New to Factoring?

For those who aren't familiar with factoring, it is basically a fast way to get cash to run your business.

Factoring is Not a Loan

When you send your customers an invoice, they usually have 30 days to pay you back. Factoring companies will give you the bulk of the cash up front, sometimes within 24 hours, and collect the payments from your customers themselves. Once the invoices are paid in full, you’ll get the balance left over, minus a small fee.


Factoring Doesn't Require Debt

Sounds simple enough – fast cash for your business – no loans, no debt.

So how do you go about choosing the best factoring company?

Not all of them are created equal. Not all of them will give you the same level of service you need to help grow your business.

Everyone claims they have the simplest rate structure in the industry, no long-term contracts, same day funding, no up-front fees, no monthly minimums or maximums, etc., etc., etc.

We also offer these same benefits, but we GO THE EXTRA MILE FOR YOU that other factoring companies don’t.

Here’s Why We Are The Factoring Company You Need For Your Business

No other factoring company matches our level of superior service and offerings.


As you can see, we simply have more to offer you.

Other factoring companies don’t even compare.
Jackson

And Not All Factoring Companies Can Say This:

More than half of our new business comes through client referrals.

Some of the benefits you receive with factoring are:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Information for the city of Jackson

Jackson is the capital and since 1944 the largest city of the state of Mississippi. The city is located on the Pearl River (Mississippi Louisiana) which drains into the Gulf of Mexico and is part of the Jackson Prairie region of the state. Jackson is one of two county seats of Hinds County, with the city of Raymond being the other.The city, the anchor for its metro area, is named after Andrew Jackson, who was honored for his role in the Battle of New Orleans and later was elected as US president. The current slogan for the city is "Jackson, Mississippi: City with Soul."[6] It has had numerous musicians prominent in blues, gospel and jazz, and was known for decades for its illegal nightclubs on the Gold Coast; one site has been designated for the Mississippi Blues Trail.It had a decline in population from 184,256 at the 2000 census to 173,514 at the 2010 census.

 

The 2010 census ascribed a population of 539,057 to the five county Jackson metropolitan area.[7] The city is ranked third as the best "mud" city among the United States' 100 largest metro areas, according to magazine. The study measured overall affordability in living costs, housing rates, and more.In 2011 USS Jackson (LCS 6) was the first ship of the United States Navy to be named in honor of the city. Jackson is home to several major industries. These include electrical equipment and machinery, processed food, and primary and fabricated metal products. The surrounding area supports agricultural development of livestock, soybeans, cotton, and poultry. Major private companies based in Jackson include Ergon.

 

 

Information for the state of Mississippi

Mississippi's economy totaled more than $100 billion for the first time. Federal figures show the biggest contributor to growth in Mississippi last year came from makers of durable goods such as cars and ships. Nearly 30 percent of the state's growth came from that sector. Other large contributors to Mississippi's growth were expansions in the retail trade and finance and insurance sectors.

 

Manufacturers add value to raw products by creating manufactured items. For example, cotton cloth becomes more valuable than a boll of cotton through manufacturing processes. Processed foods are Mississippi's most important manufactured products. Meatpacking (poultry processing plants) is particularly important. Other food products are beverages, dairy products, grain products and seasonings. Furniture production is Mississippi's second ranking manufacturing enterprise and the state is one of the leaders in the production of upholstered products. The manufacture of chemicals (industrial chemicals, pharmaceuticals) ranks third in the state.

 

Other products manufactured in Mississippi include motor vehicles, motor vehicle parts, ocean-going freighters and tankers, electrical products, appliances, generators, lighting and wiring equipment, and stereo systems. Mississippi is a leading shrimp producing state.

 

You are about to be relieved of the stress and time consuming process of collecting on your accounts receivable.  

Each company has its own unique business needs, so some companies only factor invoices for customers that are slow in paying, whilst other companies factor all of their invoices. -Factoring Companies In Mississippi

 

 

FACTORING. HERE'S HOW.  

Factoring Companies In Mississippi Articles

The Best Kept Secret in Financial Services: Freight Bill Factoring!

 

If you're an existing owner of a trucking business, or perhaps you're planning on starting a trucking business, then you may be interested in Freight Bill Factoring. Freight Bill Factoring helps trucking businesses, both large and small, achieve their overall business goals; but before making any final decision you must fully understand how Factoring works.

 

Freight Bill Factoring has become very popular with trucking businesses and is often referred to as the financial backbone of the trucking business. If you're not familiar with Freight Bill Factoring, you may not know that factoring is a financing alternative for business owners: it gives them immediate access to additional financing capital they may otherwise not have access to. The process of Freight Bill Factoring is actually quite straightforward: it involves a factoring company purchasing bill of ladings at a discounted rate. This process is a win-win situation for both the trucking company who receives immediate funds and for the broker who pays for the invoices.

 

Freight Bill Factoring Is Not New!

 

Freight bill factoring is not a new idea; in fact, it has a long, rich tradition. Most civilizations that have engaged in commerce have also engaged in factoring in one form or another. For example, business relationships during the colonial period in North America were required to make cash payments in advance against Accounts Receivable in order for the business to continue with its commercial operations, prior to their users being paid for their goods. So, they were engaged in factoring!

 

Factoring Specialists Have Many Services to Offer

 

Of course, factoring has become a lot more sophisticated over the years, and today it's focused on financial management, credit worthiness, and on collections. However, the basic concept of purchasing Accounts Receivable has stayed the same. In addition, the modern factoring company of today can do a lot more than just funding: a factoring specialist can assist clients by evaluating and setting credit limits, verifying customer's credit worthiness, and professionally managing Accounts Receivable collections. Right across North America we see factoring companies existing in all forms and serving business sectors and industries of all types; and today, many large financial institutions even have their own factoring divisions. Generally, though, factoring companies are smaller, independently owned enterprises.

 

Banks Step Out as Factoring Steps In

 

Factoring has become very popular with trucking businesses because, as most business owners can verify, commercial lenders have become increasingly inflexible, with stricter regulations and ever-changing lending criteria. This inflexibility has forced both small and medium sized businesses to search for alternative financing sources, and this is where factoring has stepped in. Factoring is a simple, workable, solution-based process, providing an alternative for trucking businesses when traditional means of financing are not available. Factoring is proving to be a great financial remedy, particularly as banks and other lenders are becoming less friendly to small business owners.

 

Factoring Companies Operate Worldwide

 

The volume of factoring around the world has today exceeded the trillion-dollar mark! Factoring companies operate on every continent and, in the last four years, worldwide factoring transactions have increased by 60%. And that's why we say that Freight Bill Factoring is the best kept secret in financial services!

 

 

You are about to be relieved of the stress and time consuming process of collecting on your accounts receivable.

 

 

Factoring Companies In Mississippi Articles

About Invoice Factoring and How to Choose the Best Invoice Factoring Company for Your Business

 

Most people have heard of invoice factoring, but knowing exactly how it works and how to choose the right factoring company for your business can be difficult to ascertain. We've put together this brief guide to help you understand invoice factoring and to provide you with enough information to help you make the right choice for your business.Most business-to-business (B2B)companies find it very frustrating when forced to wait for customers to pay their accounts. When payment terms are over-extended, businesses of all sizes can find themselves dealing with cash flow problems. For some customers it's industry standard to offer long payment terms, but there are other customers who demand longer payment terms simply because they can. This is where invoice factoring steps in to assist businesses.

 

So, how does invoice factoring work? Invoice factoring is a method of keeping a business's cash flow steady without the business being forced to take on debt or sell equity.

 

In this article we'll look at how the factoring process works, the benefits it offers to businesses, and we'll also determine which businesses qualify for factoring.

 

Explaining Invoice FactoringInvoice factoring is when Accounts Receivable are purchased at a discount price. Today, invoice factoring is one of the most popular financing methods, helping thousands of businesses grow and expand. In fact, you may be interested to know that the history of the United States began with invoice factoring! Apparently, the Pilgrims used invoice factors in London to finance their voyage to Plymouth on the Mayflower. And once colonies had been established, invoice factoring remained a popular financing method among New World traders and merchants. So, as you can see, business owners have been using invoice factoring for thousands of years. Today, Invoice factoring is still considered the safest way of obtaining the funds a business needs to grow and expand.

 

Basically, invoice factoring converts a business's current unpaid invoices into immediate cash; solving cash flow problems caused by net payment terms of 30, 60, and even 90 days. Without reliable cash flow a business will fail to thrive because inevitably it will fall behind on rent or payroll and miss out on great opportunities to expand the business. Invoice factoring allows management to concentrate on growth by eliminating the frustrations of unpaid accounts.

 

The process of invoice financing is the selling of Accounts Receivable to a reputable factoring company. Invoices, which could well be outstanding for up to 4 months, are purchased by the factoring company for up to 98% of their face value.

 

The three participants involved in a factoring transaction include -

 

-The business who issues the invoice;

 

-The customer, or account debtor, who owes payment on the invoice; and

 

-The financing company, or factor, who purchases the invoice and provides immediate cash.

 

I've Heard Invoice Factoring Called Other Things - What Is the Proper Terminology?

 

It's true, the term Invoice Factoring is used interchangeably with other terms like AR Factoring, Accounts Receivable Financing, Receivables Financing, Invoice Financing, AR Financing, and Receivables Factoring; so just keep in mind that all these terms refer to the same type of funding.

 

How Invoice Factoring Works

 

Once a customer receives a product or service from a business, they receive an invoice. With invoice factoring, the business can now "sell" this invoice to their chosen factoring company. In return, the business will receive a cash advance, somewhere between 70% and 90% of the value of the invoice. Now that the business has cash in-hand they're free to cover payroll and rent, take on new work, buy new equipment, invest in new technology, and even be on the receiving end of early-pay discounts from suppliers. Once the invoice has been paid to the factoring company the business will receive the remainder of the funds, less the agreed-upon factoring fee, which is typically based on the value and term of the invoice.

 

Invoice factoring results in a win-win-win situation for all three parties: the business concerned receives immediate cash on the invoice submitted, the customer enjoys favorable payment terms, and the invoice factoring company earns their fee.

 

Comparing Invoice Factoring with Traditional Bank Financing

 

The difference between invoice factoring and bank financing is that invoice factoring is not a debt, and it's this fact most businesses find appealing. As a business, you sell your Accounts Receivable to the factor and you receive a cash advance - that's all there is to it. It's up to you what you do with the funds because no debt means no restrictions.

 

An added benefit of invoice factoring is that it's the credit quality of the business's customers that are evaluated, which suits not-yet profitable or early-stage businesses selling to the government or established companies, yet still trying to establish themselves. The factoring rate businesses pay factoring companies is much more attractive than alternative financing arrangements that don't take into account the credit worthiness of a business's customers.

 

Other benefits of invoice factoring include a quick and simple application process, a higher approval rate when compared with banks and other forms of financing, and a quicker time to funding. When it comes to the size of funding, factoring companies are very comparable with banks in-so-much-as they can fund up to $10 million credit lines. The streamlined approach to invoice factoring provides businesses with much needed cash in-hand so the business can grow and prosper, meet all its financial obligations in a timely manner, still have cash to invest in up-to-date equipment, source new and bigger clients, and receive discounts for bulk buys or early payment.

 

Applying for Invoice Factoring is a Relatively Simple Process

 

Most businesses are familiar with the stress of applying for a bank loan, but applying for invoice factoring is a very simple process: it takes less paperwork and certainly much less time, and is not as stressful as trying to raise equity. Invoice factoring involves a very simple application process, eliminating the stress and unnecessary hurdles placed on small businesses trying to access finance.

 

Because invoice factoring provides quick access to funding, businesses find themselves in a position to take advantage of great opportunities, like expansion and accepting large orders. For many businesses who have been denied access to bank finance, being accepted for invoice factoring allows the business to continue growing and expanding. Once you've been accepted for invoice factoring, the factoring company is basically underwriting your customers to the same extent that they're underwriting your business. Of course, another bonus is that funds received from factoring your invoices can increase your available bank credit.

 

As your chosen factoring company, we're here to help collect on your receivables, but only if you ask us to. Following your direction, our account managers will politely but firmly chase up outstanding invoices. If your decision is that you prefer we don't speak with your customers under any circumstances, we accept that too. Invoice payments are directed to a specific account created under your company's name.

 

How Much Cash Will I Receive Immediately?

 

The amount of cash you'll receive immediately is an agreed-upon percentage of the face value of your invoices. Industry advance rates typically vary from between 70% and 90% of the face value of an invoice, which means that if you're owed $10,000, depending on the agreed-upon advance rate, you can expect to receive an immediate payment of between $7,000 and $9,000.

 

The remaining amount of between $1,000 and $3,000, less the factoring company's fee, will be forwarded to you once your customer has paid their invoice.

 

How Much Do Invoice Factoring Companies Charge?

 

Depending on the face value of the invoice, factoring fees typically range from between 1% and 5% per month; however, our own factoring fees range from between 1% and 3% per month. Transparency is vitally important when considering factoring fees, and businesses should be aware that invoice factoring companies who make it difficult to determine their all-inclusive fees are companies to be avoided at all cost. This lack of transparency is designed to confuse customers and they use this confusion to their advantage.

 

If you're unsure about the information you've received on invoice factoring you must proceed very cautiously, or alternatively, try a different factoring company. The information you receive must be clear and concise, leaving no room for doubt or confusion on your part. Another aspect of invoice factoring that you should be aware of is that there are invoice factoring companies out there who advertise rates of 1% (and even lower)which may sound very attractive; however, they make up for these low fees with a range of hidden charges.

 

One sneaky way these companies attract customers is to charge a low monthly factoring fee, but you'll be charged for two months if the invoice should go over by just one day.We charge invoice factoring fees on a daily basis, which means that however many days outstanding the invoice may be, this number of days will be used to calculate the fee chargeable. By this we mean that you won't be charged an extra month of fees simply because your invoice was outstanding for 31 days instead of 30.

 

Please Explain How Invoice Factoring Can Help Grow My Business

 

Today, businesses are choosing invoice factoring over merchant cash advances or bank term loans simply because it's the lowest risk option there is. The fact is, the sale has been completed and the invoice confirmed, so the only thing remaining is for the customer to pay the invoice. Provided you have confidence that your customer will pay your invoice in a timely manner there's nothing to worry about. However, with a bank loan, monthly interest payments can devastate small businesses, start-ups, and even large businesses. And, with bank loans, they either amortize or the total amount is due at the end of a specific period. This kind of debt stress can be devastating for business owners, who are often placed in the position of deciding whether to make bank interest payments, pay rent, or make payroll.

 

With invoice factoring, because you receive cash in-hand for your invoices, there's no stress, and you're free to grow your business in whatever way you see fit. For many businesses the only negative has always been waiting to receive payment on invoices, so now there'll be no more waiting and you'll have cash in-hand to meet your own financial obligations.

 

What Kind of Businesses Qualify for Invoice Factoring

 

Fortunately, it's actually quite easy to apply for and be approved for invoice factoring. With banks and other lenders, profitability, annual revenue, and credit scores can be obstacles to being approved for finance, but these factors typically don't apply with invoice factoring companies.

 

There are three things that invoice factoring companies are usually looking for -

 

-The business must have government or other business customers;

 

 

-Business invoices must be unpledged to other loans and be due and payable within 90 days. This means that you can't have another loan where you're claiming the same invoice as collateral; however, if you do have another loan it must be subordinated (rank after)the invoice factoring company's claim to your accounts receivable;-There should be no history of serious legal or tax issues connected to your business. Note that some factoring companies use a "time in business" or minimum credit score to approve or deny applications; however, we do not.

 

How Can I Choose the Right Invoice Factoring Company for My Business?

 

You've made the decision that invoice factoring may be a good fit for your business, so what should you do next? There are so many invoice factoring companies out there to choose from, so how do you determine which one is the right fit for you? The answer to this question is - very carefully! You need to know exactly what you're looking for. To start with, you're looking for an invoice factoring company that offers more than just funding. There are many factors out there claiming to be the most technologically advanced, the fastest, and the easiest to use, but be cautious. You need to receive good customer service from your factor and be very wary of high fees. Some factoring companies are forced to charge higher fees in order to cover the losses they experience because they underwrite poor quality clients.

 

Excellent Customer Service is a Must!

 

It's very important that a good working relationship be established between the invoice factoring company and the business because, without it, businesses can be left confused as to why their credit facility has been reduced or why certain invoices have been rejected. Great customer service and a personal touch is vitally important when it comes to invoice factoring. If your questions are not being answered in an honest and open fashion, or your calls and emails are not being responded to in a timely manner, then find another factoring company.

 

 

 

 

 

 

Factoring Companies In Mississippi Articles

Business Is Booming but Your Company's Cash Strapped!

 

A business needs good cash flow for many reasons, and many businesses have learned the hard way that business can be booming but they can still suffer from cash flow problems. There are many scenarios where a business might urgently require access to cash: it could be due to the sudden growth or expansion of a business, a major transaction may need to be expanded, perhaps there's a need to purchase equipment or even to employ more personnel.

 

Interestingly, research shows that many businesses (both small and medium-size) fail, not because business is bad, but because they experience difficulties when trying to meet short-term financial responsibilities. So how can a growing and profitable business get into serious financial trouble, or even go broke? It seems so contradictory, but on closer examination you'll see that it's not surprising at all.

 

Many Businesses Experience a Cash Flow Dilemma

 

It's so easy for a business to get into a situation where they have a cash flow problem: you only need one or two larger accounts to default on payment, or to take an additional 60 or 90 days to pay, and now you've got a cash flow problem!

 

Traditionally, business owners have depended on conventional lending sources for a business Line of Credit, and this often includes short-term Bridging Finance. But there are also many people in business who've used their personal credit cards for business-related expenses. Once business owners have exhausted traditional means of funding, the process of acquiring extended financing can become a time-consuming, trying, and often impossible task.

 

Factoring

 

Fortunately, today, we have a viable and effective alternative for business owners to get through cash strapped periods, particularly during periods of expansion and business growth. This innovative form of financing is known as Factoring; it's also sometimes referred to as Asset Based Lending or Accounts Receivable Financing.

 

Factoring has become a workable and realistic solution for many businesses, particularly when cash flow is uncertain and threatens the viability, or even survival, of the business.

 

How Does Factoring Work?

 

Basically, when a business has credit-worthy accounts receivables, the factoring process provides the business with an instant cash injection on those receivables. So, sometimes, when a lender says 'no' to a business, a factoring company may say 'yes', thus offering the much needed cash injection that so many businesses require to move forward.

 

Factoring companies understand the financial needs of their trucking clients and react very quickly to provide them with the professional, personalized, hands-on attention that they require. Freight Bill Factoring is actually a very simple process: it provides a business with instant cash flow in order to satisfy its cash needs, which in turn enables the business to grow and prosper.

 

It works like this! Your company has quality accounts receivables, and needs a cash boost. A factoring company may purchase just one, or a group of your receivables, and in return will immediately give you up to 100% (less fees applicable) of the face value of these accounts. Once the customer invoice has been paid in full the balance is forwarded on. Yes, factoring costs more than other means of lending, but factoring clients believe the benefits far outweigh the costs.

 

The Benefits of Factoring

 

Possibly the greatest benefit of factoring is the short turnaround time, because factoring companies don't have a lengthy loan approval process, unlike banks and other lenders. This means that, with factoring, trucking business owners can have money in-hand by the end of the same working day!

 

In order to receive approval as a factoring customer, a trucking business must first-of-all be a reputable trucking business, and secondly, it must have credit-worthy customers. Once a business has been approved for factoring, funding will be provided on the same day. It's important to note, also, that ongoing financing is only limited by the amount of receivables available for purchase.

 

In the last decade we've seen factoring grow very quickly, and today it's become a financially feasible alternative for many trucking companies. Many trucking companies have stated that Freight Bill Factoring has made it possible for them to process orders and undertake loads from brokers that would otherwise have been impossible because of a lack of financing. Freight Bill Factoring is here to stay, and it clearly has a place in today's business environment. Because of factoring, a trucking company can expand its customer base, increase loads, and even survive a seasonal slump. Thanks to Freight Bill Factoring, many businesses have been able to expand and grow, and easily survive in what has become a very competitive industry.

 

 

 

 

 

Factoring Companies In Mississippi Articles

Medical and Healthcare Invoice Factoring

 

Don't Wait to Be Reimbursed - You Can Receive Payment Today!

 

Anyone in the healthcare profession is painfully aware that third-party payers like Medicaid, Medicare, HMOs, Workers Compensation, and other private insurers, can take what appears to be an unnecessary long time to settle your accounts. But there's good news, because with 'factoring' there'll be no more long waiting periods to receive payment on your medical receivables. For anyone in the healthcare profession who provides any type of medical services, factoring is here to assist with cash-flow.

 

Is There a Difference between Medical Factoring and Healthcare Factoring?

 

There actually is a difference between these two types of factoring, even though we hear many people using these two phrases interchangeably. Basically, when there is no third-party payer involved, then healthcare factoring applies, and if a third-party payer is involved, then medical invoice factoring companies are used.

 

Healthcare and medical receivables factoring is available for the following services -

 

- Hospitals

 

- Group and Sole Practitioners

 

- Laboratories

 

- Physical Therapy and Rehabilitation Facilities

 

- Chiropractors

 

- Nursing Homes

 

- Durable Medical Equipment (DME)

 

- Medical Staffing Companies

 

- Medical Billing Services

 

- Medical Supply Companies

 

- Medical Coding Services

 

- Ambulance Providers

 

- Medical Transportation

 

- Medical Transcription Services

 

- Medical and Non-Medical Home Healthcare Providers

 

- Imaging Facilities Providing CT Scans, X-Rays, MRIs, and so on; and

 

- Many More!

 

Factoring for Healthcare Receivables

 

We typically associate healthcare receivables with customers who are not reliant on third-party payers. This includes sectors involved with medical staffing, medical supplies, medical transcription, medical coding and billing, and so on. Basically, it means that vendors who use healthcare factoring receive the benefits of an unlimited line-of-credit, all based on the services they provide.

 

 

You can see below that factoring healthcare receivables is a very simple process -

 

 

- As the healthcare vendor, you still invoice your customer for work you've completed. Some of the more common customers will include medical offices, nursing homes, hospitals, and so on.

 

- The next step is for the vendor to forward a copy of the invoice to the healthcare factoring company. Your factor will handle the collection of payment on your behalf.

 

- The factoring company will deposit an amount of money in the range of up to 85% of the gross value of the invoice into the vendors bank account within 24 hours, or less.

 

- The remaining (approximately) 15% will be held by the factor until such time as the account has been paid in full by the customer.

 

- Once the invoice has been paid in full by the customer, the factor will release the remaining 15%, less the agreed-upon fees, back to you, the vendor.

 

Factoring for Medical Receivables

 

Regardless of whether your business bills Medicaid, Medicare, Blue Cross/Blue Shield, a third-party insurance company, or HMOs, we have the perfect factoring solution for you.

 

The benefit to you of factoring your medical claims is that you'll receive upfront capital. It's the factor who will seek payment of your invoice.You can see below that factoring medical claims is a very simple process -

 

 

- As the provider, you'll continue submitting your claim to the third-party payer.

 

- At the same time, you'll submit a copy of the paperwork to your factoring company.

 

- The factoring company will deposit an amount of money in the range of up to 85% of the net collectable value into the vendors bank account within 24 hours, or less.

 

- Once the third-party payer pays your claim in full, the factor will release the remaining 15% (approximately), less the small agreed-upon factoring fee.

 

 

 

 

Factoring Companies In Mississippi Articles

Important Points to Remember When Choosing Your Factoring Company

 

Now that you've decided that factoring would be a solid business decision for your company, the next step is to find the perfect factoring company for you. Once you start looking you'll discover that there are many factoring companies (or 'factors') in the marketplace, and this is the perfect situation for you as a potential factoring client.

 

But it can also be confusing, because now you have to find the right factoring company to suit your business's needs. To assist you in making the right decision we've listed below the main issues that should be considered when choosing a factoring company.

 

Factoring Fees and Terms

 

Before making your final decision and entering into a factoring agreement, check out the fees applicable and the terms of the contract. Both of these can vary a lot, depending on the factoring company and the industry it's serving. When you start your research you'll discover that some factoring companies charge a flat fee: this fee is, in effect, a certain percentage of the total value of the customer invoices you sell to them; whilst others have additional charges to cover the general costs of doing business - such as, money transfers, shipping, collateral, and so on.

 

Ensure that the factoring company you're considering working with is transparent and upfront with you about its fee structure. In addition, you may want to consider a long term contract with your factoring company if it includes flexible rates or a price break. If you're receiving competitive offers from other factoring companies or you have increased factoring volume, you'll discover that many factoring companies will be prepared to adjust their rates. A one year contract is the industry standard for most factoring agreements. Generally, unless you give your factor a 60 or 90 day notice, your factoring contract will automatically renew.

 

What's the Difference between Recourse and Non Recourse Factoring?

 

It's important that you understand the difference between recourse and non recourse factoring prior to choosing your factoring company, because you need to know what the best fit would be for your company and your customers. So, with non recourse factoring, all of the credit risks for the collection of the invoice belong to the factoring company; while recourse factoring means that, with you being the client, you'll ultimately be responsible if the factoring company is unable to collect payment on your customers' invoices.

 

There are benefits to recourse factoring, and perhaps the main benefit is that it's less expensive than non recourse factoring. If you have a recourse agreement and the customer defaults on payment, it doesn't automatically mean that you'll be asked to settle the debt out of pocket. Generally, what happens is that the factor will hold back a portion of either future cash advances or payments being held in reserve, with the money being placed in an escrow account awaiting settlement of the debt.

 

Our suggestion is that you find a factoring company that offers both recourse and non recourse factoring, because not all of your customers will be good candidates for recourse factoring. An experienced factoring company working with a strong credit team can also behelpful in ensuring you're working with good customers: this will relieve some of the pressure of being stuck with bad debt.

 

Experience and Capital: The Two PreRequisites

 

Your company should be looking for a factoring company with experience in your industry, including the capital structure to fund your business as it continues to grow. Once you start researching factoring companies you'll discover that there are a lot to choose from; however, many of these are recent start ups with limited experience. Prior to signing any factoring agreement, do your research and look into the history and background of the factoring company concerned, especially its ability to provide financial services in your area of expertise.

 

The idea with factoring is that, as your company grows, the funding of your customer invoices will grow with you.Research the factoring company's client base and their capital structure. What's a typical account size? What's the factoring volume of their largest client? Is the factoring company limited to how many debtors it can handle? In general, factoring companies that have been serving your industry for many years will usually be able to offer your business the best deal.

 

Additional Factoring Services

 

There are many more benefits to factoring than simply increasing your company's cash flow. Because the factoring company will be handling the collection of your customer's invoices, your company will be saving time and resources. A good factoring company will also be able to evaluate companies in your industry and provide credit information. In short, your factor will ensure that you experience excellent customer service. You'll be matched with your own representative who'll be able to address any questions or concerns you may have about your factoring account.

 

So, when researching factoring companies, look for a factor who not only offers additional products but provides a high level of customer service that will help your business grow by assisting you in making smart business decisions.

 

 

 

 

 

Factoring Companies In Mississippi Articles

Growing Your Trucking Company Just Got a Whole Lot Easier

 

There's a lot of hard work and dedication involved in growing a successful trucking business, but perhaps above everything else a disciplined approach to making the right decisions and taking the right actions is required. The aim of this post is to help both small fleet owners and owner-operators accomplish these goals.

 

The three key steps to building your trucking business are to grow your fleet, find profitable shippers and loads, and the successful day-to-day running of your trucking company.

 

The 1st Step: Growing Your Fleet

 

You won't be able to grow your trucking company unless you have the right equipment. But, securing finance to purchase this equipment can be very difficult, and this is where many truckers run into trouble. Today, there are several financing options for owner operators of trucking companies, and even those with less-than-stellar credit are typically able to achieve some sort of financing.

 

There are two more-commonly used financing options - the trucking company either leases a truck or it gets a loan to purchase a truck. There are various ways of structuring leases and loans, and each option has its disadvantages and advantages. Your final decision will be determined by its merits, your objectives, and your available resources.

 

We strongly urge you to consult with a CPA with expertise in trucking when considering financing. It's true that a visit to a CPA could cost around $150, but not only will they help you determine your best option, they could also save you a lot of money in taxes. In fact, it's critical that you seek a CPA's advice if you're planning on growing your fleet. This is not an expense you should try to avoid.

 

The 2nd Step: Finding Profitable Shippers and Loads

 

Possibly the hardest part of running a trucking company is finding quality shippers and loads. Many owner-operators use a loadboard to find loads, and this approach does have its advantages. Perhaps the main advantage is that the loadboard allows you to match your equipment and preferred routes with loads. Unfortunately, though, loadboards are not financially worthwhile for truckers in the long term. To start with, loadboards are highly competitive, particularly for the most popular routes, which means you'll be forced to charge low per-mile rates. Now the trucking company must become very vigilant and ensure the load they're pulling will end up being profitable. The second reason using a loadboard is not viable in the long term is that your company doesn't get to grow relationships with shippers. This means you'll always be working with new customers, which can be a time-consuming process.

 

The best strategy for owner operators is to only use a loadboard as a starting point, but persist with making sales calls so that eventually you'll start building relationships with direct shippers. Statistics show that trucking companies with shipping relationships are earning approximately $20,000 per truck/per month; whereas trucking companies who rely on loadboards are earning approximately $10,000 per truck/per month. That's a big difference! As you can see from these figures, building good and lasting relationships with shippers can double your revenue. Therefore, the best way to grow your trucking business is to develop solid relationships with shippers.

 

The 3rd Step: The Day-To-Day Running of Your Trucking Company

 

All too often we see small fleet owners and owner-operators struggling with the day-to-day running of their trucking company. There's a lot of paperwork and related coordination that's involved in moving loads and running a trucking office can be very exacting and tedious. But, it's a necessary task and it's an important one.

 

If you're determined to grow your trucking company, it's critical that you employ both time-saving and money-saving processes. Managing a small trucking fleet is entirely different to managing a single truck operation. We strongly suggest you approach experienced truckers for advice and, providing you're not in competition with them, you'll generally find that small fleet owners are more than happy to share their expertise with you.

 

Managing Cash Flow

 

Managing cash flow can be a serious issue for trucking companies. It's fairly common for new truckers to experience cash flow problems when they first get into the trucking business, and the reason for this is very simple. Cash flow problems occur because most shippers settle their accounts in 30 days, 60 days, and some even wait 90 days. In the meantime, however, you've got your drivers to pay, fuel to purchase, machinery to repair, payroll to meet, and other necessities to take care of. The delay in receiving payments due to you can cause serious problems for any business that doesn't have a large cash reserve. Simply speaking, you run out of money, and without money your company will be stuck. Until such time as your shippers pay your invoices there'll be no more loads, no mechanical repairs, no meeting payroll, and so on.

 

How to Resolve Your Cash Flow Problems

 

Fortunately, there's a very simple answer to the question of cash flow problems. Today, many trucking companies are resolving their cash flow issues by factoring their freight bills. Freight factoring has become a popular way of financing new trucking companies because factoring provides trucking companies with an advance on their slow paying invoices. The result - no more cash flow problems! Now, instead of having to wait 30, 60, even 90 days to get paid, you'll be paid by the factoring company once the load has been delivered.

 

Receiving upfront payment on invoices gives trucking companies the money they so desperately need to cover the day-to-day running costs of their business, with money left over to grow their business. You'll also find that fuel advances are often offered by many factoring companies. This is an add-on feature which provides the trucking company with funding when they collect a load. These funds come in very handy for paying fuel costs and other delivery expenses.

 

 

 

 

 

Factoring Companies In Mississippi Articles

Factoring

 

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trucking factoring companies
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As the owner of your own business, you may be more than aware already of the difficulty in making sure that cash flow issues do not become a problem down the line. After all, the worst thing that can possibly happen for your business is to find yourself embroiled in a long and difficult situation that leaves you forever trying to find two pennies to rub together.

 

For any business in this situation, the problem can come for waiting for work to clear up and actually be paid into your account. Invoices, cheques and the like can take some time to actually processed which can leave you with short-term cash flow issues. Thankfully, there are options out there for businesses to look into - and one of these is factoring companies.

 

Factoring companies will, in exchange for your invoices, provide you with the cash today so that you don't need to worry about the waiting period that could make paying the bills and getting materials more difficult. With this type of setup, invoice factoring can become incredibly useful for many businesses who need to get out of a cash trap which they have found themselves in.

 

Because, depending on the size of the job, it can take up to 60 days for some businesses to get paid then it's important to cover your own back and not leave yourself short in that day. after all, how many businesses have two months revenue just lying there to cover all the losses until they get paid?

 

This is especially true of trucking companies. They tend to deal with lots of invoices which means a significant amount of running around and donkey work for the business owner themselves. Trying to get paid in time can become an incredible hassle and this is why you get specific trucking factoring companies who are happy to help out truckers specifically.

 

As we all know, trucking is an incredibly large industry with many companies out there employing hundreds of drivers. Unfortunately, many of these drivers can spend night in the cold or hungry as they are still waiting for work from six weeks ago to actually pay them. When this is the situation for a trucking company, turning to factoring companies for assistance might be the best choice left.

 

This means that a trucking company can pay the wages of the staff, keep all the vans topped up with fuel and continue to scale, grow and expand without always waiting for the never-never with money which is taking forever to arrive coming in. businesses running without a factoring model put in place are leaving themselves in significant risk, as competitors cash out fast and continue to expand.

 

There's genuinely nothing to be worried about when it comes to using a Factoring company - they aren't like a payday loan firm or somebody who is going to leave you with a huge pile of debt to apy back. Although you are technically borrowing a loan, so long as you only ever give them genuine invoices from work you have already finished you are merely speeding up the payment process.

 

In the United States, where trucking companies thrive, factoring companies are not considered borrowing in any capacity. This confidential agreement then allows both parties to profit and enjoy a comfortable future - it gives the factoring company a guaranteed asset of income to add to the list and it gives the trucking firm a wad of cash that they worked hard to earn.

 

The trucking company will usually need to pick up the invoice and cash it in still, and then make the payments back to the factoring company. Because it's a confidential agreement, and it can look bad for a business to be involved in this type of short-term finance even though it's perfectly legal and a very common practice, it's usually in the hands of the company to get the money for the factor.

 

This is an extremely old business type and has been used for many years by many different types of work - but none more so than truckers. While you may miss out on a small part of the money , something like 15% depending on who you work with, it means that you are getting the money today and can actually start putting some food on the table.

 

After all, an IOU or an invoice is not going to be you fed and washed, is it? For trucking companies when the money can be good one day and gone the next, it's up to the drivers to work sensibly and to ensure they are leaving themselves with a significant amount of time and finance to get through the week until they are paid again.

 

So the next time your trucking business is having some short-term cash flow issues and you are spending too much time chasing up slow paying clients, why not start considering to use factoring businesses as a way to change your motive and give yourself a more comfortable future in the eyes of your trucking staff and your bank balance?

 

 

 

 

 

Factoring Companies In Mississippi Articles

Medical and Healthcare Factoring

 

Receive Payment Today! No Waiting Weeks for Reimbursement!

 

It's certainly no secret that Medicaid, Medicare, HMOs, Workers' Compensation, and other private insurers can take a LONG time to pay your invoices! But now there's good news for healthcare professionals! Now you don't have to wait weeks, sometimes months, to collect on your medical receivables. If you're a healthcare professional and you provide medical or healthcare-related services of any type, we're here to help you!

 

The Difference between Healthcare Factoring and Medical Factoring

 

Healthcare factoring and medical factoring are phrases that are often used interchangeably, probably understandably, but there is a difference between these two. The difference is that healthcare factoring applies when there's no third party payer involved, while a medical factoring company is used when there is a third-party payer involved.

 

Healthcare Factoring and Medical Receivables Factoring are available for the following healthcare providers -

 

- Group and Sole Practitioners
- Physical Therapy and Rehabilitation Facilities
- Hospitals
- Chiropractors
- Laboratories
- Durable Medical Equipment
- Medical Coding Services
- Medical Billing Services
- Medical Supply Companies
- Medical Staffing Companies
- Medical Transportation
- Medical Transcription Services
- Ambulance Providers
- Nursing Homes
- Imaging Facilities, such as providers of X-Rays, MRIs, CT Scans, and so on
- Home Healthcare Providers - both Medical and Non-Medical,
- And more!
Healthcare Receivables Factoring

 

Generally, healthcare receivables are associated with customers who are not third-party payers. Some common healthcare sectors include medical staffing companies, medical transcription services, medical billing and coding services, and medical supply companies. When these vendors utilize healthcare factoring they're free to enjoy the benefits of an almost unlimited line of credit - all based on the services they've provided. A simple explanation of factoring healthcare receivables is as follows-

 

- When work has been completed, the healthcare vendor will invoice their customer.
- These customers may include nursing homes, hospitals, medical offices, and so on.
- Next, the vendor will forward a copy of the billing documentation to the healthcare factoring company.
- Within 24 hours, sometimes even less, the factoring company will deposit money into the vendors bank account. The amount deposited will generally be around 85% of the gross value of the invoice.
- The factoring company handles collections on behalf of the vendor, and will retain 15% while awaiting payment.
- Once the invoice has been paid in full, the factor will release the 15% - less their factoring fee - back to the vendor.

 

Medical Receivables Factoring

 

- Regardless of whether you're billing Medicaid, Medicare, HMOs, Blue Cross/Blue Shield, or third-party insurance companies, we have the perfect factoring solution for you. When you start factoring your medical claims you'll achieve instant benefits by receiving upfront capital; while the factor may have to wait months for your customers to settle their accounts. A simple explanation of factoring medical claims is as follows-

 

- The healthcare provider submits claims to the third-party payer, as usual.
- A copy of completed paperwork is then submitted to the factoring company.
- Within 24 hours, sometimes even less, the factoring company will deposit money directly into the medical provider's bank account: the amount deposited will typically be around 85% of the net collectable value.
- Once the claim has been paid in full by the third-party payer, the factoring company will release the remaining 15% - less their factoring fee.

 

 

 

 

Factoring Companies In Mississippi Articles

Bookkeeping Mistakes Commonly Made by Freight Brokers

 

It's true that freight brokers shoulder a lot of responsibility; from matching shippers and carriers, to ensuring that each and every piece of cargo arrives at its proper destination. Freight brokers also have the added responsibility of accurate bookkeeping, because failure to prioritize bookkeeping can result in the loss of money.

 

Below we've listed some common bookkeeping mistakes made by freight brokers, and how to avoid them-

 

Handling the Accounting In-House

 

Many business owners try to save money by handling the books themselves, or perhaps delegating this very important task to a family member or an inexperienced employee. Sure, you may save time and money initially, but errors can be costly: when you attempt DIY accounting you could well end up with more expensive financing terms, higher bond premiums, or a number of other unforeseen expenses. It's very important that you hire a competent bookkeeper because, not only will you save money, but you'll know that the job will be done accurately, quicker, and more efficiently.

 

We understand only too well that running any business is time-consuming and hard work, and many freight brokers are simply too busy doing their day-to-day tasks to focus on bookkeeping tasks, such as the monthly reconciliation of credit card accounts and bank accounts. It's through reconciling statements that you get a clear idea of how much credit or cash you actually have, and you can also pick up on any errors that may have occurred.

 

It can be so tempting to postpone this rather tedious task, but the truth is that your credit card statements and bank statements must be reconciled every month, preferably the moment each statement becomes available. In this way you'll be able to identify any potential problems in a timely manner; problems such as lost checks, missing deposits, fraudulent charges, and so on.

 

Failing to Track Invoices and Receivables

 

You're not going to get paid if you're using poor accounting practices with your accounts receivable. Let's face it, getting paid equals cash, and cash is the lifeblood of every business. An experienced freight broker understands that your cash flow can be strained by the delay between when you pay your carriers and when you receive payment from your customers. If you're finding that tracking and collecting invoices is taking too long, why not consider invoice factoring? An invoice factoring company will purchase your invoices for a small fee, with the bonus being that you get paid immediately, plus you're spared the time and expense of having to deal with collections.

 

Don't Forget Liabilities

 

One of the major considerations a surety has when looking at your business financials in order to underwrite a bond is whether you have sufficient assets to cover your liabilities. Many times we see an inexperienced bookkeeper recording a liability, but when the payment is made they forget to reverse the liability. This is a serious error because it results in liabilities being overstated and net income being understated, which makes your business appear to be less financially secure than it really is. These serious errors can be avoided by employing the services of an experienced bookkeeper. We also recommend that you have another set of eyes (which may be an owner or a CPA) regularly review the balance sheet to check for unusual account balances

 

Too Many Expense Categories

 

Another common error we often see with inexperienced bookkeepers is creating too many expense categories, or miscategorizing expenses. Generally, most industries and businesses have a standard set of expense categories, and when a loan underwriter or surety sees too many categories, or the miscategorizing of expenses, it stands out like a big red flag. It tells them that your books are not well prepared. Use an accountant or experienced bookkeeper to correctly set up your accounting software right from the beginning, and don't automatically add new expense categories unless careful consideration has been made. Remember to ask your accountant or CPA for advice, because they'll be able to guide you on how to classify expenses.

 

Incomplete Information on Invoices

 

It's very important that, when you invoice your customers, you provide sufficient detail on each line item. Do you invoice by weight, per piece, or per mile? Or is the charge a flat fee? If there are additional charges to invoice, such as reimbursements for fuel or fees, these should be listed as separate line items. In addition, these charges must be clearly and accurately detailed in order to avoid any confusion. When you send invoices to your customers that include clear and concise details, it prevents pushback from your clients. If there's missing information on your invoices and your customers are confused by unrecognizable charges, it could well cause a delay in payment, which is the very last thing business owners need.

 

Not Understanding the Functionality of Accounting Software

 

Many freight brokers purchase an accounting software package because they're anxious to get their business up and running, but they fail to learn how to use it correctly. This is probably not an issue if you're already outsourcing your accounting and bookkeeping tasks; but if you're using this software in any way at all, perhaps to enter checks and run reports, it's important that you spend some time learning how to use all the available functions. When used correctly, the right accounting software can save you a lot of time, in addition to providing real-time information on the state of your business. It's this information that helps you make important business decisions!

 

 

 

 

 

 

Factoring Companies In Mississippi Articles

How Factoring Saved A Staffing Agency

 

The Bellosa Temporary & Permanent Hiring Agency has been experiencing a major uptick in business since the unemployment crisis began. The unemployed and underemployed workers have been keeping the phones ringing. The staffing agency is also fielding a lot of calls from employers too, looking for just the right hire. Company President and Vice President, Laurie Bell and Ted Stevens, have not experienced a boom in business since they first opened the doors in 2009, during the recession. They had an idea then that this would be a profitable venture.

 

The mantra that Laurie and Ted live by is that there "s always going to be people searching for work and of course employers will always be on the lookout for good workers. This is especially true in healthcare staffing, the industry they specialize in. This seemed to be a safe bet for them as they embarked on this venture, but with any small business, the only way to keep the doors open is to keep pressing forward and out perform the competition.

 

In a relatively short period of time Laurie and Ted had built a nice sized business, they were able to hit the ground running with some brilliant marketing programs and a number of contracts from insiders. They grew rapidly, the timing couldn "t have been better and they were very lucky in this aspect. By the fall of 2011 Laurie and Ted had weathered some ups and downs but they did have some solid clients like a few big insurance companies and a university hospital close by. These clients always paid their invoices on time. But they did start to notice a decrease in accounts receivables from some smaller clients such as rehab centers and private practices.

 

As winter approached they recalled previous winters and holiday seasons and realized that accounts receivables usually did slow down during this time. Laurie and Ted made the decision to delay their late payments until after the New Year. This plan didn "t really appeal to them as it "s no way to start a New Year, but they seemed to have no other options.

 

When New Year "s had come and gone they realized that their Accounts Receivables had gone from 30 days past due to 60 days past due. Before meeting with their accountant Scott, they "d decided something had to be done, but they didn "t know what.

 

Sitting in the conference room with Scott they listened as pulled all the figures up on his iPad saying,“Okay you two, I "ve been looking over the files you sent over and I can certainly see why you "re worried about your late A/Rs but there may be a way to fix this. Do either of you know what factoring is?” Scott inquired.

 

Laurie and Ted looked at each other quizzically, and then Laurie said “I think it rings a bell, but I "m not really sure. Can you explain it?”

 

Scott began laying out the details, “You are sitting on a pile of invoices that are past due. The more time that goes by without them being paid, the bigger the bind this puts your business in. It makes it very difficult for you to grow, much less hire anyone new. If you don "t have enough cash coming in . ”

 

Ted interrupted with, “Then it could make it difficult to take on any new business because we wouldn "t be able to hire the additional personnel we need and meet our weekly payroll. We need an inflow of cash and we really can "t wait. If we have to wait any longer on these invoices we "ll be in trouble.”

 

Scott jumped in saying, “And this is precisely why I wanted to discuss factoring with you. The factoring company will purchase the invoices you are sitting on that are up to 3 months late, which gives you the cash you need now.” He then showed him a chart on a piece of paper he placed in front of them.

 

Laurie began to carefully scrutinize it asking, “Is this the fee schedule?”

 

Scott answered, “Yes it "s all right there. The factoring company makes 1% to 3% of the total amount of each invoice they purchase.”

 

“That "s sounds like a good deal to me”, Ted said.

 

The three of them sat there and talked this over for a while and then Laurie and Ted made the decision to go forward realizing this was the best way to keep them afloat. They knew if they couldn "t accommodate all the new clients they were acquiring the competition would get them and they would go down, they could just not afford to turn any business away.

 

They now needed to fill out an application and submit it to the factoring company and they also needed to show them a few back invoices, undergo a credit check for their company. Credit checks would also need to be done on the companies owing the debts that the factoring company would be purchasing.

 

It didn "t take long for Bellosa "s credit to be approved and the creditors " as well. Before long the factoring company purchased the overdue invoices and Laurie and Ted got the influx of cash they needed to cover things and allow them to continue growing their business.

 

The next time Laurie and Ted met with their accountant Scott, there were smiles all around.Scott said, “I "ve taken a look at your books so I know that factoring was the right solution for you.”

 

“It worked perfectly”, Laurie stated and went on to say, “The tiny amount we paid out for this influx of cash was certainly worth it.”

 

Ted chimed in with, “Without a doubt! Whatever the fees were we made back and more since we were now able to hire more personnel so we could take on more business. It worked out for us and for them I would say!”

 

“That "s what "s great about factoring!” Scott exclaimed with a look of satisfaction on his face.

 

 

 

 

Factoring Companies In Mississippi Articles

Discovering Trucking Factoring

 

Lambert Truck and Haul has been in business since the mid1980s. They've delivered goods for nearly every major industry in the nation and for 20 plus years, business was booming as they've traversed the country in all weather for all clients. During the heady times from 2002 to 2007, Lambert was a top rated accounts receivable mastermind of the trucking industry. Few customers were ever late on bills and those clients who were, were sure to turn in their late payments within a reasonable amount of time. Cash was flowing and times were good for all.

 

But a short year later, in the fall of 2008, when the United States economy took a nosedive and businesses both small and large began to feel the pinch on their pocketbooks, those that used to make their demands had suddenly and largely gone silent. Business slowed down. And worse yet, Lambert had noticed during the early part of 2008 that though the bulk of their clients were always on time with payments, the few late-bloomers there were, had seemingly started to spread this illness. And as spring turmed to summer and summer into the early days of fall, John Rondstadt, CEO of Lambert felt a chill go down his spine whenever he would look at the weekly A/R reports. The numbers of clients who owed him back debt were growing.

 

He had gone to his administrators and asked them what the problem had been. Were they doing something wrong or different when it came to reaching out to delinquent accouts? By his bookkeepers records, this wasn't the case. He thought perhaps that he was losing clients to a competitor who offered rock-bottom prices with little to no guarantee of quality performance and the folks who owed Lambert money had jumped ship and decided to leave him holding the bag. They couldn't afford to pay him their debt, but they could afford a lesser service, maybe. But after doing the cursory research for this and talking to friends in the field, he found that alas, no, customers of Lambert hadn't gone elsewhere. They had just gone home.

 

The situation looked dire to John Rondstadt. He had employees to pay, goods to ship, trucks to maintain and overhead that was almost unbearable when compared against the lack of funds that were coming in. At night he would speak to his wife Linda and shake his head in frustration. "I have a bad feeling, Lin," he would say with deep woe."Well, what do you think it is?" she would ask.

 

John would stare off for a moment and then close eyes. He could see the fleet of trucks he had purchased over the years. He could see them traveling, bringing goods to all of his clients. But somewhere, a haze would form over his fleet and the vast number of vehicles would disappear to but a few. What could cause this ultimate death spiral of business?

 

"I know what it is," John said. "I've relied too long on the profits I receive from invoices alone. I've let too many of our customers go too long without paying on their bills."Rhonda could only grab her husband's hand and look at him lovingly, "It's a hard economy. It might be awhile until things get settled up."John knew his wife meant well, but he knew that he was responsible for too many people to sit idly by, waiting for the sun to peak over the clouds.

 

The next day John strolled into his office and was determined to sit down and make every phone call to every client who had owed Lambert money. Now, it wasn't the most efficient way to spend a day as a chief executive, what he really needed to be doing was to be overseeing all of the other intricacies of shipment and delivery and reaching out to prospective clients or retraining his sales team to do the same. Even though he was doing something to help his company, he knew he had folks on salary to do just this thing. Wasting money, wasting time - even with the best of intentions, John knew that he was in trouble.

 

After a half day of contacting debtors in vain - they dodged his calls or promised to call back at worst or made minimal interest-only payments at best - he was about to throw in the towel when his secretary Beverley knocked at his door."John, can I have a word?" she asked standing in the doorway.

 

"Sure thing Bev, come on in." John leaned back in his chair and looked expectantly at Beverely. "Well, I did a little searching this afternoon and tried to figure out a way out of this mess John." She pulled a small stack of papers from a folder and set them on the desk before him. "Have you ever heard of factoring?" Beverley asked."It sounds vaguely familiar. What is it?" he said. "Well," she began, "Its actually quite simple really. So basically, factoring invoices would enable us to get paid on the nose for loads that we haul.""Immediately?" John interrupted.

 

"Yes, immediately," she continued, "In a nutshell, it's pretty easy. We can have an expert account manager review our numbers and help us complete a company profile. That profile will also include investigating our accounts receivable aging reports, our existing customer credit limits and so on. Additionally, the factoring will help to determine the creditworthiness of our customers independent of their credit history with our business. It's a broad view."

 

"I see," John said. "And then what?""Well, after their review, and we're approved for a factoring contract, we can negotiate terms and conditions. There's a lot of flexibility depending on the business volume and credit histories. This company tells us what the cost will be to purchase factoring for our accounts receivable. We come to an agreement and the funding starts pouring out."John leaned forward and reviewed the paperwork closely.

 

"It sounds too good to be true, Bev," he said. "Now, now, I know, I thought the same thing. But really, they have guaranteed us experts that do all the legwork, which would free us up here to focus on our clients in good standing and marketing, all that good stuff. And they're flexible John," she underlined a paragraph on the paper before him. "How flexible?" he asked. "They personalize the factoring rates so that the amount they are willing to take on is commensurate with our needs and our client's debt. It only takes 2 to 4 days for this to be figured out.

 

"That sounds pretty good, seeing as we tapped ourselves out with bank loans last year to repair the fleet and money sure is tight. We need to keep business rolling as normal and every day we're going unpaid, we're closer to facing some serious problems in both the short and long term," John said.

 

He took a deep breath and looked at his secretary with something she recognized as hope."Exactly". I think this might just be a way out of the trouble we're in with these folks who owe us money."John thought about this and agreed with Beverley. The clients who owed them money were long standing friends and professional resources of Lambert. They didn't want to throw away these relationships because they were having trouble paying their bills now. John knew that the economy had taken a hit and he knew that it would probably be a long time before things started to look up again. That unknown amount of time, if he handled these debtors incorrectly, could spell disaster for both of them. He didn't want to lose business but he also didn't want to lose any more money.

 

"Well, let me think about this tonight Bev, thank you." Bev nodded, stood up and left the office feeling that she had helped her employer keep on his shirt and hers too.John sat behind his desk and looked over the details Bev had not mentioned in their meeting. What other issues could freight factoring help Lambert with? With his pencil gliding down the sheet he noticed that the factoring company could help fray the cost of fuel with fuel discount cards and fuel advances. In fact, Lambert could receive up to fifty-percent cash advances upon load pick-ups. As a man who hated binding contracts with no room to breathe, he was pleased to see that this factoring company would not make him sign a long term contract, would not make him pay any sign up fees and there was no minimum volume required.

 

"Well, I'll have to tell Billy about this," John muttered to himself.His son-in-law Billy had liked the idea of Lambert so much and revered his father in law for having such business acumen that only two years before, he had gathered the venture capital to begin his own transportation service company. John knew then what struggles Billy would face but he encouraged him nonetheless. With the faltering economy, if a big fish like Lambert was hurting, a little guy like Billy was about to catch his death. But, an antidote may have been found in freight factoring and John was soon to find out. A few months later after going through the entire application process and having the experts review his accounts receivable, credit history and statements, John found himself beginning to dig his way out of the hole his delinquent account holders had created for him.

 

They took on reasonable factoring purchase contracts and stopped spending their precious man hours scrambling to collect debt. They took that time and refocused effort to offering competitive prices in new territories. John looked back on the dismal months of life before freight factoring and almost shuddered at the thought. Had he missed the boat on this one, he probably wouldn't be in business today.

 

 

 

 

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