Owning and controlling a business is no walk in the park, as the business owner will be forced to deal with a myriad of complex, stressful and emotionally demanding problems that will arise in the course of doing business. However, as difficult as owning a business is and can be, it should be noted that owning a freighting and trucking company is exponentially worse.
The reason for this is that the freighting and trucking sector are forced to routinely contend with a woeful lack of cash flow as customers fail to pay on time as and when required….sometimes taking upwards of 8 weeks for their accounts to be settled. All the while, the routine expenses and overheads that will be incurred in the course of the business such as the cost of fuel, repairing and maintenance of the vehicles and the like will all need to be dealt with and paid for immediately.
As a result, a freighting company will need to have a rather substantial amount of working capital at its disposal in order to ensure that it is actually able to settle all the accounts that it has with its creditors and to do so in a short space of time. Unfortunately, this is not always possible and the fact that the working capital reserves are forever being depleted by these overheads will quickly make life much more difficult for the business as it seeks to expand and develop its business.
Fortunately, there is a solution to help the business break out from this tedious stalemate and that is freight broker factoring. With freight broker factoring, the business owner of the freight company will be provided with a sizable amount of money which will be directly determined by virtue of the net value of the accounts that are currently outstanding.
By virtue of the fact that they are receiving this money in a short space of time, this means that the freight company will be able to resist the worst effects of poor cash flow, meaning that the cost of the wages of the personnel along with the cost of fuel will not be a problem.
Furthermore, the fact that freight broker factoring is being used will mean that the credit rating of the business is immaterial and so the business owner will not be compelled or required to provide any of the assets of the business as a form of collateral for the factoring agency.
The fact that the credit rating of the business is immaterial is also beneficial because it means that even if a trucking company has had to cope with a rather poor performance due to sluggish market conditions (as is the case currently) this means that they will not be disqualified from being eligible for the results. Furthermore, the freight broker factoring company will also benefit from the fact that they are not actually required to repay back the money that they receive, nor are they eligible for an interest rate on the money actually taken out.
