Factoring Company: which are you using? Who offers the best terms?

As long as the utility is worth the cost of capital, go for it. I think in most cases traditional financing is better, but if you're in hyper growth, don't have access to the desired traditional fiancing, and cognizant of the risks, have at it...

 

And you dont have to run everything you haul trough a factoring company, theres a couple of brokers that I have worked with that want you wait 39 DTP but the rate is pretty good, so I will run them thru the factor get my money and let them wait a month and half to get paid.

 

While I don't think credit cards are wise either it's sure the lesser of two evils. I wouldn't hesitate to get over a rough spot with a little credit. Guess it's really no different than redoing a loan on a truck to rebuild an engine which I've done more than once. I wish everyone luck whichever way you choose.

 

Everyone tells you not to use the factoring bank, which I understand the reason for it but they are not telling you that if you do not use a factoring bank that you will have to spend most of your day chasing around brokers to pay you. I would rather pay the 2.95% fee to my factoring bank and have them deal with that BS. With 6 trucks I don't have time as it is and having to deal with brokers more than I have to would drive me crazy. I use Thunder Funding, they are good in my opinion. Have a good day!

 

"Spend most of the day chasing around Borkers"?

Why would you even be in that predicament in the first place?

Do your due diligence prior to moving any freight.(And I get it, You have 6 trucks to cover daily and it makes it hard to check every Borker thoroughly)... But I can't fathom giving up 3% on invoicing

Let's do the math..... avg of $3,000 per truck per week Minus factoring fees +approx. $600 per week-$2400 per month and $29,000 per Year...

Like I say, I get it.... that $29k could be used to Hire an extra office staff girl to do collections for you PLUS other things that could loosen up hours in your day too. That's the key here..OTHER tasks to free up your time.

 

You make a good point. A lot of brokers that I send invoices to avoid my calls and that's annoying. Yes there is some good ones also but when you are a small company you need to get paid ASAP and not have to call a broker 10 times in 2 weeks just to get paid. I think once/if I do get bigger at that point hiring someone to do that is a good idea, but with a small company or few trucks its really not worth it in my opinion. Oh and good luck finding someone to do this for 29k a year.

 

Oh I get it EMCO.......Here's a few useful tips I find that will get you paid much faster...

Brokers are Funny..They secretly will Grade a carrier on how you present yourself to them,Which in turn can determine how 'fast' you can be paid.

1, Invoicing- Are your invoices designed in a professional manner?(Design of the invoice-Detailing in the invoice) If you use some outdated quickbook invoicing tool with a entry level design..it makes some of these brokers think, "ah this guy don't have much,We'll pay him whenever"

2. POD (proof of delivery) Are you sending out POD's as soon as your drivers bring in their paperwork? get the POD's over to the Brokers ASAP whenever possible(e-mail-fax with a confirmation report)

3. Phone etiquette- This is a HUGE player in the game- When you show Confidence verbally- They will know right from the start your Not a Fool and you don't play around- NEVER.EVER talk to them like you've 'Known them all your life" Yes, Be friendly, But don't show any weaknesses.

4.Communication during the delivery process- Don't "overdue" it with Calls or E-mails.. Show them that you've 'been there" And your Company Knows what there doing

these are very good,Useful tips that can assist you in faster payables......best of Luck to you EMCO.

 

Basically you gotta teach all that the 29k per year person and expect that person to do a good job. Also you gotta train few of those people per year, because they gonna jump the ship as soon as somebody offers them 35k

 

Well sure there is always opportunity for what you state(fairly obvious)...I'd rather pay 30k per year and take my chance with a person working for me directly..Rather than give my earnings to some Factoring institution/Funding house Preying on the less fortunate. Next time you get a chance Check out some of these factoring companies on D&B,

 

I disagree. I've only had one maybe two loads not get paid in the last 12 yrs. if you use a factoring outfit and they don't get paid, they deduct it from you down the road plus some fee I'm sure so it's a lose lose situation.