Factoring your invoices can be a great help to your business. To make things easier for you to understand, factoring is a process by which a company buys your invoices. After that, it pays you a certain percentage of that invoice fast, thing that allows you to use the advanced funds to take care of the demands and the expenses of your company. This article is going to show you what you should be looking at when it comes to a factoring company.
You should always keep in mind that not all the factoring companies do the same thing. This is why you need to make sure you’ve chosen one with reputable and ethical past that can understand how your business work and that can meet your business’ needs.
Only the invoices you choose can be factored? It’s all about flexibility
There are some factoring company for truckers that ask for a certain number of invoices or a minimum volume for each and every month. Make sure you ask about it at first, because there may be some cases in which you’ll only want to factor your slow paying customers. Pick a factory company that will allow you to factor the invoices you wish to factor – it’s all about flexibility.
Does the company really understand your business? It’s all about industry knowledge
A freight factoring company should be able to understand the demands that your business asks for when it comes to the trucking industry. It should recognize the ins and outs of this industry and always be able to offer solutions and even discount programs for your needs.
Does the factory company offer free fuel cards? It’s all about saving money
We all know that when it comes to fuel, we’re talking about big money – it’s possibly what costs most in trucking. Your company should give you a free fuel card. This way, you’ll be able to save the money every time you fill the truck up.
Is the factory company always going to be there for you? It’s all about customer service
When you have to choose a freight factoring company, it’s crucial that you pick one that will offer their online account access 24\24 – this way you’ll see exactly where you stand in the factoring process. If they don’t give you online access to your account, you should rethink your choice, since they probably lack the imperative tools to support your ideas. You should ask the company from the very start how are you going to access your account, and also about their program. You don’t work in the evening or at the weekend, so they’re probably not, either.
Is there a Non-Recourse Agreement? It’s all about which one they offer
2 basic types of accounts receivable factoring are in the picture: recourse and non-recourse. If you factor with recourse – the clients must buy back the invoice from the factoring company if that invoice is not paid in a certain number of days. Non-recourse factoring means that the factoring company acquires the risks of not paying an invoice. That’s why it’s important to know this piece of information.