Finding the Value of Freight Factoring
Obtaining payment on outstanding invoices can be a lot like herding cats, making it especially challenging when juggling it with the other responsibilities of running a small business. While the industry standard for payment is between 30 and 90 days, some businesses may see longer wait times for collections. This is especially frustrating when you consider that the job was performed months earlier, and payment is needed to reinvest into your business to support growth.
As businesses expand, they often find that more time, money, and resources must be devoted to collections, either in the form of purchasing management software, or hiring staff to solely handle accounts receivable. However, many owner-operators and carriers have turned to the more efficient, less expensive alternative of freight factoring.
Simply put, freight factoring companies purchase your debt (invoices) for a fee, providing you with immediate payment for services rendered. You essentially outsource your accounts receivable, saving you valuable time and money. The practice has been around for decades, and provides small to medium sized auto carriers with immediate funds, as well as cool perks like industry discounts and fuel cards.
When a choosing a company to factor your invoices, ask the following questions:
You’re no stranger to hidden fees. Just try breaking down your cell phone bill and you’ll notice various fees that weren’t necessarily discussed in detail when you first signed your contract. Like any business, factors aren’t necessarily any different and can hit you with various “service fees” to offset any attractive factoring rates. Choose a company that is transparent with their costs so you know exactly what to expect each time the bill comes due.
When it comes to our fee structure for factoring invoices, Match Factors offers customers a no-nonsense approach, ensuring that what you see is what you get. We don’t believe in nickel and diming our clients with frivolous, hidden fees. Customers receive 95% or greater same day cash advances based on a flat rate structure, not a variable rate plan, guaranteeing that fees will never increase so that you know exactly what you are paying every time. Clients also benefit from the flexibility of submitting only the invoices they need.
Some factors will lock clients into contracts that force them to factor all or a minimum volume of invoices over a given time, or contain various hidden fees or “convenience” fees. While this may benefit the factor, it does not serve the client’s best interests.
Like our approach to service fees, Match Factors offers customers a simple, straight forward agreement for factoring invoices. There are no long-term contracts or monthly volume requirements/penalties. You simply submit as few or as many invoices for factoring as you want. Don’t need to factor any invoices this month? No problem; we’ll be here when you need us.
Not all businesses are created equal when it comes to how they manage their customers. While many recognize the value of earning a client’s business, others view their customers as just another source of revenue. Additionally, when it comes to collecting on invoices from the client’s customers, some factors may be overly aggressive, reflecting poorly on your business’ reputation.
Look for companies that are certified with the International Factoring Association (IFA) or Commercial Finance Association (CFA) which is an indication of ethical business practices. Membership with industry associations also demonstrate a factor’s dedication to the industry as a whole, and the people it serves.
As with any business, a positive Better Business Bureau (BBB) rating and favorable reviews on social media platforms from customers is a good predictor of their service quality and how you can expect to be treated.
Match Factors values developing personal relationships with customers and strives to provide a superior service experience in a family atmosphere. Our account teams know customers by their name instead of an account number, and we guarantee customers will always be greeted and assisted by a Match Factors representative, not an automated answering system when you call our office during regular hours. Clients can also login to our secure online portal to access important account information and documentation 24/7.
Our experienced accounts receivable team is proactive and assertive in pursuing collections on open invoices, but Match Factors representatives always conduct themselves in a courteous and professional manner.
Match Factors has earned an A+ BBB rating and is a member of the IFA, CFA and other prominent industry associations, like OOIDA, TIA, and ATA. We were recently honored as one of the top freight factors for 2018 by the Factoring Club.
On occasion, some newer factoring businesses may have limited funds, delaying the time it takes for clients to get advances. The point of factoring is to get your money now rather than waiting so you can make important decisions like purchasing new trucks and adding drivers. When shopping around for a factoring partner, look for companies with a reputation for being dependable. A factor with years of experience can also work to your advantage when it comes to choosing jobs, as your factor may identify red flags regarding your customer’s willingness, or ability to pay within a reasonable timeframe on their invoices.
Founded in 1985, Match Factors has assisted small to medium-sized motor carriers and owner-operators for over 30 years with freight factoring services, making us a dependable choice when it comes collecting on your business’ accounts receivable.
We are the first company in the industry to offer customers 95% cash advance on purchased invoices, and we will put our more than three decades of experience to use to help your business grow.
Some factors offer limited options for clients to submit invoices for payment, such as requiring that invoices be faxed. This can be a major inconvenience for customers and make the process of getting your funding less efficient.
For your convenience, Match Factors offers customers flexible options for submitting invoices including: fax, email, FedEx, original copy, and digital submission through the secured online customer portal. We make it easy for you to get paid.
If you believe freight factoring is the solution for managing your company’s accounts receivable challenges, affording you more time to focus on running and growing your business, then contact Match Factors to learn more about our freight-factoring services.
Why wait 30,60, or 90 days when you can get paid today? Increase your cash flow so you can allocate funds where you need it to get more jobs and build your business.