Factoring provides a source of consistent funds and healthy cash flow and truckers are partnering with factoring companies in increasing numbers.
What is freight factoring?
Freight invoice factoring is a simple way for owner operators, fleet owners and brokers to sell their unpaid invoices to a factoring company at a small fee. After delivering a load without a factoring partner, truckers may wait 30 to 90 days to receive payment for a load.
How does freight factoring work?
- Deliver the load - Pick up the freight, deliver the freight and have your paperwork signed by the receiver.
- Send paperwork to your factoring partner - Submit the invoice, rate confirmation, and bill of lading to the factoring partner, who verifies load delivery.
- Get paid - The factoring company buys your invoice and pays you up to 98 percent of the invoice, this is known as the advance. It is usually deposited directly to your bank account. Or, if you prefer, it can be applied to your fuel card.
What are the benefits of factoring?
Improving cash flow, growing your trucking business and the peace of mind knowing your factoring partner will pay your invoices in a timely manner for a small fee. All categories of truckers can benefit from factoring from single owner operators to fleets. Also, a good factoring partner generally offers discounts through fuel card programs.
Here's what you should look for in a factoring company...
- How long the company has been in business.
- What digital tools the freight factoring company offers
- How quickly does the factoring company pay their clients?
- What are the fees associated with each payout to the trucker?
About Drive Logistics
Founded in 2016, Jacksonville-based Drive Logistics is a veteran-owned trucking company that provides business support services to trucker owner operators with the passion to run their own trucking business. Drive Logistics is recognized as the premier company for truckers to secure comprehensive business solutions, innovative tools and benefits committed to help its clients make their entrepreneurial dreams a reality. Drive Logistics offers billing, collections, broker negotiation, IT services, back-office support and many other business services to trucking company owners. Drive Logistics operates in the contiguous 48 states and its executive team has over 100 years of combined experience in the trucking industry. For more information, please visit www.drivelogistics.com.
If you have any questions about factoring, you may contact Drive Logistics here.