Owning a small business is the dream of people living in America. Current figures show that there are almost 28 million small businesses operating in the United States. Considering that, many people have found success by owning at operating their own small to medium sized trucking companies. In this post, you’ll learn what transportation factoring and how it benefits your trucking business.
Understanding How Transportation Factoring Works
Industry figures estimate that almost 12 million rail cars, trucks, and locomotives, and vessels that make up the transportation network. That being said, entering into this network by starting a trucking company isn’t without its own unique challenges. Unfortunately, statistics show that nearly 60% of all invoices aren’t paid on time. In turn, this could mean potentially missing out on 60% of your company’s upfront revenue.
Fortunately, transportation factoring can help your business with this problem. Transportation factoring companies help ensure their clients receive payment as soon possible. After your employees deliver their shipments, you submit documentation to a transportation factoring company. Once this happens, you’re able to receive a large amount of cash for this shipment right away. In order to find exact timetables and payment rates, you’ll want to directly contact a small business invoice factoring company. While your business gets to benefit from receiving instant money for services rendered, the transportation factoring company takes care of collecting the actual debt.
Advantages of Working with Freight Factoring Services
Small business invoice factoring helps a wide range of companies. That being said, it’s understandable to want to know why it’s advantageous to partner with a factoring company in your industry. With that in mind, here are three benefits of partnering with a trucking factoring service.
- Less Strict Credit Requirements
It’s often difficult for smaller businesses to establish a proven history of financial trustworthiness. Therefore, you might find it hard to secure lines of credit. If you’re tired of dealing with this major problem, consider invoice factoring. In many cases, transportation factoring is the only option for companies with less than stellar credit histories.
- Growing Your Trucking Company Without Waiting
Your transportation company will often need to cover a lot of costs while bringing items to their clients. You’ll need to ensure that costs associated with payroll, fuel, repairs, and other situations are taken care of. Unfortunately, this becomes almost impossible while waiting for your clients to pay their invoices. However, trucking factoring allows you to receive instant funding which enables you to have a much easier time expanding the growth of your company.
- Working with Partners That Understand Your Business
An important aspect of owning a successful business is choosing the right partners. After all, you wouldn’t want to partner with those who understand nothing about your industry works. However, you won’t have this problem while working with freight factoring companies. These businesses understand the problems that trucking and other types of transportation businesses face. In turn, you’ll always be able to rest assured that you have trustworthy and understand partners on your side.
In closing, it’s wise to learn about transportation factoring and how it benefits a wide range of companies. Owning a small to medium sized transportation might seem difficult, but it doesn’t have to be. If you’re wanting a way to expand the reach of your transportation company, it’s wise to consider invoice factoring and its many benefits.