Invoice Factoring

Compare Trucking Factoring Companies

By June 11, 2019January 19th, 2020No Comments
OperFi Sales

So you’re starting up your own trucking company and getting phone call, after phone call from insurance, compliance, and factoring companies trying to sell you on why they’re better and how they’re going to give you the best rate in town. You’re getting some really great offers and you’re tempted to go with the low-cost provider, but always be careful and read the fine print before getting involved.

Transportation Factoring Companies are notorious for hooking young trucking startups in on long-term contracts or hidden cancellation fees that they don’t fully understand on day 1. Sure, your rate looks good but why is the reserve so high? Great, they’ve approved you for a $100,000 credit facility but with 1 truck, do you really even need that much? If that credit facility is so high, check out the other terms in the contract that ask for monthly minimums and termination fees based on that facility. Can you afford a $5,000 cancellation fee?

Now, there has to be a balance on determining what’s fair and reasonable for a factoring company and their client contract. The factoring company has put a lot of time and energy into building the relationship with you, underwriting costs, credit checks, free portal access, and other services that you might not see on the back end. Having a cancellation fee sounds fair given the work they are putting into the relationship, but is $5000 fair given your monthly volumes and what you’re expected to bring to the table in value? It all depends and only you can be the judge of that, but it’s important that you understand that on day 1 and make sure you’re aware of it.

The transportation factoring space is somewhat mature, and competition is very high so rates are at an all-time low; so you really can’t go wrong if all you’re looking for is a cheap rate and minimal communication with your factor. If you know the space, understand billing, short pays, bond filings, and broker agreements, then maybe the cheapest rate is best for your company. But if you’re looking for a factoring company that’ll help and consult your company to building your operation, it might be smarter to pay a little extra for the special services that come with a smaller factoring company.

Find a factor whose interests are aligned with yours. Where rates adjust with your growing company and goals are growth and scale-ability. OperFi seeks to partner with small, earlier startup trucking companies in order to provide them the working capital and tools to grow their business. We offer competitive rates buts the difference between OperFi and the other top factoring companies is that we want our clients to be educated in the transportation space and understand not only what makes a successful trucking company but also what makes a successful transportation factoring company.

After all, if our clients understand how OperFi can be successful, then they will understand our point of view, but also be able to weed out the good factoring companies from the bad ones in the future.

Contact OperFi today by clicking here

OperFi

OperFi

OperFi is a transportation factoring company providing working capital and operational resources to trucking entrepreneurs looking to grow and scale their trucking business.

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