If you are in transport business then your company is constantly in need of cash to pay workers, fuel trucks and fulfill many other obligations. The problem is many of your customers may take time to pay for the invoices and others still need you to fulfill the services as usual. This can take a strain on your cash flow especially when some clients take longer than expected to fulfill their obligations. This is where an invoice factoring company comes in. Even though they offer the same service, not all of them are the same and you need what to look for when choosing the right one.
They Must be Flexible
Flexibility is very important when choosing the right company. You need to check what kind of invoice bills the will accept and pay for. Some will not let you chose the kind of bills you want to send them. Allowing you to choose can help you by submitting the invoices of customers who take too long to pay, this way you get quick cash on such payments and still get the other accounts receivables as expected.
Another problem with flexibility is when the freight factoring service provider has a minimum number of bills that you should submit. This can also limit your choices especially if your volumes are small. The company also gets to force you to take a larger advance than you need. The company therefore takes a discount on an advance that you never needed in the first place.
Check their Terms
When looking for this service for your freight business, you need to be clear on the terms. First you need to understand the kind of factoring you are getting. There is one type where the advance is provided if the customer fails to pay the bill; the other type is where an advance is given promptly whether the customer decides to pay up or not.
Capacity to Review Applications Fast
Some companies may have hidden fees to trick you into paying more. Usually the advance can be anywhere between 80% and 99% of the amount owed by the customer. However, there may be bank charges or wire transfer fees among many other hidden fees that they could charge you if you are not careful.
An invoice factoring company should have good customer service that responds to their client’s queries. They must also have the capacity to review the application and respond promptly typically within 24 hours.
Jhon Grath is an experienced Content writer and publisher for Accounts Receivable Financing Company For Your Freight Business. Visit at http://www.factoringquotes.com/ to know more about Accounts Receivable Financing Company and Freight Bill Factoring.
How To Pick The Right Accounts Receivable Financing Company