Receiving payments on net-30 or net-45 terms can put a strain on your small or medium-sized business. That’s because ready access to funds makes a significant difference in how your business operates and performs.
Freight factoring is a solution to this problem. As you’re about to learn, using freight factoring services completely eliminates the waiting period before you receive payments.
At BP Financing, we’ve been providing freight factoring services to businesses for over 15 years. Here’s some information to get you started.
What is freight factoring?
Freight factoring is a process by which your company’s accounts receivables are converted into cash. This is done through you selling the freight bill to a factoring company, which then sends you an advance immediately afterward.
When a customer eventually pays the invoice after the waiting period, they’ll pay out to the factoring company.
How do freight factoring services work?
Suppose you run a shipping company and a customer asks you to transport goods to a certain location.
After the customer hires you to deliver the package, you’ll run a credit check with your factoring company to see if the customer and the load qualify.
Assuming they do, you’ll send an invoice and all relevant paperwork to the factoring company immediately after the delivery. The factoring company then purchases the invoice, and you and your company receive payment.
Factoring companies differ in how long they take to pay, but it’s typically much shorter than the common net-30, net-45, or even net-60 terms you’ll get from most customers.
If your factoring company is BP Financing, you’ll usually receive payment in under 24 hours.
Afterward, the factoring company will collect the payment from the customer based on your previously agreed terms. In most cases, you don’t have to do anything at this point.
Why you should consider freight factoring for your business
The main advantage of freight factoring is the fact that you’ll receive speedy payments.
Maybe you’d like to re-invest the money into your business, use it for immediate expenses like paying drivers or servicing vehicles, or capitalize on an opportunity that will be long gone by the time you receive payment. And that’s not to mention the possibility of unexpected emergencies.
As a business owner, access to working capital is essential for keeping your business running and growing it. Freight factoring ensures that you always have the funds you need.
Best of all, you won’t have to take on any new debts that can stifle your company’s growth and restrict your cash flow years down the line. Likewise, you don’t pay any interest on your advance.
Freight factoring services also place you in a more favorable position to win new business. Customers generally prefer to work with companies that have the financial collateral to wait for payment on their terms.
Why choose BP Financing as your factoring company?
Freight factoring services can make a significant difference to your business, and that’s especially true if you work with the best of them.
BP Financing has been serving business owners like you for more than 15 years. In addition to our speedy payments and quality services, we’re also differentiated by our commitment to customers.
We understand that receiving payments can be stressful, especially when you have a business to run. That’s why we have a dedicated customer service team, always available to help you with any issues you might run into.
Get in touch with us today to always receive payments early
Waiting periods of 30 days and more are not ideal for your business. With freight factoring services from BP Financing, you can start getting your money as soon as you’ve finished the job. Call us today at 845-352-3700 or leave a message on our contact form and we’ll be in touch.