Love's Factoring?

I factor with Transport Clearings East in Charlotte. I love it.

I factor with Transport Clearings East in Charlotte. I love it. They charge as of this post 1.91% and a $25 a month EFT charge ( they say that is what Bank of America charges them per acct.).
They pay a dividend at the end of every year. They charge all companies the same rate no matter how small you are.

 

Yes 12k a year that is what I figured it would cost. You would be then make about 30k a month.
I could see using a factoring company when a person just starts so you can get cash flow moving.
I have had other businesses that clients take 90 days to pay and that is tough in the bring but once the pay ball starts rolling its good.
I see a few boards that charge a monthly fee but most just want your mc number

 

I don't really get the factoring.

When you first get started you have to get to where the money is coming in but if you've been in business for a while you shouldn't be struggling with that.

Not to mention you should have enough when you start that you don't need any of that.

Even if you have some Brokers set up on a quick pay and some to pay you in 30 days I just don't see the need for the factoring.

 

Hmmm my bank offers factoring, 2% I believe. I am not sure I don’t use factoring. but 3.75 Loves is higher than a kite.

 

Sometimes even companies like CHR take up to 90 days to pay. If you use quick pay through them it's 3%( they become the factoring company )
TQL is similar and some of the actual brokers charge up to 5⅝. Factoring really helped me personally get a foot hold on my own, and they help with my accounting on the receivables side. I don't have to constantly watch my acct and see what was paid this week.

I agree that you should have enough to get by in a pinch at the start ,but, without starting with $50000 in the bank after you've already started, you could end up like me and have a failure in the truck that was too much to handle. Luckily I was factoring and it did help me keep up with fuel and other bills.

It ain't for everyone though, but, starting out and doing everything yourself, it sure can be a lifeline.

Your mileage may vary though

 

Phoenix capital

 

I have been through 2 awful factoring company's, Financial Carriers and E capital.

Factoring company's target new MC numbers issued with a sales call from a representative.
It's easy to get behind with money in this business as each day you'll spend $300-$800 in parts, repairs, and fuel as each payment paid for shipments delivered each day is 7 to 45 days later. The cash flow is out of balance for income to expenses.

Lastly I would like EVERYONE to recognize that trucking is the only business in the world that does NOT get paid for transportation services that have been completed.

Every transportation business in the world gets paid before service begins or at the time of delivery... UPS, Fed-EX, Trains, Plains, Boats, Amazon, Pizza, Postal Mail, Taxi, Instacart, Limo, Drugs, Flowers, Bus, Ride Share,
Except Trucking...

 

I do not recommend using a factoring company. Get a LOC.
When I started using a factor during the 2010 recession. Even with my LOC, I needed the A/R now. Unforeseen expenses not related to my trucking caught me under funded.

The trucking portion of my business has always been profitable.

 

Not being condescending here - there may be some who don’t know that LOC means a Line Of Credit with a bank.

Banks will usually lend between 50-80% of your receivables on a line of credit and the cost of borrowing is much less with a LOC than through factoring.

 

A "line of credit" (LOC) is a loan that can be attached to any asset or just a signature. Depends on your lending institution. I have my truck and trailer attached to the LOC.

My LOC has always been cheaper than factoring. Currently at 5.99%. It varies with the prime rate.