Changing Factoring Companies? What You Should Know.
Updated: Dec 20, 2021
Has the thought of changing factoring companies crossed your mind? Why is that? What happened to make it give you a second thought? Was it hidden fees, long term contract, decreasing customer support or slower funding of freight bills?
Superficially, changing factoring companies appears to be a stressful venture. Read on to the end of this article and we’ll explain how we’ll conduct a smooth transition on your behalf.
Whatever the single issue you have found with the existing factoring company, it begins to fester. Then you start looking for, and finding, faults in other areas of the factoring organization. Now the time has come to think about a change. For many that’s as far as it gets…thinking.
You have to weigh up the pros and cons of any situation and then make a firm decision to change. After making decision positive steps must be made accordingly. Without these steps you’re still only thinking about a change that will never happen.
For instance, it’s vacation time and you’re thinking of a trip to Hawaii. That sounds great, but without deciding on specific dates, making reservations for airline, car and hotel the entire trip remains just a pleasant thought. You’ll never make it to Hawaii.
Changing factoring companies is a little more difficult. Although a change is wanted, as humans, we actually resist change. This happens in all areas of our lives even at the grocery store. Walking down the cereal aisle there are hundreds of brands on either side sparring for your attention. Instead you go directly to the brand you’ve always purchased even though there are healthier, better choices available.
If you decide to buy Kellogg’s Mueslix instead of Frosted Flakes the kids are going to be upset. By purchasing the regular brand out of habit doesn’t require making a choice and that’s easier on us mentally. We know exactly what to expect from the product itself and avoid any negative reaction from family members.
The change of factoring companies requires more thought processes than purchasing cereal. As mentioned we resist and deep down we even hate change. To avoid making a decision we start rationalizing why NOT TO change.
Thoughts run through your mind to justify staying with the existing company despite issues urging you change. These thoughts appear logical, even thought you know a change would be, in the long term, beneficial, both financially and mentally.
The Fear Of Change
What’s behind these rationalizing thoughts? The answer is fear in all its disguises including fear of the unknown, fear of making the wrong decision and fear of failure. If that wasn’t enough there’s the mentally exhausting task of searching for another factoring company and completing the process.
All this encourages more self interrogation with questions like “do I have time to do all this?” “will I be better off or will I be going from the frying pan into the fire?” or “should I stick with the devil I know?”
With all this going on, it’s no wonder that maintaining the status quo, and doing nothing, looks more and more appealing. But at what cost?
Providing you choose the right factoring company the trouble can be worth it. When searching for a new factoring company superficially, they all start looking the same.
Our Customer Service Versus Theirs
Once you start peeling back the layers there are some major differences between other companies and us. Consider this, if factors strongly tout “customer service” and “we’re here for you” why do they insist on a 12 month contract?
If their all-round customer service was THAT good there’d be no need for contracts. They demand a contract because their customer service ISN’T that good but need to lock you in for 12 months for their benefit. Once you’ve signed there’s no need to provide the same level of service it took to get the contract.
These legal documents are written in their favor, not yours, making them self serving rather than customer centric.
Your Next Step –Questions To Ask
While we would love to handle your factoring it’s prudent for you to contact two other companies. During your discussion you should ask about the following 5 topics:
1. We’re Trucking Industry Specialists
Do they really specialize in the trucking industry? Some factors say they do, but they also work with manufacturers, staffing agencies, oil and gas, security and many other industries. They are a jack of all trades and can’t possibly be specialists.
We only have trucking company clients making us the Master of One!
2. Are You Talking To A Sales Rep Who’s On Commission?
This is a good question to ask. It’s not uncommon for sales representatives to “bend” the facts or even leave them out in order to get the sale. (Think car dealerships!)
All our employees are non-commissioned, so you are guaranteed to receive all the information to make valid business decision. As we only have month-to-month agreements we must be honest to earn and keep you as a long term client.
3. Our Month to Month Contracts
If a factoring company states you must sign a 12 month contract, RUN, NEVER LOOK BACK!
On the other hand all our clients are on month-to-month agreements. That means the pressure is on us to provide premium customer service EVERY DAY to earn your continued loyalty.
4. You Choose Which Freight Bills To Factor Through Us.
In their 12 month contracts, many companies insist that you must factor ALL your freight bills through them.
That means your clients that pay promptly, and don’t need factoring, now must be factored according to the contract. You are needlessly now paying the factor for those fast paying clients.
Under our agreement you make the decision which freight bills to factor. Those clients which pay promptly will continue to pay you allowing more money being kept in your pocket.
5. Their Hidden Fees
With our service there are no hidden fees. As we operate on a month to month basis we cannot afford to spring any surprises on you, otherwise we would lose you as a client.
We have heard of sales people at larger factoring companies, to get your business, will in discussion” state there are no hidden fees to get your business. Then you sign the contract in good faith and later find out “hidden fees” are written into the contract.
Make sure you get a copy of the contract in advance and have your attorney review it. Don’t sign without reading it thoroughly!
We Make The Transition Smooth And Stress Free For You
Some factors make it nearly impossible for clients to leave. Clients tend to get exhausted, cave in and just stop the process as they don’t have time to keep jumping through all their hoops. So much for their customer service!
Many factors have had a number of complaints filed with the International Factoring Association (IFA) and one large factor lost their membership status over this. It’s really a nightmare unfortunately.
Once you make the decision to change we will handle everything on your behalf. That includes liaising with the current factoring company for a stress free transition. We jump through their hoops on your behalf.
We have even streamlined our sign-up process to keep all required documentation to an absolute minimum.
Start The Change Process Today
As mentioned, we know that making a decision to change can be difficult and there are questions you probably want answered. Please call us for a no obligation discussion regarding your specific situation.