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How to Choose the Right Freight Bill Factoring Company

Apr 28, 2008
In order to lay your hands on ready cash, you can avail of the services offered by the right freight bill factoring company. The problem here is to find the right freight bill factoring company otherwise not only will you be in financial trouble but your reputation and relation with your clients could also be marred forever.

In freight bill factoring, your credit invoices, which you would have issued to your credit clients, are bought by these companies. They then transfer the invoice amount minus their invoice factoring charges into your bank account within 1 or 2 days. So, instead of waiting for 30 to 60 days for your credit payments, you could now have access to that amount almost immediately after issuing the invoice. This can improve your cash flow immediately and help you to pay off drivers' salaries and other expenses such as fuel, servicing and repair charges on your truck fleet. This financial arrangement looks very tempting but a proper research is needed so that you do not land up with an inefficient factoring company. Here are a few things that should be taken up by you before you decide on a particular factoring company.

Cross-Check the Factoring Company. Take details of some of their existing and past clients and speak to them regarding the quality of services availed by the clients. You should also make a personal visit to the factoring company's office and check out his setup. If he is operating from a trailer or a small, shady, rented office then avoid dealing with such a company.

The Factoring Company's Charges Should Be Reasonable. The factoring company should charge a reasonable fee for its services. Try to zero in on a company where you do not have to sign a term contract so that you can exit the setup if you are not comfortable with them.

The Factoring Company Should Have Proper Experience. The freight bill factoring company should have prior experience in dealing with companies of your size and turnover and should also have handled clients similar to yours. They should pay you the amount promised and always on time. They should know how to handle difficult situations without aggravating them and your clients too should be comfortable handing over your payments to them.

The Factoring Company Should Be Efficient. The staff of the factoring company should be polite, tactful and efficient since they will collect your invoice amounts from your clients. They should ensure that your hard work of building up a relationship with your clients is not compromised by their rude behavior or their incompetence. They should have all the data required in their hands before they contact your clients for collection of payments.

The Factoring Company Should Be Accessible. The factoring company should be accessible to you and your clients if not on a 24/7 basis, then at least during normal working hours. They should have specific staff to handle certain clients. This staff should be well aware of the clients credit history or any other specific points related to that client. That way, any queries or problems can be nipped in the bud before it assumes dangerous proportions.

So, check out the above factors before hiring the services of any freight bill factoring company. Compromise a little on their charges but not on the quality of service, which is expected from them.
About the Author
Truckers, are you fed up with high fuel prices?, you can grow your business without a loan. Freight Bill Factoring gives you the cash needed to expand your trucking business. To learn more or get a quick factoring quote visit : http://www.phoenixcapitalgroup.com/quickQuote/index.asp
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