Category Archives: Freight Bill Factoring

Trucking Technology Trends with Factoring

There is an abundance of technological solutions trucking companies may use to improve driving safety, improve the overall day-to-day driving experience, and help manage the business more efficiently. However, the money to fund these resources may be in a shorter supply. When your trucking business is just starting out or hits the slow period, you may not have the ideal technological resources to run your business as efficiently as you would like. So how can you compete with other trucking companies that offer more comforts and safety on the job? If you’re losing drivers faster than you’re receiving payment from your customers, partnering with a factoring company will get you ahold of your money faster so you can make necessary purchases to help your business grow and improve. In this article, we discuss how using invoice factoring and cash advances may provide the opportunity to invest in the latest trucking technology earlier than you ever could have anticipated.

Why Do Companies Use Factoring?

Whether your trucking company is new or has a reoccurring cash flow issue, invoice factoring can help. Companies commonly use factoring to cover their business expenses when awaiting payment from invoices—the trucking industry, in particular, deals with lots of logistical challenges. To be in a position best able to tackle the issues, sometimes immediate cash flow is needed.

Get Cash Immediately – The turn-around time for cash advances using factoring is often less than 24 hours. Unlike traditional financing, factoring eliminates the time spent filling out paperwork and awaiting loan approval, letting you focus on taking care of your business.

Unlimited Capital – There are no restrictions for how much or how frequently you get cash advances. Plus, you can simply get your money whenever the need arises, so you’re not locked into any long-term financing contract.

Business Growth – When you can get your money ahead of time, you can immediately address your business’ needs or issues. This means you can add more drivers and trucks to your fleet, while also addressing your drivers’ concerns and wants. Factoring allows you to finally take the next step in your business’ evolution by investing in technology to improve your operations.

Trucking Technology Trends to Look For

Curious about what kind of technology you may be missing out on? Staying updated with the latest technology will help improve driver retention. These types of advances allow truckers to stay on the job longer. By keeping truckers safe with cutting-edge technology, you may be able to attract new drivers who prefer a safer work environment over more traditional jobs in other industries. We list a few popular trucking technology trends below.

Dynamic Routing – Advanced GPS systems get as close as possible to providing you live traffic updates, automatically rerouting you when a shorter route is found based on live weather conditions, construction detours, or traffic accident information. You will save your business money by cutting down on gas costs and wear on the car, and have your drivers avoid hazardous or headache-inducing driving situations.

Safety Features – Unfortunately, heavy trucks attribute to plenty of vehicle accidents each year. Your drivers are likely aware of this risk and will look for reassuring measures to be made to assure their safety. Today, collision mitigation technology usually comes standard in most new trucks, but if you’re operating with an older fleet, you may want to find systems that can retrofit onto older trucks. In many instances, the passenger vehicle is actually the one responsible for accidents involving trucks, so finding an advanced system that uses sensing technology can avoid crashes by automatically taking emergency actions when needed. Having these features will prove you consider your employee’s safety as your top priority.

Freight Tracking – Keep track of your trailers with GPS transponders and tracking systems. Protect your assets from theft or alert your drivers when they are driving through high-theft areas. Not only can you track trailers geographically, but you can use software to track valuable information such as maintenance records, so you will never need to guess when a trailer is due for service. You can also keep tabs on how trailers are being used, which is especially handy if you rent them out. This way, you will know how long trailers are idle or how much is being transported inside at all times.

Transportation Factoring Software

Not only does trucking technology exist to improve the conditions of your business, but you can also use transportation factoring software to help manage your finances as well. Ask your factoring company about methods of tracking the status of factored invoices, wiring funds securely, and integrating with accounting software you may use. Factoring should seamlessly flow into your current financial structures, and technology can help with this as well!

Advanced Commercial Capital: Risk-Free Debt Factoring

With Advanced Commercial Capital, your trucking business assumes very few risks! Because of the unique nature of our non-recourse freight factoring service, there are no consequences to you if your clients fail to pay their invoices. We also do not require any long-term contracts and do not charge termination fees.

Additionally, we offer:

• Fast and flexible funding options, paying you in as little as one hour for your freight bills

• Strong relationships that foster your success

• And valuable benefits that save you both time and money, from our free fuel discount card program to free credit checks

All of these are just some of the reasons why our clients choose to stay with us for the long haul.

Advanced Commercial Capital can help your trucking company succeed in ways you never thought were possible.

Talk with our team to learn more about how non-recourse debt factoring works by giving us a call at 855.465.4655 or reaching out via our online contact form. We look forward to offering you the easiest and smartest way to factor your freight bills and get the cash you need, without any surprises.

Benefits of Transportation Factoring

The trucking industry employs millions of people and transports trillions of dollars of products every year. Many of us rely heavily on the work transportation companies provide. Without it, the convenience we have come to expect from product deliveries would create a big dent in production to businesses and people’s lives everywhere. Many people don’t know much about cash flow issues trucking companies often face despite making such a significant impact. Due to the importance of transporting goods, transportation companies need cash advances to cover expenses while waiting for invoice payments, called factoring. Factoring lets the trucking industry experience tons of benefits to help their companies grow and focus on what’s important. Read on for more on several different benefits of transportation factoring.

What is Invoice Factoring?

Factoring works differently from bank loans in many ways. Factoring companies buy invoices from your business, so you get your cash upfront right away. The factoring company, in turn, collects the invoice once paid by the client and claims a small percentage. Businesses starting with low cash flow use factoring companies to help pay for necessary expenditures while waiting for payments from their customers. Companies that also experience slow business during certain times of the year or companies dealing with exponential growth can also take advantage of factoring where an advance is needed.

You are not borrowing from anyone, taking out a loan, or putting yourself into any debt with factoring. Instead, you are simply given your own money in advance. Approval is given much quicker than a bank since there are no contracts or debts involved. This way, cash is given quickly, usually within a day or two, so you can take care of important expenses almost immediately.

Transportation Factoring Benefits

Due to the importance of the transportation industry, seeing the benefits to financing options such as factoring is pivotal to some trucking companies staying afloat. For those struggling with cash flow issues, review some of the benefits of transportation factoring to see how your trucking company can expand with the help of cash advances on your invoices!

Get Cash Immediately – Perhaps the greatest benefit to factoring is the immediate payout. Unlike traditional financing, where you fill out loan paperwork and await approval, factoring lets you get the cash you need in less than 24 hours.
Unlimited Capital – Instead of long-term financing, you can get cash advances as the need arrives, regardless of what it is, and you can do this as often as needed.

Protection from Bad Credit – Factoring allows companies, especially ones just starting out, to get the cash flow they need without any limitations based on bad credit or poor credit history. Non-recourse factoring also protects you from ruining your credit by covering the loss if your invoice cannot be paid and your company still gets paid.

More Flexibility – When you use a factoring company, your bookkeeping is covered so you can focus your time elsewhere! You won’t accrue any additional debt while using factoring, so you’re not adding onto your money going out while still getting your money quicker. With this flexibility, you can put more time back into your business or maintain a better work-life balance.

Simple Process – With factoring, you won’t have any hidden fees. Your factoring company will charge a flat fate for each invoice purchased but won’t charge you for applications, credit checks, or account management. Factoring tends to be straightforward, so you don’t have to worry about the logistics of a long-term contract.

Business Growth – Your immediate cash flow allows you to take on more loads than you otherwise could. Getting cash when you need it means adding on more drivers, purchasing new trucks, and paying for extra gas. Before you know it, your business will grow faster than you imagined possible without the help of cash advances.

Advanced Commercial Capital: Risk-Free Debt Factoring

Additionally, we offer:

• Fast and flexible funding options, paying you in as little as one hour for your freight bills

• Strong relationships that foster your success

• And valuable benefits that save you both time and money, from our free fuel discount card program to free credit checks

These are just a few of the reasons why our clients choose to stay with us for the long haul.

Advanced Commercial Capital can help your trucking company succeed in ways you never thought were possible.

5 Ways to Improve Truck Driver Retention

Fleet managers often struggle with drivers leaving, whether it’s for a different trucking company, or leaving the industry itself. New drivers tend to quit their careers after just one year as a result of a variety of different factors the driver may not have anticipated about the job. You will have more success with keeping drivers if they feel safe, healthy, and appreciated. You must consider what the long hours behind the wheel do to someone’s mental and physical health and find opportunities to improve working conditions to keep drivers in the industry and with your company. Ready to find out a few ways your trucking company can avoid driver shortages? We discuss some helpful tips on how to improve driver retention below.

1.)Open & Honest Communication

Nothing is more valuable than open and frequent communication, especially right from the start of employment. Be open and honest about a driver’s experience during the recruitment stage; your prospective employees will appreciate the transparency. Don’t forget to mention how your company will help improve day-to-day life on the job. Continue leaving an open line of communication to create strong relationships with drivers and create incentivizing programs for drivers who put in lots of miles to show your appreciation. Ask for feedback from employees to see where you can improve. Keeping this level of rapport will make it more likely for your employees to share their positive experiences with other drivers from other companies, creating an effective opportunity for recruiting you may not have considered.

2.)Ensure Propper Training

Recruiting is only part of the battle since the bigger concern is with keeping your drivers. Having good communication includes training your drivers whenever necessary, and this is often a full-time job. Make sure your employees are set up for success by ensuring they are familiar with the technology you use, such as electronic logging devices and dashcams. You can potentially offer a mentorship program to partner up a new driver with an experienced one. This is an easy way to get new employees hands-on experience where they can ask any questions in the moment while giving your drivers a chance to feel less isolated. Outside of properly operating technology, the onboarding period can be used to educate your trainees on company policies.

3.) Provide Updated Technology

Another common reason drivers leave the profession is due to a lack of updated technology and equipment. Most importantly, drivers need reliable vehicles. If the truck they drive constantly breaks down or needs repairs, the driver will be rightfully frustrated and inconvenienced, especially if breakdowns are happening in undesirable weather conditions. This is incredibly important for safety, so it is vital this is never overlooked as drivers who feel unsafe will likely leave at the first sign of danger. Even though safety should be prioritized, it doesn’t mean you should ignore comfort as well. Investing in high-quality equipment from heated seats to advanced navigation systems will make your drivers feel more at ease.

4.) Consider Employee Working Conditions

It’s sometimes easy to forget about the extremely sedentary life of a truck driver, so showing some empathy and implementing programs to aim for a healthier lifestyle will go a long way in the eyes of your employees. Make sure you offer a strong health insurance package in your benefits, and it doesn’t hurt to add different health programs. Many fleets are focused on prioritizing employee health and offer incentives such as gyms, nutritional programs, and free screenings. It’s vital for drivers to find ways to engage physically while on the road and finding ways to address concerns will make you stand out and decrease the chances of your new employees souring to the career. You can also check for trucks that come with systems that help with working out while driving, like resistance bands.

5.) Payroll Factoring

If your company uses payroll or invoice factoring, you assure your employees they will receive their paychecks on time no matter the circumstances of your business or the trucking industry. There are numerous expenses to juggle at a trucking company, and sometimes invoices for freights delivered aren’t paid on time, but employees still depend on getting paid at the same time every payday. Make sure you can offer your employees financial security no matter what happens.
Additional benefits from payroll factoring that could be helpful in retention rates include avoiding layoffs and preserving savings. Since factoring allows you to get advances, you can prevent pay cuts or letting go of drivers, creating a more motivated and happier workforce.

Advanced Commercial Capital: An Industry Resource

Advanced Commercial Capital is here to help the freight industry continue to grow with confidence. We’re in the business of helping your business grow through fair and honest invoice factoring. We protect our clients from unpaid freight invoices due to fraud, bankruptcy, or delinquency, without any surprises. To learn more or get in touch with our team, call our office at 855.465.4655 or fill out our online contact form today.

If you have a business with employees, then yes, payroll factoring will be beneficial for you, your employees, and the overall success of your business. Advanced Commercial Capital understands the strain that owning a trucking business with unpaid invoices can create, which is why we offer non-recourse freight factoring services.

Freight Invoice Factoring

Freight bills can oftentimes take up to two months to be paid out, creating a significant delay for trucking companies from the time they deliver a truckload to the time they are paid for that delivery. For trucking companies who are trying to get established or expand their operations and need money sooner rather than later this delay in payment can pose problems. One method available to trucking companies to address this issue is freight invoice factoring.

Invoice factoring allows trucking companies to immediately receive payment from unpaid invoices. Invoice factoring companies provide trucking companies quick payment on their unpaid invoices, in exchange for a small fee. The trucking company can then use that money for whatever purposes they need, such as covering payroll, taking on more loads, or expanding their business.

How Does Invoice Factoring Work?

Invoice factoring is simple and easy to utilize. Most invoice factoring plans follow the same basic outline. First, the trucking company delivers the load to their customer as they normally would. The trucking company then sends the freight bill to the customer and submits a copy of the freight bill to the invoice factoring company. The invoice factoring company will then send you the advance by money wire or direct deposit. And finally, your client pays the invoice amount directly to the invoice factoring company.

How Can Invoice Factoring Help a Trucking Business?

The most obvious method in which invoice factoring can help your trucking business is by providing you with cash from the loads you deliver faster. This allows you to ensure you have sufficient funds on hand to cover costs such as fuel, vehicle maintenance and repair, containers, drivers’ payroll, licensing fees, and insurance expenses. Quicker payments also help improve cash flow and allow your business to operate in a more efficient manner.

Another major benefit of invoice factoring is the ability to allow your business to grow. Whether you are looking to expand your fleet, take on additional loads, hire more drivers, or invest in additional marketing and promotional work, your trucking company requires cash. When you have to constantly wait for payment from loads already delivered it can be difficult to save up the capital necessary to expand.

You may also find yourself stuck in a cycle of waiting for payment, then having to use that payment once it comes in to fund future loads. This cycle is preventing you from ever accumulating the capital necessary to grow your business. Utilizing invoice factoring services helps you get the money on hand to achieve your business goals.

Additionally, emergencies can’t wait. Every business experiences some sort of unexpected expense at some point. If you haven’t had the opportunity to save sufficient funds your trucking company may find itself in a bind. Invoice factoring can help you get the money you need when an unexpected cost comes up.

Why You Should Use an Invoice Factoring Company

First, as discussed at length, invoice factoring provides you with immediate cash flow. Additionally, invoice factoring allows you to get immediate funding even if your trucking business has bad or no credit. Invoice factoring is essentially an advance of the money your client already owes you, as opposed to a loan that is not associated with a guaranteed cash flow.

In addition, your eligibility for an invoice factoring plan is not heavily influenced by your company’s credit history (or lack thereof). In fact, it is likely that your client’s credit history may have a greater impact on your eligibility for an invoice factoring plan than your own credit report.

Invoice factoring also saves your company time and stress associated with collections. Once you have engaged in an invoice factoring plan it is as if you assign the associated invoice to the invoice factoring company. Thus, the invoice factoring company then handles the general accounting responsibilities associated with that invoice, such as collections and accounts receivable. These are major responsibilities (and potential headaches) that you no longer have to worry about, freeing up your time to focus on other tasks.

Invoice factoring companies also provide you with a great deal of flexibility. Invoice factoring plans are generally done on an invoice-by-invoice basis, therefore, there are no long-term contracts involved. You can decide how many invoices you would like to submit to the invoice factoring company. You decide whether to use invoice factoring as a one-time solution for a quick payout or you may plan to use invoice factoring regularly to simply speed up the payment process.

Another benefit of invoice factoring is that it provides lower associated costs than traditional financing. Asset-based loans or lines of credit have an associated timeline of when you need to pay back the money associated with the loan. These forms of financing also come with interest rates that require you to pay an increased premium the longer it takes to repay the loan. In contrast, with invoice factoring, there is one fee associated with the plan which is paid upfront.

Invoice factoring companies often provide additional benefits to their clients, such as fuel card programs. These fuel cards allow you to load money onto the card to pay for fuel and often provide savings options at designated fueling stations. The invoice factoring company may also provide the option to receive a fuel advance once an invoice has been booked. These programs make it easier for trucking companies to track fuel costs and provide money-saving opportunities.

As you can see invoice factoring provides many benefits beyond simply paying a freight bill faster than the typical client. The next time your trucking company is in need of cash or requires a quicker payment consider an invoice factoring service.
Fill out our contact form, or call us at 855.465.4655 if you’d like to have a conversation about how our freight factoring can be beneficial to your trucking business. We look forward to hearing from you and helping you succeed.

How Does Debt Factoring Improve Cash Flow?

Cash flow is an ever-pressing matter for businesses. Payroll, taxes, operations, inventory, profits, and repairs depend on a healthy inflow and outflow of money from a company.

Unfortunately, maintaining a steady, positive cash flow is not always possible. Many industries, such as transportation, rely on the timeliness of their customers to fulfill invoices – and customers are not always prompt to pay. When invoices fall behind, and a company’s liquid assets begin diminishing, factoring is often considered.

Why do companies use factoring? Are there specific scenarios when factoring is a safe, healthy option for a faltering organization? In short, yes! In the content below, we define factoring and discuss three common circumstances that benefit from the unique financing solution.

How Does Factoring Work?

In the simplest terms, factoring is the process of purchasing unpaid invoices.

Traditional factoring includes a factor – such as our company – purchasing an unpaid invoice from a transportation company, putting cash in the hands of that company immediately. Once the customer pays the invoice, that money is given to us.

Many trucking companies wonder if they are liable to pay the invoice in the event that the customer never pays it. It depends! There are two main kinds of factoring, recourse and non-recourse, and both address this issue differently.

Recourse factoring places liability to repay the invoice in the hands of the trucking company. Non-recourse factoring assumes the responsibility of the invoice entirely. Thus, if the customer never pays back, the non-recourse factor takes the hit.

1. Factoring to Invest

Sometimes, the perfect investment opportunity appears out of thin air – right when your company does not have the financial freedom to jump on it. In other scenarios, investment opportunities are more deliberate. Perhaps you need to purchase a new fleet of vehicles or hire new employees.

Regardless of the venture, investments are designed to produce exponential growth in the future. However, they require a lump sum of money.

Small businesses and startups without a large customer base or steady cash flow often face this challenge: one must spend money to make money. When an opportunity presents itself, but your company is waiting on invoices to be paid, factoring is an immediate, safe solution.

2. Factoring to Repair

The importance of commercial truck maintenance cannot be overstated. Your fleet of trucks is crucial to a thriving company, and preventative maintenance plays a significant role in business growth and resource preservation.

Logistics companies often look to factoring to increase cash flow for truck maintenance. The truck driver can perform some maintenance before he or she begins transport. Other maintenance requires a professional. When something breaks down, a repair person should be alerted and hired to make necessary repairs.

Why would a transportation company require factoring to pay for repairs? Can truck repair wait for a brighter financial future? Most often, the answer is no. Truck maintenance should not be delayed.

We often list five arguments for the importance of truck maintenance:

– Fewer breakdowns. Proactive maintenance will help reduce the number of unexpected breakdowns – dramatically. When a truck breaks down, shipments fall behind and jobs are delayed. Ultimately, spending money for a repair will save on future disruptions.

– Fewer accidents. Fewer breakdowns mean fewer accidents. Working headlights, working brakes, etc. promote driver safety. When truckers are safe, other vehicle drivers are protected. The well-being of your employees is worth the investment of truck maintenance.

– Operational optimization. Maintained trucks work well! A fleet that is taken care of should operate at optimal functionality, lowering fuel expenses and lengthening the lifetime of your trucks.

– Happy customers. Smooth shipments, without unexpected breakdowns, often result in satisfied customers. Satisfied customers are often repeat customers.

– Legal requirements. Last, but certainly not least, the law requires commercial trucks to meet proper road safety standards. When a vehicle in your fleet needs to take a Commercial Vehicle Road Worthiness Test (CRVT), maintained trucks are likely to pass immediately.

3. Factoring for Payroll

Are you falling behind on payroll? Payroll factoring is an excellent resource for companies that care about the wellbeing of their employees but are experiencing an unexpected cash flow shortage. This can be all too familiar for businesses with many outstanding invoices.

Factoring as a Bank Loan Alternative: 3 Benefits

In the three scenarios explored above, a traditional bank loan could provide the funds needed to address investments, truck maintenance and repair, in payroll difficulties. However, some logistics companies do not qualify for traditional bank loans. Why? Qualifying for a bank loan often requires several qualifications, including excellent credit and experience. Some transportation companies simply do not have those two qualifications. Perhaps you have poor credit or have just started your business.

Additionally, factoring can serve as a traditional bank little alternative when a company needs cash flow fast. Traditional bank loans often take time to process. Factoring is fast. Some factoring companies can begin an agreement within a few days of application.

Finally, when you take a loan from the bank, you have to pay the bank back! Thus a traditional loan builds debt. For many transportation companies, debt should be avoided whenever possible. Factoring is a debt-free financing option.

Advanced Commercial Capital: Factors Who Care

In the modern-day, finding a financial organization that cares completely about its customers can be difficult. At Advanced Commercial Capital, we break this mold. We aim to serve our customers in every area.

How do we show this? Firstly, we offer non-recourse factoring services, meaning we assume the responsibility of our customers’ invoices – completely. Secondly, we do not require long-term contracts. Our goal is YOUR good, and we aim to demonstrate our value consistently.

If you are interested in discovering how factoring could impact the health of your transportation company, we would love to get in touch. Reach out to a team member at 855-465-4655 or complete our online contact form. We look forward to starting a conversation!

What is Factoring?

Most businesses have experienced the frightening pressure of withering cash flow. Whether unexpected expenses appeared, your customers are refusing to pay, or a conglomeration of both circumstances, a multitude of situations can stunt cash flow. Of course, a business can only scrape by from reserves for so long – eventually cash flow is necessary to keep the business alive.

Sometimes, these frightening times coincide with growth opportunities! What should you do if you don’t have the capital to jump on expansion prospects (let alone pay for an equipment repair)? For many companies, financing is the best option. In the logistics industry, freight factoring is a common option.

In the content below, we define factoring and compare factoring with both forfaiting and traditional bank financing, offering insight into which is best for the long-term success of your business.

What is Factoring?

Factoring at its simplest definition is a method of financing, also known as accounts receivable financing or invoice factoring.

Trucking companies often approach freight factoring organizations with multiple unpaid invoices and cash flow needs. When a trucking company approaches the factoring organization, the factor will often purchase unpaid invoices from the company at a discounted rate. The factor will then pursue the client who needs to pay the invoice. Once the invoice is paid, the factor receives the money. Because the invoice was purchased at a discounted rate, the freight factor will come out net positive.

Freight factoring also benefits the trucking company. Waiting for customers to pay invoices can strangle cash flow, inhibiting companies from hiring drivers, repairing trucks, or taking advantage of growth opportunities. Factoring provides the company with immediate cash flow.

Unlike a traditional bank loan, factoring financing turnaround is extremely fast. Factoring companies choose to work with trucking organizations based on the credit history of the company’s clients, not on the credit history of the company itself. This allows for fast financing and higher acceptance rates. Using a factor provides quick cash access – even when banks aren’t willing to lend.

Recourse Factoring vs Non-Recourse Factoring

There are two distinct factoring methods, and both are important to understand when looking for the best factoring company for your needs: recourse factoring and non-recourse factoring.

Recourse factoring puts the responsibility of paying the invoices into the hands of the trucking company. For example, if the factor purchases three invoices and your customer does not pay them, you are responsible for fulfilling that debt. For leverage, the factor will often accept a deposit and hold it until the invoice is paid.

Alternatively, non-recourse factoring puts the responsibility of fulfilling the invoice into the hands of the factor. Once the factor purchases your invoice – typically at a discounted rate – the factor takes responsibility.

Even if the client does not pay, you are not liable for paying the factor or purchasing the invoice back. As you may assume, trucking companies often prefer this method! Non-recourse factoring is safe.

Factoring vs Other Financing Methods

Factoring vs Forfaiting

Forfaiting is another method of export financing. One small business resource writes: in the forfaiting scenario the “export sells its claim on medium and long-term trade receivables to a forfeiter at a discounted rate to receive fast access to cash.”

Because the trade receivables are sold at a discounted rate, the forfeit does not demand a reserve. The responsibility to pay the receivable is not on the importer. In this aspect, forfaiting resembles non-recourse factoring.

If both methods follow similar functions, how are they different?

Factoring and forfaiting have one major difference: factoring can be applied to international and domestic trade while forfaiting only applies to international trade.

Three additional distinctions between both financing methods include:

1. Timing: While factoring is typically applied to short-term accounts receivables, forfaiting involves long-term accounts.
2. Type of Goods: Factoring applies to any variety of normal goods; forfaiting applies to capital goods.
3. Process: Though both financing methods provide companies with fast cash, the processes differ slightly. As discussed earlier, factoring involves the factor of purchasing unpaid invoices from trucking companies at a discounted rate. In contrast, forfaiting involves the forfeiter purchasing rights of trade receivables from an exporter.

Factoring vs Traditional Bank Financing

A traditional bank loan works well for certain companies. However, for those who need cash fast without accruing additional debt, factoring is often the better option.

The lending market is simply not as fast or acceptant as factoring companies. If your trucking company does get approved, the loan is set and may not be enough to ease your financial strain. Additionally, you will eventually have to repay that debt. Factoring allows companies cash flow without strings attached – if you have an invoice to sell, you can earn immediate cash.

Advanced Commercial Capital: Freight Factoring Resource

Need a cash flow boost? At Advanced Commercial Capital, our non-recourse freight factoring service is as-needed and commitment-free. We give our customers zero unpleasant surprises, and therefore, we are the industry leader in factoring for trucking companies.

With over 100 years of combined experience, our team of financial experts has helped hundreds of struggling trucking companies with cash flow needs. We are ready to help your company succeed too.

Contact us for a freight factoring quote today! Give our team a call at 855-465-4655 or complete our online contact form.

What is Factoring in Business?

what is factoring in business
Even when your business gets everything done on time, sometimes the favor isn’t returned. When starting a new business, you put forth the effort to complete any measures that set you up for success, rewarding you with your first customers. However, in the business-to-business industry, there are some things that are beyond your control. B2B companies rely on another business’ ability to pay their invoice on time so you can continue to pay for the things your business needs to stay afloat. Even when you provide exceptional, timely services or delivery of products, you may find the delivery of money isn’t as punctual. This is where factoring comes in. Understanding factoring in business might make all the difference when it comes to getting your business off the ground. Read more to find out what factoring is and how it can help your new or growing business.

What is Invoice Factoring?

Factoring works differently from bank loans in many ways. Factoring companies buy invoices from your business, so you get your cash upfront right away. The factoring company in turn collects the invoice once paid by the client and claims a small percentage. Businesses starting out with low cash flow use factoring companies to help pay for necessary expenditures while waiting for payments from their customers. Companies that also experience slow business during certain times of the year, or companies dealing with exponential growth can also take advantage of factoring where an advance is needed.

With factoring, you are not borrowing from anyone, taking out a loan, or putting yourself into any debt. Instead, you are simply given your own money in advance. Approval is given much quicker than a bank since there are no contracts or debts involved. This way cash is given quickly, usually within a day or two so you can take care of important expenses almost immediately.

How Can Factoring Benefit My Business?

Factoring is a great way to help both businesses that are starting out and businesses that cannot keep up with their growth. When you need cash now, that is when you can turn to factoring companies. Late payments from customers cause cash flow shortages, limiting your ability to pay for necessary expenditures like utilities and salaries, and capping your chance of growth. Even when your business has high revenue, you still might not be seeing your cash right away. While using invoice factoring, you can pay off all your bills on time and improve your credit score, allowing for chances of larger investments or loans in the future.

Business loan approval can take months to process and require you to pay back much more in interest, and this is all assuming you are able to qualify for one right away. Factoring is the ideal short-term solution for your business to get the capital needed quickly since approval is much more achievable, and in fact is more dependent on your customers’ financial situation rather than your business’.

While there are fees involved with factoring, there is a chance to save money by reducing time and money spent on administration tasks associated with invoice collections. Factoring companies will handle collecting paid invoices from your customers. You may be able to eliminate the need for an administrative assistant, or at the very least free up more time for your employees.

What is Factoring in Business?

Factoring companies are more concerned about your client’s financial situation than yours. They buy your invoices, so in order to pay them back, you need the client to pay your invoice. You may need to confirm your customers’ payment history to establish credibility to get more capital upfront.

It’s wise to keep in mind that once a factoring company purchases your invoice, you will need to pay it back regardless of whether or not the invoice is paid. This could potentially result in a double loss, putting you in a similar spot to where you started. Factoring is a quick solution, but one that requires some diligence. Look into non-recourse factoring which places the responsibility on the factoring company, where they will suffer the loss from an unpaid invoice instead of your business.

Factoring is a one-time transaction to draw from whenever you need it. It is not reoccurring funding or a contractual agreement. However, this gives you the power to create capital from the beginning or as needed, without any obligations. Either way, factoring can be a great short-term or long-term solution.

Advanced Commercial Capital: Risk-Free Debt Factoring

Additionally, we offer:

• Fast and flexible funding options, paying you in as little as one hour for your freight bills
• Strong relationships that foster your success
• And valuable benefits that save you both time and money, from our free fuel discount card program to free credit checks
All of these are just some of the reasons why our clients choose to stay with us for the long haul.
Advanced Commercial Capital can help your trucking company succeed in ways you never thought were possible.
Talk with our team to learn more about how non-recourse debt factoring works by giving us a call at 855.465.4655 or reaching out via our online contact form. We look forward to offering you the easiest and smartest way to factor your freight bills and get the cash you need, without any surprises.

Invoice Factoring Rates: A Complete Guide

Are you considering going into business with a factoring company, but still need some answers before doing so? What kind of risks are involved? When can you expect to receive your funds? How much do freight factoring companies charge? In this article, we will address the determining components of how much freight factoring companies charge, including common pricing, special fees, and more to help get you jumpstarted on the basics.

Common Pricing & Fees

What Is a Factoring Fee?

Factoring fees are the initial percentage of the invoice taken by the factoring company. While they can vary depending on the company you work with, a good rule of thumb is to gauge anywhere between 2-4%. If it is much higher than this, you should know that better options exist, and you may be working with the wrong factoring company.

One exception to this rule may come from non-recourse factoring plans. Because non-recourse factoring poses more of a risk to the factoring company, the costs may be slightly higher. In this scenario, most companies start their factoring fee around 5% for non-recourse factoring and can go as high as 8%.

Monthly Volumes

Some factoring companies also require carriers to meet certain benchmarks known as “monthly volumes.” This term means that your shipping company must factor in a certain amount of loads each month or risk an additional charge. The form this fee takes could either be a single flat fee, or an increase in the factoring fee percentage. In either case, it is important to have a conversation with your factoring company about what their monthly volume requirements are if any, and what the penalty may be.

Reserve Rate

For factoring companies that use a recourse factoring structure, a deposit will be kept on hold as a form of insurance against delinquent payments. Again, the amount can differ between companies, but usually, it is returned to the carrier whenever the factoring company receives their payment.

Invoice Factoring Rates for Companies: What to Look For

Typically, factoring companies in the trucking industry offer a flat fee structure. This system means that you pay a one-time fee that remains the same, no matter how long it takes your customers to pay their invoices.

However, some companies will calculate their invoice factoring rates using a variable structure. As previously discussed, most companies will take a small percentage (2-3%) of the invoice for as long as the invoice goes unpaid. However, an added caveat to this structure could be that the longer the customer takes to pay their invoice, the more you will pay in fees.

For example, your factoring company may charge you 3% for the first 30 days. For every two weeks that pass after those 30 days in which the invoice balance is left unpaid, the factoring company will charge an extra 0.5%. Make sure you are working with reputable clients who will pay their bills on time to avoid such an issue.

What About Long-Term Contracts?

Some factoring companies require you to sign contracts that bind you to work exclusively with them for long periods. However, this is not true of all factoring companies in the industry. If it is important for you not to be tied to one factoring company for the long term, there are options out there for you.

How Does Advanced Commercial Capital Compare?

At Advanced Commercial Capital, we understand that our mission is to help your trucking business succeed. That is why we do everything in our power to offer you the best deals and earn your business every day.

Advanced Commercial Capital has one of the most competitive non-recourse factoring rates in the industry, no long-term contracts, and no set-up or termination fees. We know that making a significant change to your business model is stressful enough, and we do not want to charge you for doing so.

If you decide that factoring is not for you, our Freedom Back Guarantee allows you to leave at any time. While not every factoring company offers this guarantee, not every factoring company cares about the wellbeing of its customers like Advanced Commercial Capital does.

Fill out our contact form, or call us at 855.465.4655 if you’d like to have a conversation about how our freight factoring can be beneficial to your trucking business. We look forward to hearing from you and helping you succeed.

Resources:

https://www.invoicefactoring.com/factoring-blog/factoring101/much-invoice-factoring-cost

https://www.factorfinders.com/cost-of-factoring#:~:text=A%20factoring%20company%20may%20charge,fee%20is%20charged%20up%20front.

https://www.getinstapay.com/blog/common-freight-factoring-fees

Freight Capital: Everything You Must Know

In its purest form, capital refers to the assets you possess which increases your economic standing and power. But what is freight capital and how can it help your company grow? Together, we will outline everything you need to know about freight capital and how to ensure it contributes to the success of your business.

What is Freight Capital?

In the freight industry, capital most often takes the form of your unpaid invoices. If you manage your own invoices, you often wait as many as 90 days before receiving payment. This delay not only stalls the growth of your business but can also hinder your ability to pay bills or meet payroll deadlines. However, there is a better way to handle your invoices.

How to Capitalize on Your Freight Charges

By selling invoices, you can generate immediate cash flow for your business and facilitate immense growth.

Under the traditional model, your process likely looks something like this:
• You haul and deliver a shipment to your customer.
• You send an invoice to your customer for the completion of the job
• You wait for the customer to pay their invoice before seeing any of the profits of your work.

This “hurry up and wait” process is less than ideal to say the least, not to mention inconducive to steady business growth.

But with the addition of a trusted factoring company, the process can instead look more like:
• You haul and deliver a shipment to your customer
• You sell the invoice to a factoring company
• The factoring company then sends you the cash for that invoice while they wait to collect the payment.

Sounds like a great deal, right? It gets better.

Freight Capital: How it Can Help Your Business Flourish

Of course, the quick cash flow is great for growth during prosperous economic times, but freight capital is also debt-free. The money the factoring company sends to you is not a loan, but rather funds you have already earned. You simply get access to the freight capital faster with a factoring company.

Gathering your freight capital in this way can also relieve the worry that comes from waiting for your clients to pay their invoices. Gone are the sleepless nights, wondering if you will be able to pay next month’s bills or your team. Instead, feel the confidence that comes from knowing you will get paid on time for your hard work.

Is Freight Factoring Right for You?

Non-recourse financing from Advanced Commercial Capital can assist your business in creating positive cash flow to streamline your accounts receivable process. If you are tired of constantly worrying over whether you will be able to make payments, pay your drivers, or grow your business, then freight factoring is a solution worth looking into.

There are many excellent reasons to choose Advanced Commercial Capital as your factoring company, such as our lack of long-term contracts and fees.

You can reach out and learn more about us via phone at 855.465.4655 or fill out our online contact form. We look forward to speaking with you and helping your business succeed.

How to Become a Freight Broker

If you have been looking for a way to boost your business while reducing time spent on the road, starting a freight brokerage may be the perfect solution for you. While it used to be quite difficult to start a freight brokerage company, new regulations created in the 1970s now make this opportunity more attainable for individuals across the country. Read on to discover the basics of how to start a freight brokerage business.

Step 1: Industry Experience

To facilitate relationships in the trucking industry, it is important to understand the ins and outs of the transportation industry.

Insider knowledge and understanding of the industry is a great place to start. Whether you’ve worked at a shipping company previously or with another freight brokerage, this work can give you insights into what one side of the industry is looking for from the other, putting you in a unique position to deliver the best service.

Additionally, you can help facilitate the development of your freight brokerage company with strong soft skills such as math, critical thinking, and communication. If you are looking for more official training, there are many online classes and educational books available.

Step 2: Develop A Business Plan

A strong business plan is really where your freight brokerage begins. In your business plan, you will specify your niche and target customers, fleshing out the specifics of how your business will run. A plan will also give you the ability to register your business name and apply for a line of credit to get started.

Step 3: Find the Right Carriers

As a freight broker, your goal is to develop strong working relationships with the right carriers for your business. Ideally, the carriers you work with will be a part of the niche you have chosen and will be trusted, reliable, and professional. While there are several online directories where you can peruse carrier options, you may already have direct references and connections with the carriers you would like to use, as mentioned in step one of this guide.

If you are having trouble deciding between several options, remember that there is nothing wrong with testing out your top contenders and going with the best option.

Step 4: How to Handle Freight Brokerage Legal Affairs

Before beginning your business operations, you will need to address two major legal necessities: obtaining a USDOT number and becoming licensed as a Motor Carrier with Operating Authority.

A USDOT number is a unique identifier for your company that allows quick access to future safety information. That information is gathered during accident investigations, inspections, audits, and compliance reviews.

To apply for a USDOT number, you can follow the steps to register online at the Federal Motor Carrier Safety Administration (FMCSA) website. After you receive your USDOT number, you will continue with the process of getting licensed as a Motor Carrier with Operating Authority. The total processing time for this is between four to six weeks.

Once your application has been approved, the FMCSA will send your MC number. When this is issued, it is posted on the register page of the FMCSA. After a 10-day period, in which people may protest your registration if they find a problem, you are officially granted MC authority and are ready to start your business.

Step 5: Hit the Ground Running, and Start Succeeding

Now that you have experience, a business plan in place, and all necessary legal affairs handled, it is time to open your business and get started! With the groundwork laid, you have everything you need for your freight brokerage firm to find success.

Advanced Commercial Capital: An Industry Resource

Advanced Commercial Capital is here to help the freight industry continue to grow with confidence. To get in touch with our team, call our office at 855.465.4655 or fill out our online contact form today.