Is Factoring Good for Trucking?

Factoring can be very good for a trucking company. When you don’t have the resources to hire an accounts receivable team, some factoring services offer full-service invoice factoring where they’ll manage customer invoices for you. This changes the game around collecting your unpaid invoices. You’ll get cash quickly to keep your trucking company running and forfeit a small portion of your overdue invoices as payment. What makes it a potentially risky move for trucking companies is the possibility of hidden fees and chargebacks that can put you into debt. Before signing any contracts, it's important to get a detailed look at the fee structure.

What Is a Good Factoring Rate in Trucking?

A good factoring rate in trucking is about 2% or less . You may find rates lower or higher than that depending on the credit rating of the freight broker or supplier your invoice is under.

How Do I Choose a Trucking Factoring Company?

When choosing a trucking factoring company, you have to consider several aspects of each one. • Customer service rating • Speed of funding • The fee structure • Ease of use • The type of factoring (recourse or non-recourse) • Weekly or monthly rate The way you prioritize these elements depends on the specifics behind your trucking company. If you need a fast turnaround on your money, you’ll want to prioritize a company with quick funding times. If you need a full-service factoring company, you may want to prioritize customer service since they’ll be contacting your valued customers on your behalf.

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The 6 Best Factoring Companies For Trucking 2024

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