In this era of high-speed everything, the ability to rapidly turn inventory into cash that can be reinvested in your business is critical. But swiftly turning over receivables is just not possible when you need to stay competitive by giving customers 30 or sometimes 60 days to pay. This is where factoring can help. Receivables factoring is when a factoring company effectively buy your outstanding invoices from you, paying you a portion of the invoice value up front and the remainder, minus a small factoring fee, when the customer pays the invoice in full. It is simple, efficient, and quick, and can sometimes be the difference between staying in business or going under.
Factoring improves your business in the following ways.
It can take you 1 to 2 months to convert your accounts receivable into cash. With factoring, you can get the cash you need in as little as 24 hours. This difference is huge. Factoring your receivables gives you access to the cash you need to run your business now.
No Bank Loan
Small business bank loans are difficult to get. The paperwork is onerous and the credit checks are daunting. The truth is that most small businesses find it next to impossible to successfully obtain bank financing for their ventures. Factoring your receivables gets you the cash you need with very little paperwork. Best of all, it’s your customer’s credit that will be checked by the factor, not yours.
No Long-Term Commitment
Factoring is not a long-term commitment. It is not a loan that will sit on your balance sheet for years collecting interest and it’s not an outside investor that needs constant coddling. Factoring is a revolving credit facility based on the value of your receivables so it fuels your grown and smooths out your cashflow ebbs and flows. A good factoring company becomes an extension to your business and some people consider it a form of outsourcing where they re-deploy their collections staff to other more important duties. Your balance sheet can stay healthy, you keep all the ownership to yourself, and you have the cash you need to grow your business.
Don’t wait! Contact a factoring company in Kennesaw, GA, today and grow your business tomorrow!