When you’re looking for top factoring companies for freight brokers, there are several things that need to be considered. What is a factoring company? What is an invoice advance loan? Why get an invoice advance loan? Who offers the best invoice factoring? Which is better, commercial factoring companies or small business factoring?
And more importantly, what are the basics of information on the top factoring companies for freight brokers? Let’s take a look.
Invoice factoring is a type of financial transaction and debtor financing option. A business can sell its invoices, or accounts receivable, to a third party company (or the factoring company) at a discounted rate. This is usually done in a method of accounting for immediate cash needs of the company selling the invoices. This can also be done to avoid credit risks to the company.
How does this all work? Invoice factoring is a type of accounts receivable financing that converts outstanding invoices due within 90 days into immediate cash for your small business. The company in question can provide a service or product to financially savvy customers, and then they submit the appropriate invoices for these transactions/purchases. Any unpaid invoices are then sold, or transferred, to a factoring company that will verify these invoices and can provide immediate payment for the amount of the invoices. Customers then will make any payments directly to the factoring company (since they shifted the money to the company providing the service or product already). They return the money to the company with accruing fees (for the company) in mind. The important thing to remember is that this is NOT a bank loan. Factoring companies can really help small businesses out there bridge invoice payment gaps with upfront payments up to 90% of the original invoice.
Why would someone need to consider top factoring companies for freight brokers or another industry? These transportation and freight companies rely on proper finances to keep their businesses moving. These factoring companies can help to manage the cash flow of freight brokers, while also protecting credit ratings and truck capacity of these companies.
Nearly 12 million trucks, rail cars, locomotives, and vessels move goods over the transportation network. Keeping the finances in line for these freight companies is absolutely crucial to the infrastructure of this country. Why is this? This country relies on products being brought to the market. Who takes care of that process in almost all cases? Freight companies. In order to keep this a smooth process, factoring companies can be considered essential.
With integrity, great customer service, and the top financial management skills, freight broker companies can rely on the top freight broker factoring companies to manage their finances and keep their businesses running and products heading to the market for the nation’s growing consumer base.