Drivers may love the peace and solitude of the road, and they may love seeing America.
But let’s face it, when the rubber really hits the road, truck drivers do their work for the same reason as everyone else — to get paid. And getting paid quickly and accurately is a bonus all owner-operators and small freight businesses would like to have.
Enter the concept of factoring.
“Factoring helps truckers receive payments faster and handle the invoice payment, processing and collection for drivers,” said Samer Hamade, vice president of operations for RoadEx.
Under a factoring arrangement, the driver trades a small percentage of the invoice to the factoring company for its services. Factoring companies offer multiple services to encourage drivers to sign on, ranging from credit checks on potential customers to low fees. It’s important that owner-operators understand the terms of their factoring contract and how a factoring partner will benefit their operation.
Times are rapidly changing, and changing technologies are impacting the way factoring companies operate.
“Technology has played a major role in factoring and has become more sophisticated over time,” Hamade said.
RoadEx is among the first in the industry to offer factoring clients a bank account and card that allow drivers to receive their funds quickly, with no minimums or fees associated. According to a company statement, RoadEx RapidPay can help drivers secure money for their loads when they need it the most, even during the holidays and on weekends.
“There aren’t many companies who provide speedy funding for invoices, but as an early adopter of this kind of service in the industry, we’ve listened and recognized that getting paid in a timely fashion continues to be a challenge for truckers,” Hamade said. “Our goal with RoadEx RapidPay is to bring convenience to companies so they can have quicker access to their money.”
Once a delivery is complete, RoadEx RapidPay users upload the invoice to their rep; as soon as the invoice is approved, the money is deposited into the driver’s account in 10 minutes or less and can be easily accessed through the client’s bank card.
“Cash flow is an essential element owner-operators consider when trying to determine if factoring is the right financing option for them,” Hamade said, noting that whether it’s a driver’s first year or 10th year on the road, it’s important to receive payment quickly instead of waiting 30 to 40 days.”
Smartphone technology has helped factoring grow in popularity.
“Drivers find it easier to use their phones to access their information instead of going through longer processes like submitting an invoice … during a truck stop,” Hamade said, adding that more drivers are using factoring companies to manage their accounting functions, from invoicing to collections.
“Thanks to factoring, truckers have more time and ease to focus their attention on other areas of the business,” Hamade said.
“At RoadEx, our ‘for truckers by truckers’ mantra guides how we support our customers and we’re always looking for ways to scale our services to further meet the needs of drivers, Hamade said. “As our industry navigates through a challenging trucking recession, rates are lower than ever and payments are higher, which makes it hard for drivers to have positive cash flow. RoadEx RapidPay will directly address this pain point for owner-operators who need to pay their drivers or pay for emergency repairs.”
He describes RoadEx RapidPay as a “one-stop shop” for owner operators.
“Factoring funds can go toward a client’s insurance, or fuel without dealing with multiple vendors. Trust and transparency are key components to a great owner-operator and factoring partner relationship,” Hamade said. “At RoadEx, we have dedicated and knowledgeable account representatives, who work to help truckers get reasonable rates and top-notch customer service.”
When looking for a factoring company, owner-operators should do their research and be familiar with the services provided, as well as the company’s reputation.
“Whether it’s hidden fees or the amount of time it takes to receive funds, it’s important for owner-operators to do their research on a factoring company by checking reviews and making calls,” Hamade said. “Doing the research prior to a contract commitment will help trucking companies find the right factoring partner to support their business.”
Since retiring from a career as an outdoor recreation professional from the State of Arkansas, Kris Rutherford has worked as a freelance writer and, with his wife, owns and publishes a small Northeast Texas newspaper, The Roxton Progress. Kris has worked as a ghostwriter and editor and has authored seven books of his own. He became interested in the trucking industry as a child in the 1970s when his family traveled the interstates twice a year between their home in Maine and their native Texas. He has been a classic country music enthusiast since the age of nine when he developed a special interest in trucking songs.