What is Freight Factoring?

Owning and managing any type of Freight Company isn’t easy. During most days, the owner can end up managing many different roles from owner, manager, accountant, marketing and even HR to name a few. Due to juggling so many things, it’s easy to let something slip through the cracks. That’s where freight factoring comes in. It’s a financial service that helps increase cash flow, allowing the owner able to handle other things in the business without letting something fall through.


Freight factoring is when a trucking company sells the invoice for a load they’ve hauled in order to get cash immediately, instead of waiting however many days it’ll take for a broker to pay. Since this will speed up things for the hauler, the factoring company will take a percentage of the invoice as a fee, but factoring is one of the most common ways that trucking companies improve their cash flow. This happens often in new companies that are trying to replenish startup cost.


Cash flow is the main objective with Freight factoring.  Because of cash flow this keeps a trucking company in business. Freight factoring is about always having ready funds for fuel, payroll, repairs, and more. Factoring is an easy way to manage cash flow for your trucking company.


Freight Factoring can have multiple benefits on a business such as no long term contracts, no sign up fees, no minimum volume requirements and more!


Each Freight company should ask themselves is freight factoring going to produce a good outcome for their company as a whole. Here are a few questions that could help an owner decide if truck factoring would be a good fit for them.….

  1. Do my customers take a long time to pay me?
  2. Is the lack of cash flow negatively