Small businesses sometimes need a way to speed up cash flow, especially during times of growth. But traditional sources of financing, such as banks, don’t offer flexible options, and not all small businesses qualify for the loan amounts needed to cover their growth opportunities. Banks base their loan decisions on the credit strength of the business and collateral, and those tougher credit standards can create roadblocks during crucial periods of growth. Additionally, the approval process can be slow.
But there is an alternative source of financing available, called invoice factoring, which is based upon your business’ accounts receivable and the credit worthiness of your customers. There are local invoice factoring companies in Kennesaw, GA, who serve the financial goals for small businesses and startups and understand the needs of growing businesses in Douglasville, Austell, GA, Birmingham, Huntsville, Tuscaloosa, AL, and the Atlanta metropolitan area.
Unlocking Potential Growth
Small businesses and startups may get trapped by limited capital. Their funds are often tied up in outstanding invoices, blocking their ability to purchase supplies or products or to pay their worker’s salaries.
A factoring company determines the credit worthiness of your customers—their ability to pay their invoices on time—and advances you around 80% of your outstanding accounts receivables, usually within 48 hours. You choose which customer accounts to factor. The factoring company deals with the payment from your customers, leaving you the freedom to focus on new growth avenues and taking care of your business.
Ways to Use Invoice Factoring
Every business is unique in its goals and each business faces its own unique financial challenges. Invoice factoring is a flexible and quick way to meet your immediate financial goals. Here are some ways small businesses typically use invoice factoring to support their needs:
- Factoring can help you eliminate debt and build your credit by providing the capital to pay down credit cards or other expensive loans, and taking advantage of early pay options from vendors.
- Seasonal businesses need cash to maintain their business during slow times of the year to meet expenses when cash flow is diminished.
- Factoring allows you to plan for future growth, providing the funds you need to invest in new contracts.
For more information regarding invoice factoring services, call Eagle Business Credit today and speak with one of our experienced team members.