Factoring services are more familiar among both small and large businesses that wish to maintain a constant cash flow. If you are new to factoring and want to make use of it, you should understand what is factoring. Factoring deals with getting immediate cash funding in exchange of one’s accounts receivables to a third party. A factoring arrangement necessitates customers to sell their remittances to a lockbox that will be controlled by a finance company. If you factor an invoice, the factoring service will advance to you a percentage of invoice value, normally within 24 hours. The factor then pays you the remaining amount of the invoice, reducing fees once it collects payment from your clients. The rate of cash advance can differ based on which industry your company is in and who you choose as a factor. The credit history of your customer, your industry and other criteria helps determining the rate of advance you obtain.

Boosting cash flow is the major reason most of the companies’ factor. But, factoring offers many other benefits as well. Factoring offers free back-office support, which include handling collections from your customers. This offers you more resources and time to focus on developing your company. Factoring is based on the quality of customer’s credit, but not your own business history or credit. Factoring can be easily managed and customized so that it offer required capital if your company wants it. Factoring cannot be compared to loan, so you need not incur debt if you factor. Factoring is scalable, which indicates the amount of financing can grow as your invoices grow.

Companies of any size, from businesses run by individual to those in fortune 500 corporations can use factoring as a mean to improve their cash flow. Factoring covers all industries, including trucking and transportation. Services associated with trucking factoring enables truckers to get paid instantly for loads they deliver regardless of whether their clients pays on time or not. Truck factoring for service-operators makes it simple to access the money you want immediately. Waiting for customers to pay off their invoices is annoying, but you need not have to put your business operations on hold due to this. Factoring companies offer you advanced cash in exchange of invoices in order to keep business moving on.

With freight factoring, it is possible to convert your freight bills into same day finance. The transportation factoring services can assist you receive the necessary finance for fuel, repairs, payroll, equipment and your complete on-the-road expenses. With freight bill factoring, you can able to fuel your cash flow and more. Fuel advances are easily available on every factored load. By financing before delivery, you need not have to pass up a rewarding load again. You can also enjoy significant discounts on all fill-ups with free fuel card for trucking. Freight bill factoring assures you will not have to miss out a profitable load because of the lack of working capital for expenses upfront. Freight bill factoring is a reliable solution for all trucking companies.

Jim May is the author of this article on what is factoring. Find more information, about trucking factoring here