Are you a commercial driver, or thinking about getting your CDL? The road can be dangerous, and weather conditions are unpredictable. So, make sure you have the right knowledge to keep you safe on the road. Check out these tips to help you drive safely and be prepared for anything on the road.
When it comes to a trucking company’s success prompt and early paying customers are always favored. However many times the customers may not be able to pay up front and many even wait for up to thirty days before making any payments to the trucking company. No matter how big or old your establishment may be but there are always expenses that you need to cover immediately such as repairs, fuel and drivers or you might just find yourself in a very tight spot. Having money at hand is of almost importance. So how does a trucking company solve this problem?
• They can either request their customers for fast payments by making available discount offers for early payments. This option is fine but then again it is the choice of the customer to pay early or not.
• Another option would be to get a business loan. This option clearly addresses the cash flow problem but it is very difficult to obtain. Not many of the small trucking firms would be able to satisfy the flawless financial statements, track record and strong collateral as demanded by many banks.
• Transportation factoring is the best option. It is a new and popular idea which is fast gaining interest in the trucking communities also known as freight bill factoring. Such kind of a service eliminates the delay in obtaining the cash from the customers and helps maintain a steady cash flow. It is easy to obtain as opposed to other financing services requiring only a few days to set up.
In this system a third party company provides the cash in place of the slow paying customers of the trucking companies. Once the cash is obtained by the trucking company it can uses it as it wishes and cover its ongoing costs and expenses. Once the customer pays up the transaction is complete and is finally settled.
Freight bill factoring is easier to obtain and is a very convenient option for trucking companies. An important requirement to qualify for freight factoring is that the company needs to have a good market credit. The company should also be free of tax and legal problems. It is an ideal solution for small and growing trucking companies who have the potential to grow but are often faced with customers who pay slowly thus inhibiting their development.
Some of the benefits of such transportation factoring are:
• It removes the wait in getting paid thus ensuring a steady flow of cash.
• It helps to take on new assignments and projects with ease.
• It makes available the money which is much need to pay the drivers and for fuel and repairs.
• Is easy to set up within a couple of days.
If you have decided to tie-up with a freight factoring company, to improve your cash flow and also to handle your receivables, then it is important that you conduct a thorough survey of all the freight factoring companies in the market before zeroing in on the ideal company.
Since a freight factoring company will not just be a passive moneylender, but rather be an extension of your business, it is imperative that you locate the best on, since the company’s actions will reflect on your business. A freight factoring company will buy your credit invoices and pay you the invoice amount minus their factoring fee. They might also arrange to collect the invoice amount from your clients on the due date. Thus, it is essential that your freight factoring company act as a solid bridge between you and your customers, in particular on the delicate matter concerning payments. Here are some qualities that an ideal freight factoring company should positively possess, in case they need your business.
The Company Should Have The Relevant Experience: The freight factoring company should be experienced enough to handle your business. They should have successfully treated similar clients in the past. They should have the proper knowledge and staff to handle slow paying customers without raising the tempers of your customers. You should talk to some of the factoring company’s existing clients to get a feedback of their range and quality of services before you make a choice.
The Company Should Have Cool And Gracious Staff: The factoring company should have calm and courteous staff, who know how to handle credit clients and do not lose their cool, when some clients delay payments. They should have the necessary tact and skill to extract payments from your clients on the due date. They should have the latest data at their fingertips before they start calling or faxing your clients for payments.
The Company Should Have The Necessary Funds: The factoring company should have the required funds to pay you as soon as you present your invoices to them. Any delay on their part will adversely impact your cash flow and in short, negate the very purpose of appointing a freight factoring company.
The Company Should Present Presentable Terms: The factoring fee of the factoring company should be reasonable. They should not insist on a long or short-term contract since it will prevent you from exiting the contract, if you are not happy with the arrangement. If possible, locate a company that does not retain an additional amount as security, since this will only lock up your money.
The Company Should Delegate Specific Staff For Your Account: Once you do a tie-up with a freight factoring company, the company should delegate one or two staff members, specifically for your account. They should be responsible for monitoring your clients and should be answerable to you, whenever you need information or feedback. In case they have any trouble in handling particular clients, then they should inform you immediately so that you can take immediate steps to defuse the situation, before it goes out of hand. The staff should not be mechanical in their words and action, but instead, should interact with your clients and build up their trust and confidence.
You should tie-up with a freight factoring company, only if it possesses all the above qualities since any weakness on their part will be reflected in straining your relations with your clients and affect your business in the long run.
Freight rates change depending on a number of thing. These things comprise the mass of the load, the dimension, the value and also the cargo class. By means of the freight cost calculator, you can be clever to settle on the freight rates for yourself and only to verify this from the shipping company, before you choose someone to work with. This gives you the self-assurance that you require knowing that the goods will be shipped at a good cost without any problem being faced, as you will also be paid on time.
Freight Factoring Cost Calculator
Knowing the freight charge previous to the real shipping is of a huge significance, as you are conscious of what to wait for and diagram this well. A freight factoring calculator gives you the chance to evaluate different freight companies when you are familiar with the predictable rates for your goods. Diverse freight companies employ different freight cost calculators, as it will let you decide on what percent to pay for receiving the money for your unpaid bills. According to the quantity that they charge, you can make a decision whether to employ their services or not.
Usages of Freight Factoring Cost Calculator
A freight cost calculator allows a transporter to save time when doing the preparations for the shipping. This goes after the simple fact that a lot of people who are transporters just have no time to waste while doing their delivery. Most foremost shipping corporations have online freight cost calculators that can be access by transporters all the way through the company’s website. By just accessing the corporation site, a transporter can put aside him or herself a lot of time that could have been otherwise used up looking for a freight broker or else making the investigation related to the cost manually.
How to Use Freight Factoring Cost Calculator
After you have recognized the real cost of transportation using the freight cost calculator, it will be simple to map for the other things – for example warehousing and housing delivery in case it was not integrated in the price. These engage making additional payments for such services or even get in touch with another party or a forwarding service supplier to have the goods carried to the client or even stored in a warehouse where the client can get them.
Provided that you are familiar with the feature of your goods that are deliberate using the freight cost calculator to come up with the freight rates for supplies, you can employ a normal calculator to obtain the real cost of your freight. You can do this throughout getting such qualities as the size of your load, the weight, the amount of cartons and the others. You can otherwise visit a company’s website with the intend of getting the qualities that are used in getting the freight cost by means of a freight cost calculator.
Using a freight factoring company means that you will get your bills paid on time – having a truck delivery business means that you could have the chance to be delayed by your customers with the bills and invoices. Using this type of service will ensure you that your business keeps on running and there is cash flow ensured all the time. There are plenty of things to pay attention to when running this type of business, and covering the costs of gas, insurance and other things for the vehicles is very important.
So before hiring a freight factoring company you must first find out how much could they charge you for recovering the bills – each company takes a different percent for doing this, and you could get a cheaper cost for the service you need. Once you calculate the factoring rates, find out if is it economical to choose that company or not.