16. May 2012 05:35
Trucking is a unique industry because your product is moving the products of others. You move the country, ensuring that everything from food to clothing to furniture to mail reaches its destination on time. Because you fill such a unique and vital position within the economy, your business structure and revenue stream is sharply different from other companies. Freight bill financing is a unique concept, designed for trucking companies and used by many of the biggest transportation companies in the nation.
What Is Freight Bill Financing?
Although similar to accounts receivable financing or factoring, freight bill factoring is custom tailored for transportation. Once your freight bill is ready, you are eligible for financing based off of it. A non-traditional lender and transportation specialist like Crestmark will purchase the bill from you, paying you a portion of it immediately. Once the account clears with your client, you get the rest minus an administrative fee. Freight bill factoring can be traditional or discount depending on your needs.
Why It Works
You know how volatile the transportation industry can be. There's often a lag time between invoice and receipt of payment. In addition, shifting conditions like gas prices and unavoidable delays from weather can lead to a dramatically variable revenue stream. Financing can help smooth out the operation, ensuring that you have the cash you need when you need it.