Do you need factoring in trucking?
Your trucking toolset goes beyond the box you carry in your cab with the wrench, tire pressure gauge, and reflector strips. It includes your partnerships with your local bank, mechanic, trucking factoring company, and others. Some who read this might wonder, is factoring worth it for trucking? Or, perhaps have not considered adding a trucking factoring company to that list. Then again, maybe you have, but someone you know had a bad experience with one, so you took it off the list. All things considered, factoring has its pluses and minuses like everything else and is something you should use when you need it, just like all other critical partnerships.
Some trucking companies prefer to use a trucking factoring company regularly, but others don’t; they direct bill or use quick pays. If you partner with the right factoring company, such as Tetra Capital, you have the flexibility to pick the best option for each load. The reason being that Tetra offers no monthly minimums and allows you to choose when and what to factor.
When should you use trucking factoring?
We have talked with carriers who feel they don’t need factoring because they like to direct bill or use quick pays. However, we have clients who do that with their regular brokers but use us to check credit and for their backhauls. For example, say you are coming out of Salt Lake City and have ten companies always giving you loads straight out of Salt Lake. You usually go to Seattle or Portland, or Los Angeles. And then one day you go down to Phoenix, and you don’t know anybody in Phoenix. So, you look on a load board to see what’s coming back. You find a few loads, but you have not heard of any of the brokers. As a result, you reach out to Tetra Capital to check their credit. Once Tetra runs the free credit check, you talk to the brokers they let you know will pay you. One of the big things about Tetra is that carriers decide who, when, and for how long they factor; there are no minimums.
Factoring is worth it for trucking
Factoring doesn’t have to dominate your life and all your decisions. You should use it when you need it and not use it when you don’t. You need to find a factoring company, like Tetra Capital, that will let you use it only when it makes sense. A trucking factoring company that won’t change your rate or your terms based on when you use them. A company that is not going to nickel and dime you. Tetra Capital is not going to charge you a bunch of little incidental fees to bump your rate. The trick is finding transparent factoring partners. Tetra Capital truly wants to be a great long-term partner for your business.