Factoring companies are experiencing delays in getting paid by shippers, leading to longer wait times for carriers to receive payment, according to Phoenix Capital president Bryan Alsobrooks. Shippers are extending payment terms from net 30 to as long as net 120, impacting factoring companies and eroding margins for carriers and brokers. The strong position of shippers allows them to dictate terms, potentially stemming from credit issues. Consolidation in the factoring industry is increasing, with Phoenix preferring to acquire entire companies to retain relationships with customers. Despite tough market conditions, new entrants continue to join the factoring industry, potentially facing challenges without understanding transportation companies’ needs.

Read more at Yahoo Finance: Factoring companies squeezed by slowing shipper payments: Alsobrooks