Factoring represents the most efficient way to grow your business and increase your profit. After you deliver a load you won’t be paid on the spot. So, you’ll need to wait several days or even months. For a bigger company, that could not represent a problem, but for the smaller ones, things are different. As an owner-operator or small company you need capital to develop and late payment doesn’t help you.
The process of factoring can be offered by a professional truck dispatch company. They transform your unpaid invoice into cash and then make sure that the client pays for the delivery. Like that, the cash flow of your company accelerates. The faster receiving of money helps you invest more rapidly in your company and increase your profit.
In return for their services, the truck dispatch company demands the paying of a small amount from the income and some additional fees. Although this means a reduction of the profit/load, in the long run, the profit will be advantaged by the collaboration.
What to expect from the process of factoring?
The process follows a series of well-defined steps. So, this is what to expect from the collaboration with a truck dispatch company:
- Firstly, the load is delivered to the customer and the driver receives in return a signed invoice.
- Then, the driver should send a copy of the signed invoice to the factoring
- The truck dispatch company gives the driver a percentage from the still unpaid invoice.
- The percentage can reach up to 98% of the value of the invoice. Now, the income can be invested in the growth of your business.
- The final step is the billing process. The company that provides you with factoring services will take care of all the details, including collecting the payment from the customer.
Also, this kind of service is recommended for businesses with cash flow problems. You can make sure that your company won’t go bankrupt because of the long period between the delivery and the payment.
What are the advantages of factoring services?
If you didn’t reach factoring services so far, these are some important advantages that you must consider:
- Upfront payment – It represents a considerable advantage, especially for drivers. Paying your employees on time is very important for the proper operation of your business. This way, you make sure that there won’t be any misunderstanding between you and the drivers. Also, payment represents a method of encouraging them to give their best when delivering loads. So, not only do the drivers receive their payment on time, but you can focus on new loads and invest in the growth of your business.
- Reduce nonpayment risks – Commonly, you deliver a load, and then the customer “forgets” about the payment. The factoring truck dispatch company makes sure that all your clients pay for the services, so, don’t waste any more time and contact a truck dispatch website so you can benefit as soon of possible from this service. At this point, you would have already been paid by the truck dispatch company. So, it is no longer your duty to assure the payment from the customer.
- Flexible income – Even though you will receive a percentage of the income, you won’t deal with nonpayment anymore. Also, it is possible to get up to 98% of the value of the invoice. So, you pay a small price for a risk-free business and secure development.
A truck dispatch company is ready to help you develop your company. There are lots of services that they can help you with, including factoring. So, when you observe problems in your cash flow, don’t hesitate to reach professional help. This way, you won’t face any limit situations.