1st Commercial Credit

We Offer Supply Chain Finance Solutions

Over 18 Years in Business

Recent Transactions

invoice factoring for a long haul trucking company dry van

$750,000

Long Haul Trucking Company

invoice factoring for a small fleet trucking

$100,000

Small Fleet Trucking Company

Factoring for Freight Companies

Freight Companies
Freight factoring companies help trucking businesses to manage these issues while sustaining and growing their operations. Learn about key benefits of freight factoring for today’s trucking companies.

Freight hauling is a critical component of the nation’s supply chain, but keeping trucks on the road to retail, wholesale, and other distribution sites is fraught with some unique challenges. As a transportation fleet manager or an owner-operator in the trucking industry, you face fluctuating operating expenses and sluggish payment cycles that can lead to funding shortfalls. Freight factoring companies help trucking businesses to manage these issues while sustaining and growing their operations. Here are some of the key benefits of freight factoring for today’s trucking companies.

Instant Source of Funds for Operating Expenses

To stay competitive in the trucking industry, freight haulers take on loads that must be delivered within strict time constraints. However, freight brokers and direct shippers usually have at least 30 days to pay for the hauling service after the trucking company delivers the load to its destination. This payment arrangement is great for the shippers, but it often leaves truck operators strapped for cash when paying for operating expenses.

Partnering with the right freight factoring company can help you to free up funds for fixed operating expenses such as driver salaries, equipment lease fees, and tolls. Insurance premiums are also big-ticket costs of doing business for truck operators whether you set aside money monthly or annually for the bill. Some variable costs for trucking companies include fuel, tire replacement, and routine maintenance.

Freight factoring companies provide fast cash to meet these expenses. The good ones offer additional financing options to cover items such as insurance and fuel costs. For qualified businesses, factoring companies offer loans for insurance premiums. Truck companies have the option to make payments on those loans by factoring their invoices until the bills are paid in full. Factoring companies also extend fuel lines of credit to their established customers that allow trucking operators to use their cash reserves to pay for other expenses.

Seed Money for Growth Opportunities

Upon delivery of a load, truck operators are known to wait 35 to 50 days for payment of invoices from freight brokers and direct shippers. When trucking companies are short of cash to pay driver salaries and other bills, they must cut back on their operations. In worst-case scenarios, cash-strapped trucking companies park their vehicles altogether until they can afford to make deliveries again. This can have devastating effects on short-term operations and long-term growth strategies for these freight haulers.

Freight rates fluctuate throughout the year. Operating during peak load periods can mean the difference between growing your business and just surviving. By using freight factoring services, you don’t have to wait for payments from shippers to keep hauling cargo during these lucrative time periods. Freight factoring companies buy trucking invoices at competitive rates and deliver cash advances to trucking companies in time to take advantage of the next haul.

Company growth depends on finding and nurturing new customers. With freight factoring services, you can afford to attract new customers with generous invoice payment terms.

Financial Safety Net for Unexpected Expenses and Cash Flow Shortfalls

When you run a trucking company, you learn to expect the unexpected. While your customers only see safe, on-time deliveries of their goods, you regularly cover emergency situations on the fly. Routine maintenance is standard in the trucking industry, but truck accidents happen more often than anyone wants to admit. When you need to replace a truck, you have a few options. Freight factoring services can help you to exercise the options to lease a new vehicle, enter into a lease-purchase agreement, or finance the purchase of a new truck.

Many trucking accidents involve tire issues. According to standard trucking industry estimates, tractor-trailer tires should be replaced after 170,000 to 200,000 miles of use. Replacing one blown-out tire can cost up to $500. Cash advances from invoice factoring can help pay for this type of emergency situation. You can also use the money to replace prematurely worn tires before they cause road hazards.

Quick Funds Processing

Freight factoring is one of the fastest ways to get cash for your trucking company. The service is so popular with freight haulers that market analysts attribute over 30 percent of all invoice factoring transactions to the trucking industry. New technology and streamlined processes allow freight factoring companies to meet the cash flow needs of trucking businesses with unprecedented speed.

Invoice factoring applications are done primarily online. When a trucking company delivers a load, it can upload scanned images of bills of lading and invoices to a factoring company’s invoice processing website. Some factoring companies even offer mobile applications to make the process more convenient for trucking company officers who often work on the go. With online credit checks and payment processing tools in place, many factoring companies are able to deposit cash advances into trucking company accounts within 24 hours.

Hassle-Free Funds Without Strict Bank Loan Requirements

Operating a safe, reliable trucking business is stressful enough without worrying about pulling together mounds of paperwork for a traditional bank loan. When applying for a bank loan, you’ll need to submit several years’ worth of financial statements, inventory documentation, and personal credit information. In most cases, several weeks will pass by before the bank makes a final decision to loan your company the money that it needs to make it through the month.

Freight factoring companies make getting the money that you need when you need it hassle free. You can expect application approvals in as little as 48 hours after submitting verification of your operating authority and proof of insurance to your invoice factoring agent.

Conclusion

Not all invoice factoring companies are the same when it comes to getting cash for your trucking business when you need it. Look for factoring companies that have ample experience turning invoices into cash in the trucking industry. Those that keep up with technological advances and industry trends offer factoring services that better align with the operating models of modern trucking companies.

Factoring Rates at 1.0% to 3.0%

18 Years In business & Over 3,200 Clients

  • Predictable Cash flow
  • No Financials or Setup Fees
  • Low Credit Score Accepted
  • 3 to 5 Day Initial Setup
  • Digital Uploads for BOL's
  • Free Invoicing Software
  • Fuel Credit Card Discounts