What exactly does a factoring company do? Cost?

Factoring is a transaction in which a business sells its accounts receivable, or invoices, to a third party commercial financial company, also known as a “factor.” This is done so that the business can receive cash more quickly than it would by waiting 30 to 60 days for a customer payment.

 

It's best to never learn what one does and don't get hooked up with one. Ever had an old ex girlfriend bleed you dry, then take you to court for some BS reason you can't even fathom....... About the same feeling you get dealing with a factoring company.

 

The main feature of factoring is of course quick funding when you deliver the load but there is also more features and benefit to using a funding partner. Fuel cards, load board, equipment finance, loans, back staff office...just to name a few....pricing hm, well can range anywhere from 1-5%

 

Sounds like a factoring company rep......

 

The op ask a question, not for your opinion .Why do you know so much about factoring if you don't use them.I know I have a friend right.

 

No, employees that used to have trucking companies. They don't now and one of the main reasons for having to shut it down was they started factoring invoices instead of waiting a few weeks on their money.

 

Yea it was all the factoring co.fault all the people you know don't have company's anymore .The op ask a question not for your opinion

 

It really isn't that difficult it's kind of like a pool. Money comes in and goes out but try to keep it at a minimum level. Everyone's level is different. Just in case the day comes someone does a cannon ball in your pool. You want to have plenty of water in it. If someone is cornered into a position where they need to factor, they aren't letting their pool fill up.

 

My opinion is if you can't run you're business for a month or more without factoring then you need to take a closer look at you're spending habits.