Will a Factoring Company allow me to factor Direct Shippers?

Talking to the factoring company I'm going to use today about that. He said the main difference is that some shippers do not have anything like a rate confirmation sheet, so that you need to provide something that indicates the rate - a contract, something to send in with the invoice & pod. Otherwise, think it works the same, from what he said.

 

Call your factoring company Before you Haul The Load

 

Invoice factoring is not unique to the transport industry. DOT number enables a lookup and validation of a freight broker. For a direct shipper a name and address will usually be sufficient for them to search a credit database and make a decision.

 

For the most part yes, but you will need to get each shipper approved by your factoring company. When I work with shippers for my drivers that is the most important question, how long to pay and if my guys can't wait then we go with the factoring option. In the produce world, many little produce houses are more questionable than the bigger warehouses but I haven't run into any problems with anyone yet. I have found that there are more issues with brokers than with shippers to tell you the truth.

 

I used Freight Capital when I got started, but no longer use a factoring company. Yes you can factor shippers.
The factoring company needs to do a credit check on the shipper. They check to see if any debt it outstanding and what there credit rating might be.
But you have to call before you haul, if you want to get paid for it. A lot of different factoring companys out there, so each one is different.
Make sure you get a BOL signed and maybe printed by someone on the shipment, that will hold up in court if they don't pay. You can get them at Staples.

 

Some direct shippers offer "quick pay". One in particular that I work with regularly pays immediately, which is really nice. Another that I work with is 15 days to pay and yet another shipper I know of is 90 days out... Brokers can factor their invoices from shippers.. so no matter what, you get paid quickly. But factoring will cost you a percentage obviously, so if you can get direct freight.. cut out the broker, you are still way better even factoring in the factoring.. lol!!