Now you know darned well it always the carriers fault...
ya hear the whinning all the time...they did this, they did that and on and on.....no wonder I don't ever do truck stops and am a Wally worm....
Factoring
- Thread starter flattop40
- Start date
Now you know darned well it always the carriers fault...
ya hear the whinning all the time...they did this, they did that and on and on.....no wonder I don't ever do truck stops and am a Wally worm....
am a professional sitter..
seems like there is a letter "h" and the word "bull" missing in there somewhere...lol
and you drive a straight truck too? amazing, didn't think they were that witty.....LOL
yep...get yourself through Monroe, I'll show it to ya. Lookin like I may be here for Easter.
Are you talking about Paychex? I think all they do is payroll processing.
Hey Mods, are you going to allow the straight truck bashing going on here?
*LOL* problem?
My people have to tolerate far to much injustice. But, I'll hold my head up and soldier on!! Damm the torpedoes!!
*LOL* problem?
<snickers> You didn't think I would come in here without back-up did ya?
I see how it is going to go...bring more guns to the showdown...lol....
One of the companies that I am leased on with factors most of their loads. I simply fax the paperwork over to the factoring compoany and my pay is loaded onto my company comdata card the same day I deliver. The other company pays me for any load done from last Sunday to that Monday on the same Wednesday not even a week after the load was delivered, sometimes within days.
But to get back to factoring, it is necessary for some smaller companies to factor because of cash flow issues, and it benefits the drivers to get paid as quickly as possible. I have no problem with a company that factors their invoices. People who say that companies that factor are financially unstable are just full of sheet. Look at what happened to Arrow Trucking when that flatbed company went bankrupt and closed up shop in the middle of the night? Do you think they were factoring loads, I beg to differ. Most if not all of their drivers got screwed out of their final paychecks. Any of the larger companies can go belly up owing you a check, even, gasp, E-1!!
But to get back to factoring, it is necessary for some smaller companies to factor because of cash flow issues, and it benefits the drivers to get paid as quickly as possible. I have no problem with a company that factors their invoices. People who say that companies that factor are financially unstable are just full of sheet. Look at what happened to Arrow Trucking when that flatbed company went bankrupt and closed up shop in the middle of the night? Do you think they were factoring loads, I beg to differ. Most if not all of their drivers got screwed out of their final paychecks. Any of the larger companies can go belly up owing you a check, even, gasp, E-1!!
I've been in trucking for over 35 years. You have to love it when some guys sitting in a $8,000 van think they know it all. Factoring has always been a part of this business.
For a small to a medimum size operation, to pay a small percentage for non recourse factoring is a no brainer. What you would pay to have a full time billing department, collections department, and then risking the no pays. It make good business sense to out source this headache and factor. A smal to medimum size carrier is finacially STRONGER because it can factor.
chefdennis
Veteran Expediter
As Turtle pointed out a whole lot of small to med businesses of all types us factoring companies and they can be strong companies finanically.
As to usig a Line of Credit, went the banking industry took a hit in 2008, banks were calling in lines of credit left and right, even for clients that they serviced for yrs and that were good strong companies...today for some small companies and especilly startups, getting even a small (under a 100 grand)line of credit can be next to impossible...ok maybe not quite to that point, but overly hard compared to what it once was..
As to usig a Line of Credit, went the banking industry took a hit in 2008, banks were calling in lines of credit left and right, even for clients that they serviced for yrs and that were good strong companies...today for some small companies and especilly startups, getting even a small (under a 100 grand)line of credit can be next to impossible...ok maybe not quite to that point, but overly hard compared to what it once was..
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WOW OVM, you are FULL of laughs TODAY! Think I'll mosey on over to the bank to just get a million dollar LOC.. no problem! (teehee!)
Who pays the cost for YOU to get paid (like an employee) on a timed and regular basis?
Did you ever think that the percentage you are paying YOUR carrier, which is substantially MORE than 3-6% of the gross, and more like 25-40% of the gross, includes the cost of fronting you the money before it is received?
Hello? Are you with us OVM? You don't THINK so?? I know of no other business that sticks it to its customers as bad as financial institutions do! And yes, they charge interest on EVERY PENNY! They even charge a service charge if you deposit coin into your own account that you're already paying for!
Wouldn't we ALL love to have THAT amount of cash? Can you even imagine how much cash that would BE that would be needed?
My guess is that you would quit the biz if you had to wait NINETY days to get paid after each load. How much would just the fuel alone cost you after 90 days of running... say 30,000 miles? Now imagine all the other costs, and then imagine doing it for HOW many drivers? Where is it written that you are less of a business owner than a carrier business owner?
am doing the math...if ya run say 15 loads a month and just take the low of 3% on EACH BOL....that is 45% of your monthly revenue...loan sharking at best....no wonder most don't make it..
or did I miss something?
Man, I hope you don't do your own bookkeeping and taxes??? Wow, you need a math lesson!
Not to attack you personally OVM, but this all leads one to question how much financial confusion there is out there amongst the general population of expediters. And in the confusion, lies an opening for one to be taken advantage of.
Wow, seems you did a pretty good job of it for somebody who is trying not to.
I'll give you credit, you came out swinging...lol. For what it's worth, I thought we had a good decent discussion of the topic. I know for a fact that at least one person learned a lot about the factoring side of the business (just got off the phone with him).
Seems you and I probably agree on the issue, but maybe you need to lighten up a bit. We ain't fightin a war or nothin.
jpalmer
Seasoned Expediter
I offer factoring services with my company I just started. Before i really understood how factoring companies can help. I didn't like it either. After all. Its taking money out of the companies pockets.
Most factoring companies don't just give you money fast. They are (the companies I broker for) complete billing and collection departments on your behalf. Which ends up saving the trucking company money on HR, salary and insurance expenses.
It really helps with cash flow. I don't recommend factoring all your invoices if you don't have too. Using factoring for those clients that pay later then some helps you...
The cost of not being able to do business is worse then factoring fees...
Most factoring companies don't just give you money fast. They are (the companies I broker for) complete billing and collection departments on your behalf. Which ends up saving the trucking company money on HR, salary and insurance expenses.
It really helps with cash flow. I don't recommend factoring all your invoices if you don't have too. Using factoring for those clients that pay later then some helps you...
The cost of not being able to do business is worse then factoring fees...
Thats ok Pjjjj understood "almost nothing" of what I said...Because she referred everything to the max of 90 days...some are only 30 days...
90 days of running for me or 3 months is about 4,000 in fuel...so a 30k bank roll would get me easily thru the wait...
it is ONLY the first 90 that is the rough part..after that it rolls over....just like a weekly paycheck..
Besides that Pjjj must be referring to Canadian banks....it is unbelievable the service charges they have....
90 days of running for me or 3 months is about 4,000 in fuel...so a 30k bank roll would get me easily thru the wait...
it is ONLY the first 90 that is the rough part..after that it rolls over....just like a weekly paycheck..
Besides that Pjjj must be referring to Canadian banks....it is unbelievable the service charges they have....
Yes, factoring companies often offer a "suite" of services. But like anything these services come at a cost. A smaller carrier may determine that these costs are worthwhile as they do not have scales of economy advantages.
I do not think that a carrier that factors is financially unstable. But, I do think that a carrier that does not is most likely more financially stable. Banks set the bar and credit requirements much higher than most factoring companies. They also tend to loan a smaller percentage and have much greater rules and regulations. If a carrier can meet these criteria, they generally pay a lesser amount in interest and an overall reduction in the "cost of money".
It is a very popular method of financing for start up carriers and small carriers. As a carrier matures or grows they should have the goal to move away from it and build a deeper financial base of security.
My 2 cents.
I do not think that a carrier that factors is financially unstable. But, I do think that a carrier that does not is most likely more financially stable. Banks set the bar and credit requirements much higher than most factoring companies. They also tend to loan a smaller percentage and have much greater rules and regulations. If a carrier can meet these criteria, they generally pay a lesser amount in interest and an overall reduction in the "cost of money".
It is a very popular method of financing for start up carriers and small carriers. As a carrier matures or grows they should have the goal to move away from it and build a deeper financial base of security.
My 2 cents.
CharlesD
Expert Expediter
That's pretty much where we are right now. We're still factoring most of our invoices right now, with the goal of eventually not having to, but for the moment our factoring company is a life saver.
Makes good sense. If the "suite of services" represents an economical advantage to the small carrier than it is a good choice. You have to be careful of growing too much relying on factoring. It gets harder and harder to break away from them as you get larger unless you are focused on weening them and building equity.
It seems to me Factoring is just a cost of doing business for some. Part of over head. Nothing more.