When do brokers pay?

This is what most moaners do not realize. Banks will buy these 30-60-90 day if payee & all involved have an established history ~ it is "will happen" rather than fast-tracking that determines what if any interest a bank may have on such matters.

Anyone who can spend $35,000-$100,000 to be an O/O really should be able to figure this out. Those who have to have 7-10 day fulfillment to keep afloat need to go back to burger-flippin until they get a taste of the real world.

My financial controller tells me these people make enough to float the operation, there just is not the discipline there that needs to be.

 

You haven't found one yet. Integrity is a rare trait in them but there are some out there who have it.

 

plan to cover your fixed expenses at the least for 60 days.

Plan to cover the variable expenses you rack up in those 60 days as well.



One credit reporting company that was suggested to me for working with trucking companies.
http://www.credco.com/

 

And this is the reason you will add to the failed statistics. If you can't wait at all for money then I suggest you stay a company driver. Just because you use quickpay does not mean you'll have a check in your hand within 48 hours. Oh yeah and for all the brokers that require the original bills you will have to mail that. Add a few days onto your quickpay. Also the cost of mailing it in delivery confirmed of course. That's another 4 dollars. Not too mention the cost of envelopes. So you see your 5% attitude of I'll just pay it adds up to more than 5%. Real quick. Also the standard of billing and doing business is a 30 day cycle. So best I can suggest is get used to it or go broke and get out. Just an FYI. I ran a steady run for a one month time period. I only took a quick pay on the load going out. The rate was 1.9%. After one month and roughly 8 loads or so I could have put 150 gallons in my tank. Do the math. If it doesn't make dollars in don't make sense.

 

More and more brokers are going to email, faxes, Transflow and direct upload to their computer system rather than having to mail or over night them. Some factors are using the same system. Others may use Trip Pak. With factors they sometimes furnish the envelopes as part of their fees. Some no longer require the paper originals. As a carrier, you need to find out about these things before doing business with any of them. I like to know exactly what to expect before I even put the load on my truck. Sometimes, there is a small charge to use Transflow. I know of a couple of brokers that charge about $2 per load. That is a small price to pay to know that your load information is at the brokers within minutes. There is no chance that the bills can be lost in the mail. I don't mind paying 1-2% to get my money in a couple of days. It is common in many industries to offer cash discounts if the customer pays in 7-10 days rather than taking 30 days. With one company that I was involved some years ago, we used 2% 10 net 30 days. We offered the same discount if the customer prepaid. It increased our cash flow considerably. We collected over 30% of our money either up front or within 10 days. I think that if you can't give up 1-2% to get your money early then you are not charging enough for your service or products. Of course, if you can wait to get your money you can put a considerable money in your pocket during the course of a year.

 

If you go with quick pay then you will be on the program for all loads hauled for that broker until you cancel it. You could use quick pay with one broker and not on another. You could also use a factor. Some factors have minimum revenue amounts that they require each month. Others require that you factor ALL of your loads with them. Then there are those that will allow you to only factor some of your receivables. However, most will want you to factor all loads from a broker once you start until you decide to no longer factor that broker or shipper. You will need a release letter from the factor if you decide to no longer factor the broker. Whether you use a factor or do quick pay, you will need to discount the freight bill in order to get your money early. And you will be committed to quick pay or factoring until you cancel.