Every load you invoice on terms is a short loan to your shipper. A new broker can move freight well and still fail because one shipper doesn’t pay.
Check before the first load
- A credit application with the legal name, address, tax ID and billing contact.
- Trade references, ideally other freight or transportation vendors. Call them.
- A business credit report, or a check with a freight credit service.
- Basic signs: a working website, a physical address, and an email domain that matches.
Watch for fraud as well as slow payment. Someone can pose as a real company, so confirm new accounts by calling a number you found independently.
Set a credit limit
A limit answers one question: what is the most this shipper can owe you at once? Base it on what you learned and on what you could survive not collecting. Start lower for new accounts, and raise it after a record of on-time payment.
Choose terms you can fund
Terms like Net 30 mean the shipper pays 30 days after the invoice date. Compare that against when you pay carriers. The longer the difference, the more cash you need. Run your numbers in the cash gap calculator before you agree to long terms, and consider pricing them into your rate.
Make it easy to get paid
- Invoice the day you have proof of delivery.
- Send exactly what the shipper asks for, including any reference numbers.
- Confirm receipt of large invoices.
- Follow up before the due date, not after.
When a shipper pays late
Call early and ask when payment will be made. Stop booking new loads once they reach their limit. Put your requests in writing. If the debt stays unpaid, talk to a collections specialist or attorney.
In Juno, shipper credit is checked as each load is booked, and the available credit comes back as the shipper pays.
Common questions
How do freight brokers check shipper credit?
Through a credit application, trade references, business credit reports and freight credit services, plus basic identity checks.
What are normal payment terms for shippers?
Terms such as Net 30 are common, but they vary by shipper. Only agree to terms you can fund.
Should I still pay the carrier if the shipper doesn’t pay me?
Check your agreements and get advice, but plan on it. Carriers can claim against your bond if you don’t pay.