with Jeffrey tells how he managed to expand his company at a crucial time thanks to oilfield services factoring. If it wasn't for the presence of factoring companies that worked in his field, Jeffrey might be in a completely different business today.

 

"Hello, Jeffrey. It's good to talk with you and I'm glad you were able to spare the time to share your story with us."

 

Jeffrey Fielding: "Thanks, I'm glad to be here."

 

"Jeffrey, tell us a little about how you got into the oil well cleaning business first as it's something our listeners may not be fully aware of."

 

JF: "No problem, I'll start at the beginning. About ten years ago I joined an oil well crew as a roughneck, working my way up through the business. It was hard work and our crew was usually out in the middle of nowhere, but the money was good and the opportunities kept building for me. I quickly learned the job and was hired by a number of drillers to work their rigs over the next few years during the boom in the oil industry."

 

"Right from the beginning, I took notice the oil well cleaning crews that would work each rig and started talking to the guys who were a part of that business. After a few years it became clear to me that oil well cleaning was really where it was at 'cause the work was really steady and the money was just as good, if not better than what I was making. So, with the money I had saved up along with a couple of partners I opened up an oil well cleaning company of my own."

 

"It certainly sounds like you struck gold so to speak. So tell us how your business started."

 

JF: "It was pretty straightforward as we got our business loan, purchased the equipment and hired a couple of experienced people to help us clean oil wells. We had some pretty good connections and the orders started to pile in, but then we ran into a problem that none of us could even dream of happening. We became victims of our own success."

 

"I don't think I quite understand, could you explain just how that happened?"

 

JF: "Sure, about six months in we suddenly got new drillers who wanted to use our services, but we didn't have the money to expand. We get paid by invoice which can take up to 60 days to see the cash which meant that we trying to pay down our loan, the payroll and the equipment, fuel and other costs and didn't have enough cash on hand to expand. We knew that if we didn't hire new people and buy new equipment that we would miss out on a golden opportunity. However, one of my friends told me about oilfield services factoring companies that could help us out."

 

"What are factoring companies?"

 

JF: "Basically, a factoring company will buy the invoice and get us the cash immediately. We had good credit and our invoices were certainly good as well. By using their services, we were able to get the cash in our hands quickly and pay for new equipment to then expand our business efforts."

 

"It certainly sounds like the factoring companies saved the day for you, but just how do they work?"

 

JF: "Well, it was a pretty simple process. We just filled out a few forms with the information that they requested and then we sold the invoices we had already collected, but had not collected to the factoring company. We got the cash we needed immediately and they collected the invoice."

 

"It certainly sounds pretty straightforward, but why didn't you just get another loan?"

 

JF: "My partners and I went over that and another loan would just be too big a burden. We were already paying off our old loan which was considerable and didn't want to have more debt hanging over our company. By going with the oilfield factoring companies, we didn't owe anyone, anything. We just collected the money that we were owed a lot more quickly."

 

"So, how is business now?"

 

JF: "It's better than ever. By using a factoring company I was able to buy new tubing, cleaning fluids, a new vehicle and other equipment that let us take on the new orders. We were able to expand the business quite a bit and our reputation is such that we work with several drilling companies."

 

"It sounds like a dream come true."

 

JF: "It really does, but I don't know what we would have done if factoring companies didn't exist. We still use them when we need cash for new equipment or products to do our job. It's quick, safe and brings us the money we need to continue our business."Jeffrey's company really benefitted from using oilfield factoring companies that served his industry. There are factoring companies for other types of businesses as well that can take invoices and turn them into quick cash for businesses that need to expand. For Jeffrey and many other small business owners, factoring companies can make the difference in the success of your efforts.

 

 

 

 

 

Lansing Factoring Companies Articles

The Basics of Trucking Factoring

 

Whether you're the owner of a 50-truck fleet or an independent owner/operator, we all know that controlling your cash flow is vitally important to growing your business. Perhaps like many business owners you've become pretty clever at making creative use of your credit cards, because it's certainly preferable to going to your banker and begging for a business Line of Credit! Fortunately, there is another viable option for owner-operator businesses and small trucking fleets. The answer to the age-old cash flow problem is Freight Bill Factoring!

 

If Freight Bill Factoring is an unfamiliar term to you, then here's a brief explanation:

 

Freight Bill Factoring is the simple process of assigning your unpaid freight invoices to a third-party company (factoring company) for an amount that's less than you would receive if you were to bill your customer direct. The bonus of Freight Bill Factoring is that it enables you to get paid almost immediately upon completion of a run, thus giving you access to much-needed cash required for the day-to-day running of your business operations.

 

Here's a step-by-step explanation of how Freight Bill Factoring, or Trucking Factoring, works :

 

Once you've booked a load, you immediately email or fax details about the load, your customer, and your rate confirmation to the factoring company;
The factoring company will quickly respond by advising if that particular customer has been approved for load factoring;
You pull the load;
When the load has been delivered, you email or fax your load-related documents, including the Bills of Lading, to the factoring company;
Within 24 hours the factoring company will make a direct deposit into your Comdata account or your bank account for the amount of approved charges: this could be anywhere between 60 and 90% of your billing;
Once the invoice has been paid by your customer, you'll receive the balance.
It's true that Freight Bill Factoring is not for everyone, but it is an ideal way of accessing the cash you need to provide stability to your trucking business and keep your wheels turning whilst you wait for your customers to pay their accounts.

 

Obviously, the best option for any business is to invoice your customers directly and wait to receive payment, but unfortunately many customers are painfully slow when it comes to paying their invoices. If you're experiencing a cash flow problem, then working with a factoring company could well provide the financial cushion you need to keep your trucks on the road. It's up to you to do your own research and determine whether factoring makes sense for your business. We trust that the information we're providing here will provide you with enough knowledge to help you make a wise decision.

 

The Cost of Freight Bill Factoring

 

As explained above, there's a cost involved with Freight Bill Factoring, and it's up to you as the business owner to determine whether it's worth the cost. The cost of Trucking Factoring can vary from as little as 1.5% up to around 5% of the line haul revenue.

 

You also need to be aware that there could be a number of fees, charges, and other expenses if you employ the services of a Freight Bill Factoring company. Generally, when you've assigned your Bills of Lading to a Trucking Factoring company, you'll receive an immediate advance of between 60 and 90% of the anticipated revenue: of course, this figure will depend upon the factoring company you use. Once your customer has paid their invoice, the balance will be remitted to you.

 

It's also important to note that all Freight Factoring companies are not equal, so here are some key questions a business owner should ask when considering hiring the services of a Trucking Factoring company:

 

Recourse or Non-Recourse: Which Freight Factoring Service Do You Provide?

 

You may not be familiar with these terms, but you need to be, because the ramifications of not understanding these terms could seriously affect the profitability of your business.

 

Recourse Factoring means that, should your customer fail to pay the factoring company, the factoring service can come back to you for reimbursement; while

 

Non-Recourse Factoring means that you have your money whether the invoice does or doesn't get paid.

 

Will You Bill My Customer for All Future Loads or Can Factoring Be Done on a Load-by-Load Basis?

 

Let's say you have a temporary cash shortfall problem that you're trying to resolve by hiring the services of a Freight Factoring company: many businesses require that the factor handle all future collections owed to you by that specific customer. However, depending upon the customer, this may not be the path you wish to take. You should be aware, though, that some factoring companies are very rigid with this requirement.

 

There are Freight Bill Factoring services out there that allow you to choose on a load-by-load basis as to whether you'd like them to handle the collection on your behalf or whether you prefer to deal with the process of billing and payments yourself. And these services generally let you decide whether you want to receive payment when the invoice is actually paid or whether you want immediate payment. This can be very useful for small businesses because it can save a lot of time by allowing you to use the Freight Factoring service as a kind of de-facto billing service.

 

Is There a Price Difference If the Factoring Company Bills a Customer for All Loads Pulled?

 

Some Freight Factoring companies require that all billings originate through them, while others allow you to decide on an invoice-by-invoice basis whether you want the factoring company to do it, or whether you'd prefer to bill your customer yourself. If you choose to use their services on a spot-usage basis and choose not to have a certain invoice factored, you'll probably still have to pay the $15-$20 billing charge. You'd then receive payment once the customer has settled their account.

 

Are Extra Fees Payable for Additional Services?

 

It's not usual for a freight factoring company to automatically pay your customer's invoices: they need assurance that your customer is a reliable, good-paying customer, so they'll typically require a credit check to ensure they'll be paid. Most Freight Factoring companies will arrange for a customer's credit check on your behalf, and this credit check could incur a nominal fee. On the other hand, there are factoring companies out there that are happy to provide you with access to a list of customers that are already pre-approved - these are companies that currently meet the factor's credit requirements. This can be very useful information to a trucking company, particularly if you need to know the credit rating of a prospective customer prior to booking a load.

 

How Much of the Freight Bill Do You Advance; and Do You Require a Deposit?

 

It's very rare that a Freight Factoring service will advance 100% of your freight invoice, and that's just one of the reasons why it's imperative that you take the time to do your own research and find out what your chosen factoring company's policy is. You also need to know if this will change from load to load or if the same policy applies to all your customers and all freight bills. p> 

Regarding deposits, some freight factoring services do require deposits, while others don't. Again, before you finalize any contract with a Trucking Freight Factoring company, be very sure that you know exactly what you're signing up for. p> 

 

 

 

You Can Find More Information at  https://businessfactoring.org
and at www.receivablefunding.net

Call Us Today at: 1-800-986-1854

 

Watch our Factoring Company Video below to see how we work for you.

 

 


 

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