How does factoring help the trucking company?


Posted September 29, 2020 by factoringfast

In this write up, he deals with invoice factoring company , best online factoring companies in a very effective way.

 
Does your trucking company require cash to fix up the trucks? Every company needs to have a sufficient amount of working capital to meet its daily expenses such as tire fees, fuel cards, etc. Many a time, a business suffers from the financial crisis. Therefore, it becomes difficult for the business to meet their present and immediate cash needs. So, basically, a factoring company comes in assistance. It is the financial transaction or debtor financing method in which the business sells its account receivables held by a business organization to an outside agency. This agency is known as the Accounts receivable factor. They perform multiple numbers of functions which includes,
• Maintenance of sales ledger - A factor is held responsible for maintaining all the sales ledger of the client. He takes care of all the sales-related transactions of the client.
• Financing - The factor is the person who is engaged with financing all the clients by purchasing the accounts receivable. They manage the entire procedure of finance.
• Credit protection - In the case of non - recourse factoring, the entire risk of non - payment or the bad debts comes on the factor.
• Collection of money - The factor is bestowed with the duty of collecting all the funds from the debtor of the client. This helps the client focus on only the core activities of business rather than putting their energy in collecting money.
So, basically, a factor is a fund source that agrees to pay the invoice value after deduction of a certain amount of money. The entire work is done in a simple and transparent manner. The factor makes a payment of around 75 to 80 percent of the invoice value after deduction of the discount fee, which is the discounting charge. The remaining portion of the invoice value is said when the factor receives the seller's payment from customers. This amount is known as the factor reserve. Hence, improve the business's cash flow level irrespective of its working size by taking the help of the trucking factoring companies without any delay.
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Issued By Factoringfast
Phone 1-888-897-5470
Business Address 2000 Auburn Road Beachwood OH 44122
Country United States
Categories Accounting , Banking
Tags accounts receivable factor , factoring company , factoring trucking companies , freight bill factoring , invoice factoring company
Last Updated September 29, 2020