If you’re the owner of a business that relies on trucks to transport your goods, you know how important the factoring process can be. Most of us, however, have no idea what truck factoring is. But if you’re looking to open a trucking company, understanding the factoring process is crucial to the success of your company.

A friend of mine was talking about hiring a factoring company for her business, and I had no idea what she was talking about. Soon after she explained it to me, I understood how important a factoring company was. I decided to research more about factoring companies for myself. Take a look at what I found and keep reading for tips on what you should look for in a factoring company!

What is the Factoring Process?

The factoring process helps carriers get paid in a timely manner for the goods that they deliver. Truck factoring companies will purchase your unpaid invoices for your customers as a lower rate, giving you cash immediately. This allows you to skip the long process of waiting for the customers to pay their bills — allowing you to grow your business and pay your employees at a faster rate.

Keep reading for a brief, but detailed account of the factoring process:

  • Select the factoring company best suited for you and your company’s needs.
  • Transport the goods for your customers like you would do on a normal basis.
  • Send the invoices you would like factored to your company of choice
  • The factoring company checks the invoices you sent with the customers.

And, finally, receive payment for the invoice in as little as 24 hours.

What Should I Look for?

Now that you’ve learned a bit more about the factoring process, it’s time for you to pick a factoring company that works well for both you and your company. If you’ve never worked with a factoring company before, it can be a bit confusing to know what to look for when shopping around. Hopefully, this list I’ve compiled below will help make the shopping process a bit easier for you and your company!

Timing

The whole point of hiring a factoring company in the first place is to get your cash advance as soon as possible. Any factoring company worth hiring will get you your money in 24 hours or less.

Approval

While some factoring companies will require you to submit an application as well as application fees, many factoring companies do not have such an extensive application process. If you don’t want to pay any application fees, keep in mind that many companies will not require that of you.

Extra features

Many companies have begun to provide their customers with additional features in addition to factoring. Look out for companies that can provide fuel cards, insurance assistance, constant account access, and more. These services can help your company grow to new heights — make sure to take advantage of them if they are available!

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