In the year 2018, e-commerce has absolutely exploded and placed a high-priority on shipping and invoices. Now, businesses that provide deliveries may potentially struggle due to unpaid invoices which will absolutely sink any business. Thus, load factoring companies are now used to help prevent this from happening and are a sure-fire thing of the future!
Right now, there are nearly 28 million small businesses in the United States. However, this number of businesses is unable to provide proper employment numbers due to invoice problems, which load factoring companies try to help with. Understand that recent estimates show that if all invoices were paid on time, United States small businesses could collectively hire 2.1 million more employees, which would reduce unemployment by 27%.
According to the Federal Motor Carrier Safety Administration, approximately 5.9 million commercial motor vehicle drivers operate in the United States. There could be more if businesses looked to the help of the top transportation factoring companies for help with invoice funding. Here are all of the facts and more:
Load Factoring Companies Help With Cash Flow
When a business or worker provides a service to someone, they will send an invoice. This invoice is basically a payment for said service and helps the worker receive the money that they are owed. However, many businesses really struggle when it comes to getting invoices paid due to the structure of transportation. Therefore, the work of truck factoring companies can really help out the average business.
Invoice factoring is a type of accounts receivable financing that converts outstanding invoices due within 90 days into immediate cash for your small business. There are more businesses than not that will end up suffering due to this period of time in which invoices are not properly paid. So it is essential that anyone dealing with freight transportation find great freight factoring companies.
Load Factoring Companies Help Businesses Succeed
Nearly 12 million trucks, rail cars, locomotives, and vessels move goods over the transportation network. Any business that utilizes these forms of transportation will rely on invoices to continue their operation. However, as previously mentioned, this can lead to problems when a business must wait nearly three months to get paid. As a result, it is easy to understand how a business can seriously suffer from this type of situation.
Nearly 60% of invoices are paid late. It does not take a genius to understand that late payments are a legitimate problem for any business. For instance, if you go to a gas station and decide to pay them a month or two later, it can end up hurting their overall production. Now, imagine this happening with every single customer visiting said gas station. This is going to eventually snowball into a situation in which the business deals with a cash flow struggle.
According to a United States Bank study, 82% of businesses that fail do so because of cash flow problems. As previously mentioned, this cash flow problem can come from late payments. However, any business that takes time to hire in load factoring companies that will help the business avoid this type of problem. As a result, it is quite wise for anyone that deals with transportation as their business to get the best load factoring companies for help!
Closing Thoughts On Load Factoring Companies
Every single year, there are business that deal with bankruptcy due to unpaid invoices that are too late. No business can sustain success by having their transactions take place months after they perform a service. They will lose out on money and will deal with debt as they must pay their employees without seeing a profit for quite some time. Therefore, the wisest idea is to hire in load factoring companies to handle all invoices and more!