Factoring companies squeezed by slowing shipper payments: Alsobrooks

Core Insights - The current weak freight market is causing factoring companies to experience longer payment cycles from shippers, impacting their cash flow and pricing strategies [2][3][4] Industry Dynamics - Shippers are extending payment terms from net 30 days to as long as net 120 days, which is a significant shift in cash flow management [3] - This trend of delayed payments is leading factoring companies to increase their pricing to compensate for the longer wait times, thereby squeezing margins for carriers and brokers [3][4] Market Position - Shippers currently hold a strong negotiating position in the market, allowing them to dictate payment terms due to an oversupply of carriers [4] - The practice of extending payment terms may stem from legitimate concerns over credit deterioration among shippers [4] Company Performance - Triumph Financial reported that its factoring segment processed approximately 1.73 million invoices in Q3, with a total value of just under $3 billion [5]