What is a factoring company?

A factoring company is a company that provides invoice factoring services, which involves buying a business’s unpaid invoices at a discount. Once your client pays their invoice (directly to the factoring company), you’ll receive the rest of the money your business is owed minus the factoring company’s fees.

Do you need a factoring company for trucking?

broker quick pays. Consistent funding is important for the success of a trucking company. Operating expenses don’t stop, and neither should your cash flow. Truck drivers can wait anywhere from 30, 60, or 90 days to get paid without working with a factoring company or using broker quick pays.

How much do factoring companies charge trucking?

How much do factoring companies charge? Factoring companies make money by charging a fee, usually a flat percentage of each invoice you factor. Generally, fees range from 1.15% to 3.5% per month.

What are the best trucking factoring companies?

In Summary: The Best Trucking Factoring Companies

• Riviera Finance: Best for non-recourse invoice factoring.
• BlueVine: Best for high credit facilities.
• Fundbox: Best for businesses that prefer a flexible line of credit.
• Lendio: Best for businesses that want to compare their options.

Why to use truck factoring companies?

One of the top benefits of truck factoring is that the deals can be quite flexible from a time standpoint. What that means is that truck factoring companies are going to be quite flexible with the time frame of your agreement based on what you need. If you need a short-term cash influx, you can make an agreement for a few months.

How does factoring work for trucking companies?

Freight factoring, also called transportation factoring, trucking factoring, or freight bill factoring, is a process in which the person or business that delivers a load sells their invoice to a factoring company. The factoring company then pays the carrier the full amount of the invoice, minus a small percentage, within as little as 24 hours of receiving the invoice, rather than waiting a month or longer for a broker to pay the invoice.

What are the costs of starting a trucking business?

Here is a breakdown of some of the biggest expenses you may have to bear when starting a new trucking business. An initial cost you can consider when starting your trucking company is about $6,000 to $15,000 (not including your equipment). This includes registration and formation documentation that, on average, cost $900 to $1,500 .

How do you start your own trucking business?

How to Start a Trucking Business. STEP 1: Get a CDL. First you’ll have to get your commercial drivers license (CDL) and get some experience. Some trucking companies have their own training programs. and some will help pay for CDL school. Many drivers who eventually become owner-operators start out as company drivers.