Grand Financial and Revolution Capital

[loaders]

Is anyone else experiencing any problems with the apparent sale of Grand to Revolution? The transfer of accounts from the seller to the purchaser is completely messed up and causing payers like us, lots and lots of extra work. Finally today, we told them that will not change any banking info until we receive release letters from Grand and new NOA’s from Revolution. Too many potential “land mines” if you just cut them a check on their say so. This is to say nothing about the name change of Accutrac to E Capital and all of the banking info changes we have to make on our end. It is almost enough to say to a carrier...sorry, we cannot use you if you are factoring your invoices. Rant now over.

 

[marylou]

I see from paying my carriers via their factoring company that Revolution not only bought Grand Financial but also Baron, and Royal Financial Corp. So for all 4 payments go to Revolution.

 

[KeyFactor]

Is anyone else experiencing any problems with the apparent sale of Grand to Revolution? The transfer of accounts from the seller to the purchaser is completely messed up and causing payers like us, lots and lots of extra work. Finally today, we told them that will not change any banking info until we receive release letters from Grand and new NOA’s from Revolution. Too many potential “land mines” if you just cut them a check on their say so. This is to say nothing about the name change of Accutrac to E Capital and all of the banking info changes we have to make on our end. It is almost enough to say to a carrier...sorry, we cannot use you if you are factoring your invoices. Rant now over.

@loaders, I hear you on the extra work for you, but is it so easy to replace a reliable carrier?

 

[loaders]

No question, it is difficult to replace a reliable carrier. Which is why we always, always, always, offer our own quick pay program to our carriers. Unfortunately, if we have already received an NOA from a factoring company, we are unable to pay the carrier directly. The Grand/Revolution transaction has been particularly troublesome as it seems that the customers are being transferred over in stages. There have been multiple errors in reporting on their part which causes some invoices to appear overdue i.e. we paid Grand but Revolution says we should have paid them ARGH!!!!!! Extra work??? That’s putting it mildly.

 

[AccountsReceivable@DRC]

Not to mention having to create multiple accounts in your software with changing payments....

 

[economy]

In transportation industry buyouts are happening. Making amendments, changing payments, dealing with A/R-A/P, etc, are part of the business. You never know what changes are to happen tomorrow. No one wants to do the extra work, but such work is part of doing business.

Carriers choose to factor so they obtain timely and centralized financing for their operations and expansions. Therefore, the quick pay from various brokers arriving sporadically is not an option for cash striving carriers.

As brokers, it is your choice whether or not you wish to deal with carriers who factor. But if you choose to deal, I guess you should be ready to overcome the above described moan and groan.

Wish you all well! Unfortunately, out of suggestions on how to make it easier.

 

[Henry]

I had two carriers that deal with Grand. I have 3 that have been dealing with Revolution . I have not experienced any problems with the recent merger? Or take over.? I would definitely continue to pay whomever the NOA mentions unless you receive a release.

 

[Henry]

Do you know if Revolution took over Riviera? i had one carrier dealing with them but i heard they might have closed? Im not sure.

 

[KeyFactor]

No question, it is difficult to replace a reliable carrier. Which is why we always, always, always, offer our own quick pay program to our carriers. Unfortunately, if we have already received an NOA from a factoring company, we are unable to pay the carrier directly. The Grand/Revolution transaction has been particularly troublesome as it seems that the customers are being transferred over in stages. There have been multiple errors in reporting on their part which causes some invoices to appear overdue i.e. we paid Grand but Revolution says we should have paid them ARGH!!!!!! Extra work??? That’s putting it mildly.

I never want to be accused of handcuffing my client, so if they wish to take QuickPay from some customers, I will not stand in their way. I have also heard that QuickPay isn't always quick and some clients prefer to factor because they know they will get access to funds upon request. One size does not fit all....ya pays yer money, ya takes yer chances.

 

[loaders]

It would be understandable if factoring companies did discourage their clients from accepting quick pay from freight brokers. Our quick pay requires no forms or contracts other than the usual signed Bill of Lading, no commitment and is a take it or leave it offer. As a well financed, long term operation, there is never a question as to whether the money is available or not and carriers can select payments terms as short as 24 hours. I would never want to compete with factoring companies as it is not our core business, however if offering this service reduces our administration time and expense and adds a few percentage points to our bottom line, the question becomes......why not?

 

[Henry]

I never want to be accused of handcuffing my client, so if they wish to take QuickPay from some customers, I will not stand in their way. I have also heard that QuickPay isn't always quick and some clients prefer to factor because they know they will get access to funds upon request. One size does not fit all....ya pays yer money, ya takes yer chances.

A question ..

If someone pays one of your clients directly, aren't they still responsible to pay you? I never pay a carrier directly if i know they use a factoring company.

 

[economy]

It would be understandable if factoring companies did discourage their clients from accepting quick pay from freight brokers. Our quick pay requires no forms or contracts other than the usual signed Bill of Lading, no commitment and is a take it or leave it offer. As a well financed, long term operation, there is never a question as to whether the money is available or not and carriers can select payments terms as short as 24 hours. I would never want to compete with factoring companies as it is not our core business, however if offering this service reduces our administration time and expense and adds a few percentage points to our bottom line, the question becomes......why not?

Factoring companies do not discourage clients form accepting the quick pay. Its the reality of our transportation world when too many players offering the quick pay in fact releasing the payments with great delays. Therefore, cash short carriers in need of the centralized funding through the factors.

On the other hand, quick pay option is an absurd scheme from the start. Firstly, broker makes profit from hiring the carrier to haul the freight. Secondly, broker CHARGES the carrier additional fee for settling the debt/outstanding invoice. In reality, quick pay offered by the brokers is nothing but milking the carriers for additional profit, HIGH PROFIT.

I do not see the point of expanding this discussion any further, thus the transportation industry is too far from being perfect. It is driven by business principles of making money, generating profit and greed.

A question ..

If someone pays one of your clients directly, aren't they still responsible to pay you? I never pay a carrier directly if i know they use a factoring company.

To Henry, all the information of assignment conditions are part of NOAs clearly outlining to whom the payment has to go and conditions of the debt discharge. you are absolutely right not to pay to the carrier if you have the knowledge of the assignment. There are plenty of court orders making the debtor to pay for the second time to the factors when NOAs were ignored.

 

[loaders]

Economy, that’s the first time I have heard a factor publicly call out his own industry for “ milking the carrier for additional profit”. Our payment terms to the carriers we deal with is 30 days from receipt of invoice with proper and complete documentation. Pretty standard and pretty simple. If, for whatever reason, the carrier would like to receive his money earlier than that, we can and do accommodate them for a fee, just as a factor does for a quick release of funds. Hardly an absurd scheme. As to your assertion that brokers offering quick pay somehow renege on their promise when the time comes to release the fund....well, I can only speak for my firm and we do as we promise, each time and every time. For someone who claims to be familiar with our industry, your claim that brokers make a “HIGH PROFIT” even when the quick pay discount is taken into account, seems somewhat strange and out of touch with reality.I suppose the long and the short of this is there are just way too many cash strapped carriers out there that support your industry and persuade me to offer a quick pay program. While I would survive if all of the carriers out there were well funded, I cannot same the same about the future of your industry.

 

[economy]

Loader, I just made the correction to that sentence. Please do not misinterpret the idea.

 

[Henry]

Factoring companies do not discourage clients form accepting the quick pay. Its the reality of our transportation world when too many players offering the quick pay in fact releasing the payments with great delays. Therefore, cash short carriers in need of the centralized funding through the factors.

On the other hand, quick pay option is an absurd scheme from the start. Firstly, broker makes profit from hiring the carrier to haul the freight. Secondly, broker CHARGES the carrier additional fee for settling the debt/outstanding invoice. In reality, quick pay offered by the brokers is nothing but milking the carriers for additional profit, HIGH PROFIT.

I do not see the point of expanding this discussion any further, thus the transportation industry is too far from being perfect. It is driven by business principles of making money, generating profit and greed.



To Henry, all the information of assignment conditions are part of NOAs clearly outlining to whom the payment has to go and conditions of the debt discharge. you are absolutely right not to pay to the carrier if you have the knowledge of the assignment. There are plenty of court orders making the debtor to pay for the second time to the factors when NOAs were ignored.

My only worry is as follows.

If one of your customers obtains a quick pay directly from its customer, a factoring company could still pursue that receivable even if there was no NOA? that could result in a double payment by me?

 

[economy]

Henry, potentially there could always be the carrier who would look for immediate profit by defrauding both Factor and Broker and run away after. That is action of fraud but it happens. Do your due diligence when engaging in business relationship, review the invoice submission as soon as its made for NOAs, contact the Factor immediately if any issues. Do not expose yourself by offering quick pay - hire the carrier on COD terms, doing that you would eliminate all of the above. From our experience, it is extremely rare when Brokers do contact us alerting of some issues; usually we learn of them when it is too late and invoice is way past due and parties are acting outside of the common law scope.

The factoring industry came to existence for one and only reason: Broker is asking for credit from the carrier when one is hired. The law states that Carrier is entitled to be paid prior to delivery, however, the industry has adjusted itself to common conditions of working on terms. Perhaps, one day it'll adjust itself into the different direction similar to produce hauls that are mostly on COD terms.

 

[Henry]

So basically, if one of my carriers uses a factoring company, but does not factor a particular invoice, i am still responsible to pay the factoring company for that invoice. Understood and thanks for your time.

 

[loaders]

Which gentlemen, is exactly why I am suggesting that more brokers offer a quick pay program. I have nothing against factoring companies and as long as there are cash strapped carriers, there will always be factors. As Economy so correctly advised, it is the brokers responsibility to ensure they have received a proper NOA and a proper Letter of Release when the carrier decides to jump from one factor, to another, to another and so on and so on. If we have no record of receiving an NOA and no knowledge that the carrier has sold his invoice, I have no problem offering him his full invoice amount, minus a small deduction similar to and in line with, what a factoring company would offer. I am sorry Economy, but your statement that factors came into existence strictly because brokers wanted the carrier to extend credit is pretty far fetched. Factors merely answered a need in the industry to assist some companies, that for whatever reason could not finance themselves properly, either internally or through traditional banking. Their customers, brokers and shippers alike, were always late paying, their monthly expenses were always exceeding their receivables, the ownership wanted to withdraw cash from the company at a rate greater than what the company could afford. There are a myriad of reasons why carriers decide to factor their invoices as opposed to collecting them themselves, but brokers wanting credit is not one of them. I admire your efforts to defend your industry, but please try to be as factual as possible in doing so.

 

[economy]

Loaders, I am doing my best to carefully word my thoughts, yet again you are referring to some statement I have never made.

I am sorry Economy, but your statement that factors came into existence strictly because brokers wanted the carrier to extend credit

The above I did not say. My statement was:

The factoring industry came to existence for one and only reason: Broker is asking for credit from the carrier when one is hired.

For greater certainty, as a Broker, I referring to any entity who is engaging into a contract of carriage with the the carriers. In nowadays reality, majority of the contracts of carriage are being arranged through the middle man - Brokers.

Going forth, it'll be greatly appreciated if you are to refer to my statements, please use the exact wording. I have never intended to enter into an argument on the subject. The transportation industry is not even near to be a perfect world. There are Carriers, Shippers, Consignees, Brokers, Customs, Factors, bunch of the regulators and so on. We are all operate within until there is money to be made. We all have to do our functions diligently and comply with the laws, regulations, standards and so on. The subject of this discussion in the essence is moan and groan due to records amendments that you have to make within your organization due to buyout of accounts by Revolution Capital from Grand Financial. All you have to do is amend your records. I absolutely agree that its an extra work for you to do, something you do not need, something that is a nuisance and headache, but it's all part of doing business, something that you have to do and will do. This is the reality so lets close this subject for peace.

 

[SCAM CHASER]

Under the PPSA Act (Ontario),
"(2) An account debtor may pay the assignor until the account debtor receives notice, reasonably identifying the relevant rights, that the account or chattel paper has been assigned, and, if requested by the account debtor, the assignee shall furnish proof within a reasonable time that the assignment has been made, and, if the assignee does not do so, the account debtor may pay the assignor."

After you receive the first invoice from a carrier who has assigned that invoice to a factoring company, you can be held liable under the factoring company's General Security Agreement for future invoice payments (even if not stamped) as you had prior notice of their involvement. Many factoring companies attach a covering "letter" where the principal of the carrier signs the Notice of Assignment.

This assignment stuff can become very complicated - general rule - do not pay a carrier directly if you know that he has assigned invoices in the past, unless you obtain a written release even from the factor if it is only for that one invoice.