The most comforting service that these companies provide is easy funding. Transportation factoring is a simple method of getting freight bills discounted. Regular shippers demand credit from you as a trucker. It may be one to two months and in some cases even longer, before they pay the bill. Here is one of the ways to get over money crunch in between. Have the shipper to endorse the freight bill and courier it to the trucking factoring company. It will pay you as much as 90% of the bill value immediately.
However, there will be certain norms and costs, which differ from one transportation factoring company to the other. Some of these formalities themselves act as additional facilities and can generate business for you. Here is a short backgrounder.
Prior approval of loads, acts as a fine way of getting business. For the trucking factoring company to accept the freight bill and pay you the money, it must obviously know the credit rating of the shipper. In the process, the factoring companies list all the loads approved and available in the vicinity. For instance, after delivering a load in Tampa, Texas you are looking for a return load. Your transportation factoring keeps you posted about details of consignments, destinations and often, even the offered freight! One such load board claims that it announces as many as 40 million approved loads a year. This should save you invaluable time required to scout for shipments and negotiating rates.
A Trucking factoring company as said already is a world peopled by truckers. A few of them are run by experienced transporters themselves; and they appreciate the peculiar needs of motor carriers better than any others do. If you have been finding insurance premium to be killing, ask your transportation factoring company; it might negotiate better terms with insurance provider for you.
Bulk Buying Power:
A few trucking factoring companies provide B2B services. Private fleet owners, small motor carriers can buy tires, fuel, tools at cheaper rates, because the factor gets better terms from leading vendors.
It is rather tedious to obtain permits from the Federal Motor Carrier Safety Administration (FMSCA) and the United States Department of Transportation (USDOT.) Some trucking factoring organizations help you to acquire permits and maintain motor carriers' licensing formalities.
All these services, including equipment leasing, fuel/repair payment cards, naturally come at a cost. Check whether the transportation factoring company is dependable and whether the fees are reasonable, before signing up.