Factor Finance 101, obtain cash flow in an orderly fashion

Businesses can factor their outstanding accounts receivable invoices as a way to obtain capital in order to cover business expenses while experiencing growth.

Cash is king and immediate access to ‘cash flow’ is sitting right on top of your desk, tied up in accounts receivable invoices.

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Factor Finance 101

Factoring – Factoring is a financial transaction and a type of debtor finance in which a business sells its accounts receivable (i.e., invoices) to a third party (called a factor) at a discount.

Quick Terminology to Know:

  • Account Creditor – Usually that means you, or the Business and provider of goods and services
  • Advance Rate – The amount of money fronted to the company factoring accounts receivable invoices – as a percentage of the total invoice amount (not the full invoice amount).
  • Customer – Referring to ‘your customer’ responsible for paying the outstanding invoice.
  • Debt Finance – Capital secured in exchange for a commitment agreement to pay interest in addition to the principal amount borrowed.
  • Discount Fee – A fee assessed by the factor finance company that you have an agreement with to purchase your accounts receivable invoices for cash. The discount fee is calculated by the amount of the invoice, the length of time it takes to collect the owed funds and the creditworthiness of your customer.
  • Equity Financing – Capital secured in exchange for an ownership percentage interest in a company.
  • Factor Finance Company – A company that provides operating capital to business owners by purchasing their open accounts receivable invoices
  • Factoring – The purchase and collection of accounts receivables
  • Non-Recourse Factoring – A period in which accounts purchased by a factor remain the factor’s accounts and do not revert to the account creditor if unpaid; due to an insolvency event. A factor accepts full credit risk for any and all accounts purchased during this period.
  • Recourse Factoring – A period in which accounts purchased by a factor are able to revert to the account creditor if unpaid due to an insolvency event.
  • Rebate – Percentage paid back to you, minus the factors fee, once the debtor (your customer) has paid the invoice in full.
  • Reserve – Money that is held back as security by the factor to reduce their total liability in collecting the total and full invoices amount from the debtor. [ie., the advance rate + the reserve = 100 percent of the total invoice amount]

Turn your receivable invoices into immediate cash flow by factoring. Factoring is the conversion of accounts receivable invoices into cash by selling those outstanding invoices to a third part (called a factor). Factoring is especially important for companies in early stage development, during rapid growth or even financial hardship.

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Factoring will help to fill in the gaps created when your company delivers goods and/or services and when customers finally pay. The time in between is a gap, in which you’ve delivered but not yet been paid.

Many business owners worry that they don’t qualify for factor financing due to; not enough years in business or lack of adequate business credit. Well good news, factors actually base their decision on your customer’s credit history, not yours. If your customers are good creditworthy customers, then your business is most likely a very good candidate for accounts receivable invoice factoring.

Factoring is a simple and fast way to obtain business capital. Your outstanding invoices are considered an asset and you won’t add any new debt on the books by factoring. You can access a portion of your total invoice amount, usually up to 95% of the face value of the invoices. You’ll receive the other 5% of the invoice value, minus the factoring fees when the debtor (your customer) pays the outstanding invoice in full.

With factor financing you’ll be able to obtain cash to help your business without needing personal collateral or increasing interest expenses from other lines of credit you may be using. Remember, invoice factoring is not a loan and will not add debt to your balance sheet. You won’t accrue interest or penalties, like with traditional loans and the factoring fee is clear and agreed to by you and the factor before your first invoice is funded.

Factoring fees can be a flat fee or can fluctuate – so it’s important that you use factor bid when looking for the best factor finance company to finance your invoices, you’ll get a few competitive offers from factor finance companies eager to buy your invoices. Factor bid is free and gives the knowledge and leverage you need to make the best decision for your growing business, and ultimately get the best deal when factoring receivable invoices.

Build your business credit fast with factoring. With predictable cash flow on hand, your business will have access to money to payoff debt, pay overhead, salaries and accounts payables. This will help reduce your  business debt, increase on-time payment history and ultimately improve your credit history so you have more options from vendors and other financial institutions moving forward.

Mange your business operations more efficiently and hire employees to help maintain and acquire new customers. Let’s face it, you can’t do all the work! Let professionals help your business be a success today!

There is no reason your business should have to wait to be paid, while your customers use your money to grow their own business. Get paid within 24 hours of delivering goods and services by selling your accounts receivable invoices for immediate cash flow.

Factoring on the Go! Grab our free financing app called Factor App

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(Wondering about the terminology 101 and where it may have originated from? look no further – Somewhere along the line, “101” migrated out of academic institutional jargon and into popular mainstream slang.)

Increase company cash flow in 3 easy steps

Imagine what you could do with your money if you didn’t have to wait 30, 45 or even 60 days. Your business can get the revenue owed to you in accounts receivables within 24 hours of invoicing customers.

Step 1 – Visit www.factorbid.com

Step 2 – Submit an open invoice

Step 3 – Be available to receive competitive offers

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Your business accepts terms, like most competitive small-medium sized businesses in North America. Let someone else finance your customers net 30, net 45 or net 90. Use your earned money to wisely expand your business to increase marketshare and grow faster.

How? With Factor Financing.

Unlike banks, Factor  Finance Companies don’t hold you to a long-term loan backed by personal collateral. Factors simply get you the money you’ve already earned 30 to 90 days sooner! Factoring your accounts receivable invoices will help fix cash flow gaps immediately without digging you further into debt.

Factoring uses your business assets (accounts receivable invoices) to get you immediate cash! So what would you do with predictable cash flow on the first of every month. Opening up your accounts and seeing a consistent stream of positive cash flow; no more waiting for slow-paying customers to send you a check payment.

How to get started! Simple, visit Factor bid and click the Get Started button on the home page. You’ll be directed to login to a secure page, upload an invoice, tell us the amount of the invoice and what industry your company is in. Within the hour you’ll have a few of the top factor finance companies contact you with their very best invoice financing offers.

Don’t wait 30,45 or even 90 days, get paid as soon as today! 

Factoring Helps With:

Working Capital – cover payroll, day-to-day expenses, fuel, supplies, repairs and more

Growth Opportunities – accept more new business and increase you annual revenue

Maxed-Out Credit Line – factoring is asset based and uses your receivable invoices

Government Suppliers – purchase order financing and letter of credit

Payroll Funding – stop stressing about covering employees checks

Slow-Pay Customers – stop financing your customers, while your company struggles

Bank Turndowns – check out factor financing

Undercapitalized Companies – need immediate capital to keep your business competitive

High Customer Concentrations – flexibility in customer payments

Seasonal Business – produce and other seasonal items in demand

In Need Of Vendor Guarantees – cash  positive factor partner

IRS Issues & Tax Liens – pay off costly interest payments and liens

Operating Losses – pay down bad debt to keep your business running strong

Is your business in the transportation industry or always on the go? Grab Factor App and within a few clicks you’ll have competitive offers to buy your accounts receivable invoices.

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The reality of coming up short -when the bills are due (business finance)

If you’re reading this, your business may be experiencing a cash flow problem. Maybe you’re business could be performing at a higher level, making more money with less effort and lower stress. Are you properly managing your business cash flow? Do you see more bills that are due then revenue that has been collected? This type of shortfall can effect the health of your business and even leave you feeling angry, unsure and frustrated.

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Accounts receivable represents sales that have not yet been collected as cash. When you sell your good and/or services to a customer in exchange for the customer’s promise to pay you at a later time, you’re leveraging your cash and business credit to extend terms to your customers. If your business normally extends credit to customers, then the payments of your accounts receivables are likely to be the single most valuable source of capital in your business.

What can you do to Better Manage your Company’s Cash Flow

To Properly manage your company’s cash flow, you must first analyze components that affect the timing of your cash inflows and cash outflows. By reviewing and analyzing key components within your business you can discover areas that leave cash flow gaps and may be costing you extra money from temporary solutions that don’t add up long term. Narrowing or even closing cash flow gaps for good, is the key to efficient cash flow management.

Important Components you need to Manage Include

Accounts receivable.  Accounts receivables represent sales that have not been collected in the form of cash. Businesses create an accounts receivable invoice after you’ve sold something to a customer in return for his/her promise to pay at a later date. To properly manage cash flow, you must realize the negative affects caused by the time it takes your customers to pay off their open-outstanding invoices.

Inventory. Inventory management is very important and describes the extra merchandise or supplies your business has on hand to meet the demand of current and even new customers. An abundance of inventory can hurt your cash flow by using up money that could be used to grow your business.

Credit term. Credit terms are the time limits you set for your customers promise to pay for the goods and/or services purchased from your business.

Credit policy. A credit policy is the formula you use when deciding to extend or not extend credit to a customer. Your credit policy should be used to make sure your cash flow doesn’t fall victim to a credit policy that is too strict or too generous.

Accounts Payable and Cash Flow. Your business accounts payable are monies you owe to suppliers that are payable or due sometime in the near future. Net 30-45 or sometimes even 60 days from the delivery acceptance date. Without accounts payable and trade credit you would have to pay for all goods and services upfront or at the time you agree to accept/purchase them. For efficient cash flow management you need to examine your accounts payable schedule monthly.

Worst Case Scenario

In the worst case scenario, unpaid accounts receivables will leave your business without the necessary cash on hand to pay bills, employees and daily expenditures. Late paying or slow-paying customers will create cash flow gaps and shortages, leaving your business without the necessary cash on hand to cover outflow obligations.

Fixing the Gaps in your Cash Flow cycle

Looking into partnering with a factor finance company will help dissolve any cash flow gaps. A factor is going to provide you funds within 24 hours of invoicing your customers, closing out any shortfalls or outstanding payments that are due.

The Factor finance company resumes the responsibility of collecting payments from your outstanding receivables so you can focus on running your business and generating new accounts to help drive more growth.

Accessing cash with 24 hours of invoicing customers can help define your predictable cash flow each month. You’ll have a good understanding of how much money you have on hand for purchasing, investing and efficiently operating your business. You’ll be able to reach benchmarks you’ve set faster, accept new customers with no hesitation and manage existing customers more efficiently.

I want the Best Factor Finance Company, Help me find one

All Factors finance companies are different. Some specialize in specific industries and are able to offer competitive rates within their fields of expertise. If you present your invoices to a factor that does not specialize in your specific industry, but may still be willing to help finance your invoices, you may not be getting the experience and best deal you could receive with a factor that better understands your industry. You don’t want to be the guinea pig in a factors attempt to wing their way through trying to finance invoices in an industry like yours that they know nothing about.

That’s where Factor bid comes in. Factor bid matches your business with the top factors in your industry, while getting you a few competitive offers at the same time. When factors compete for your business, you win! You’ll get the knowledge and leverage you need to negotiate the best deal with the right factors that specialize in financing invoices in your industry.

Factor bid is a free small business resource and only takes about 2-3 minutes to get you started in receiving competitive offers from the top factor finance companies. Get started today by visiting www.factorbid.com

or Download Factor App for your Smartphone

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Are your Accounts Receivables costing you money, you’ve earned the right to know!

Your outstanding accounts receivable invoices are assets. You can sell those assets to a Factor for immediate cash. Stop waiting 30-45 or even 90 days to get paid. Factor your invoices and get paid within 24 hours!

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Factor financing or (factoring) is one of the world’s oldest forms of business commerce, and today accounts for over $3 Trillion* in annual transactions. Factoring is widely use by small-medium and large businesses all over the world.

Benefits of Factoring

  1. Unlock cash tied up in receivables
  2. Back office / bookkeeping assistance
  3. Credit Checking of new potential customers
  4. Grow your business faster
  5. Financial backing

Those outstanding invoices that are sitting on your desk are actually costing you money! By waiting to get paid, you’re missing out on new business opportunity. You’re spending your time chasing and managing money you’ve already earned. Let the factor finance company do all that. They have the resources, they have the people sitting in their offices that specialize in accounts receivable invoicing and collections.

Instead of your customers using your money to grow their businesses exclusively (by paying you on terms in 30-45 days) factor your invoices and use the factors money to grow your business right along with your customers, and become more profitable together for years to come.

How do you find the Best Factor Finance Company with little to no effort

Check out www.factorbid.com -where you’ll get a few competitive offers from factor finance companies that are eager to buy your accounts receivable invoices today for immediate cash.

Factor bid matches your company with factors that specialize in your industry and are eager to earn you new business and buy your outstanding invoices.

When factors know they’re competing to earn your business, you’re going to get a better deal when factoring.

Take 2-3 minutes out of your day and visit Factor bid, submit one of your open invoices and within the hour you’ll be contacted by a few of the top factor finance companies eager to earn your business and finance your business assets (invoices)

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What would you do with more cash on hand to run your business?

You didn’t get into business to finance your customers (by waiting 30 days to be paid) while they continue to grow their business using your money. Getting paid for work you’ve already completed, within 24 hours after invoicing your customer opens up options that will help your business become more successful.

For example: More cash on hand enables you to buy supplies in bulk at a discount, hire additional employees to generate and manage new business relationships, helps cover daily/weekly expenses to keep your business on track and provides the opportunity for investments and securing new business deals that may have been impossible before.

Factors make money in fronting your business money on open invoices. It’s actually in their best interest if your business grows and becomes more successful – the more invoices you generate for goods and/or services delivered the more your relationship grows with your factor finance partner. Factors are going to help you streamline your Accounts Receivables by managing your invoicing and collecting payments in the most efficient way possible so you can focus on running and growing your business everyday!

Why do business owners Factor their receivable invoices

  1. Cash Flow – even if your business is profitable on paper, outstanding invoices can slow your growth potential and even cause you to loose business to more aggressive competitors that have ready cash flow to make more aggressive business decisions quickly.
  2. Unlimited Growth – You can accept all new business as quickly as your can acquire it. With access to cash, you really have no limits to how big your company can grow.
  3. Business Equity – If your company is still new, and lengthy bank loans are not an option right now, don’t liquidate your equity by desperately selling out to an investor before your company has reached it’s potential. Factor your assets (invoices) instead!
  4. Get Rid of Bad Debt – Checkout non-recourse factoring, which is a credit guarantee on your advance. Non-recourse can protect you from having to repay money personally if a customer does not pay.
  5. Lower Stress / Increase Productivity – focus on good things, growth and encouragement of new ideas within your business. Outsourcing your A/R Bookkeeping to a factor will put your mind at ease and help your business grow more quickly.

 

On the Go -check out Factor App for fast, simple factor financing. Get started in under 2 minutes!

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Absolute quickest easiest access to more money today by leveraging your invoices!

Absolute quickest and easiest access to more capital for your growing business.

Factor financing (using your accounts receivable invoices) to get immediate cash for your business. Factors buy your business receivable invoices and you get paid within 24 hours of invoicing your customer.

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Can your business use more cash on hand;

  1. to cover payroll
  2. buy supplies
  3. pay day-to-day expenses
  4.  buy new equipment, fuel, repairs and more

Your accounts receivable invoices are an asset and you can use them to increase your daily/weekly/monthly cash flow! If you wonder how competitors and other business affiliates are growing so quickly, you may want to take a deeper look into factor financing.

Below are some case studies of companies that are utilizing factor financing to grow and reinvent their businesses to keep up with demand from today’s ever-changing and evolving customer demographic.

Case Studies of business that are benefiting from factor financing today:

 

Example 1 – Great Customers that pay on time with excellent credit

A solar panel design and manufacturing company has low capital to cover day-to-day expense, but has strong customers with well established credit ratings and payment history. Although the company is profitable on paper, the company’s owner was tired of always having to bank roll short term expenses. Keeping track of all the advances the owner was personally making to the company, and then getting paid back was messy.

The business owner discovered factor bid and was able to get a few offers from the top factor finance companies to buy his accounts receivable invoices for immediate cash. Now the owner is relaxed and his business is more secure with the professional help of the factor for collecting receivables. He now spends most of his time focused on new business accounts and his sales team’s performance and return on investment.

Example 2 – Supplier of Computer Components runs into a cash flow pinch:

A supplier of mobile phone components imports and resells their product to a variety of U.S. based customers. Their forward thinking in bulk purchasing and niche product in an evolving market has lead to significant growth.

As a growing company with a lot of overhead, restricted access to capital and/or line of credit was making it difficult to take advantage of volume order discounts. A flexible invoice factoring arrangement provided a much needed solution that significantly increased the company’s ability to operate, resulting in a jump in quarterly and annual profits.

After factoring for 24 months the company realized it had enough capital to cover purchases but didn’t necessarily want to end their relationship with the factor finance company.  The predictable cash flow they’re able to have by partnering with a factor enables them to be more aggressive and focused on strategic alliances and new growth. They figure, if they fee they are paying the factor to get their money 65 days sooner is costing them less than the profit they’re making from having their money 64 days sooner then why would they stop using the factors money to make money.

This scenario doesn’t work for every business, but it will for most. If your business is making more money than it’s costing you and your profits are climbing, then you’re doing something right and your most likely on your way to increasing your market share and beating our some of your competitors competing for the same business and customers.

Example 3 – A Company is downsizing with the need for finance alternatives

A manufacturing company needs to change it’s business model to keep up with the modernization of delivered products in their industry. Customers promise to keep buying and support the change to ultimately increase sales by reaching new customer demographics while updating their existing customer buyers with more modern products.

The move by management requires the financing for new equipment, additional employees, training and materials that will ultimately squeeze the company’s cash reserves.

The answer is to unlock cash that’s tied up in their accounts receivables for 90 days or more. Once they put the right arrangement in place with their new factor finance partner, they were able to quickly unlock cash that’s been sitting around in their receivables. The company is now highly profitable and attracting new customers on a global scale.

Example 4 – Technology Company

A technology company redirected their team of engineers and developed a new, easier version of their existing product. They also updated their business plan and brought in some new employee talent.

After 16 months of losses and the recall of a bank loan, the company was short on cash and unable to secure another bank loan or source of lending capital. However, orders were climbing and the product’s sales cycle was shrinking which pointed to an increase in positive growth.

The company discovered factor financing, and were able to increase cash flow, allowing the company to strengthen vendor relationships and concentrate on sales instead of collections. After 30 months of factoring invoices for immediate cash, the company is now profitable and attracting large bids of private money for a new growth cycle.

Example 5 – Call center business growing “too fast”

A call center that specialized in handling calls for a rapidly growing computer software company who’s software sales and database was growing exponentially. The call center was able to generate a 40% return per employee after 3-5 months but needed additional working capital to hire more senior staff for training, management and facilitation of all the new customer accounts. The company also had substantial contract in place for additional call services, that would require them to double their staff and working space in the next 3 months. This would result in a huge payroll increase and cash flow requirement right away.

This is a classic example of the need for immediate working capital to grow your business quickly. After reading a blog they found online the company wanted to try factoring their receivables to help liquidate cash tied up in invoicing current customers. They then googled how to find the best factoring company and discovered factor bid.

Factor bid got them a few offers from aggressive factors that were eager to earn their business and take part in their rapid company expansion and growth. Today the company has over 150 call center representatives and services some of the top software companies in the western United States.

If you’re business needs help unlocking some or all of the money tied up in your accounts receivables, then visit www.factorbid.com to get a few competitive offers from competing factor finance companies. Don’t wait 30,45 or even 90 days to be paid, get paid as soon as today!

Is your business on the Go! Download Factor App for your Smartphones

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Factoring (invoice finance) what is it and how to get the best deal

Accessing business capital for businesses of any size can be a stressful undertaking. Traditional bank loans can take weeks even months to become available, and even alternative lenders may charge high interest rates for the convenience of fast cash.

When it’s all said and done getting access to ongoing business capital to run your business can be challenging. If you take into account all the paperwork and time involved in setting up a relationship with a traditional lender, not to mention -it may take months before you even get an answer of whether or not you’re approved.

If you’d rather not have to wait and go through all the hassle of traditional loans and le, you may want to consider factoring (invoice financing).

WHAT IS FACTORING

Factoring is a financial transaction and a type of debtor finance in which a business sells its accounts receivable (i.e., invoices) to a third party (called a factor) at a discount. A business will sometimes factor its receivable assets to meet its present and immediate cash needs. (see full details at wikipedia)

Factoring is an alternative method of financing that allows business owners like you to sell your invoices, aka your accounts receivables for immediate cash!

HOW TO GET THE BEST DEAL

If you’ve made up your mind and are ready to start factoring your invoices for immediate cash, visit www.factor.bid to get started. At Factor bid -factor finance companies compete for the opportunity to buy your invoices. You’ll get a few offers from the top factor finance companies. When factors compete to buy your invoices, You Win!

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Not all factors are created equal. Different factors specialize in specific industries, and can’t always give you the best deal in your industry. Trying to locate a few factors online that do specialize in your industry is time consuming and can be a frustrating experience.

Factor bid quickly matches your submitted invoice with a huge database of factors that specialize in your industry. You’ll be contacted by a few of the top factors with their most aggressive offer. With Factor bid you’ll get the knowledge and leverage you need to negotiate the best deal when choosing your new factor finance company.

When factors know they’re competing to earn your business (factor bid) they’re going to give you a competitive offer when offering to buy your invoices. Factors want your ongoing business for as long as you need cash flow to grow your business, cover daily expenses, cover payroll, buy supplies and even invest in new business opportunities. If you contact a factor on your own by calling them or filling out a form on their website, you’re only going to receive one offer, instead of a few competitive ones!

Having access to cash within hours of invoicing a customer is a smart business practice. Even if you don’t need cash now, get set up with a factor so when you do need it, you can get paid immediately and access your cash, instead of waiting weeks or even months like you would have to with traditional bank loans.

HOW FACTORING FUELS GROWTH

Business owners with capital tied up in large purchase orders can benefit from factoring. For example -If your business doesn’t have cash to purchase supplies needed to fill an order or money to pay the employees salaries to fill new orders, then factor financing can help. If your outstanding invoices are making it difficult to keep up with new orders and even putting your growth trajectory at risk, then find out how factoring your invoices for immediate cash flow can help keep your business on the track.

Factoring your open receivables will unlock cash trapped in your invoices. You’ll also receive help from factors in simplifying your accounts receivable process. There is no collateral required to work with a factoring service, and the factor uses your customers credit rating and payment history, not yours. So if you’re a new business and are thinking you won’t qualify for financing with a factor, you’re wrong. Factors use your receivables (which are an asset) in order to get your the cash you need to make important business decisions today. Stop waiting 30, 45 or even 90 days, get paid as soon as today!

CONCLUSION

Factoring may not be the right fit for your business. However, if your day-to-day operations are suffering due to large cash flow gaps from outstanding invoices, then the option of getting a few offers for your receivables should be considered.

When you use Factor bid to connect with factors that specialize in your industry, you’re under no obligation to factor. You’ll get a few competitive offers from factors that are eager to earn your business. You decide if the offers are right for your business and then use the competitive offers to negotiate the best deal when accessing immediate cash for your business.

You want to work with someone that you trust and is transparent. The best way to do this is to use Factor bid. When factors know they’re competing for your new business, they’re going to be more likely to give you their best offer right out of the gate, because they know if you’re using Factor bid, you’re getting competitive offers at the same time.

It’s important that you view factoring as a financing strategy conducted over a period of time. Within this time, realize that factoring can help your business expand or recover while achieving long-term goals. The potential downside to any source of financing is that the fees may add up over time, and end up being more expensive than a traditional bank loan; that uses your home or some other large asset as collateral. However the higher cost upfront, may be worth it for immediate access to cash you need to secure new customers, cover business expenses and pay employees that are working to make your business more profitable. It may also be worth it not to use your personal savings and/or assets, like your home as collateral. Factoring your invoices don’t require any form of personal guarantee and may be just the solution to help your business reach the next step in your growth plan.

FACTORING TYPES YOU SHOULD KNOW

There are two classifications of factor finance services:

Non-Recourse factoring: NonRecourse factoring releases the business owner from liability for delinquent receivable accounts. In a non-recourse agreement the factor is taking on more responsibility and legwork in collecting outstanding owed receivable money. This type of factoring requires more attention to your account, more in-house and outsourced resources they may need to use to collect the debt, therefore is more costly. Also the creditworthiness of a business’ clientele will be more closely scrutinized in nonrecourse factoring.

Recourse factoring: Recourse factoring is the most common type of factoring today. Factors fund your invoices but require you t provide a refund on any invoices that remain unpaid past a certain amount of time, that they have fronted you money on. Since the business owner assumes the risk with recourse factoring, there is a wider range of more competitive rates and a lower cost to you to access immediate cash as needed for your business.

Bottom line is, business owners want to get paid for their work right away. The job isn’t considered complete until the customer has paid the invoice and the check has cleared the bank. So to keep your cash flow predictable and your stress levels low, visit Factor bid, submit an open invoices from your business and within the hour you’ll have offers from the top factor finance companies, eager to buy your invoices.

Once you’ve selected the best offer from the factor finance company that best fits your needs today, you’ll have a savvy partner (factor finance company) that will help you streamline your accounts receivable collection process, check the credit of new potential customers you’re considering doing business with and access to cash within hours of invoicing customers.

Get going on increasing cash flow for your business today, Get Factor.bid

Is your business mobile? Download Factor App and submit your accounts receivable invoices via your Smartphone or Tablet.

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Two ways to factor your open invoices; recourse and non-recourse.

Two ways to Factor Finance your outstanding accounts receivable invoices for cash! Get an injection of cash for your business that trapped in your accounts receivables. Funding in as little as 24 hours! www.factorbid.com

*Recourse Factoring Agreement

*Non-Recourse Factoring Agreement

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Ask questions about your factoring agreement!

Factoring benefits your business by providing immediate cash flow on your accounts receivable invoices. You’ll have the cash on hand to grow your business, cover daily expenses and even invest in additional supplies, employees and opportunities that present themselves.

Factors also add their assistance with back office bookkeeping help. Factor finance companies collect payments on your outstanding receivables from your customers. Having more cash on hand plus a factor that handles collections provides you the time and money to do what you do best, work hard for your business!

Let’s discuss your two types of factoring; recourse and non-recourse factor financing.

Non-Recourse Factoring

Pro:

Non-recourse factoring is appealing from a risk management perspective. It lowers your company liability.

With non-recourse agreements, the factor accepts more of the risk of non-payment by your customers that don’t pay.

Con:

Non-recourse factoring is usually more expensive than recourse factoring. Non-recourse factoring is also limited to debtors (your customers) invoices that are most likely to pay. If a debtor has poor payment history and credit rating, a factor will usually not assume the risk of non-recourse factoring.

Non-recourse factoring doesn’t always protect your company from all risk involved from non-payment by a debtor. Some factor finance companies only offer non-recourse in the event your debtor declares bankruptcy. But if a debtor decides to simply close their doors and disappear  one day without paying, the factoring client will have to buy back that invoice from the factor finance company.

Recourse Factoring

Recourse factoring is the default for most factoring agreement today. Recourse is an understanding between you and your factor finance company, that you must buy back receivables that the factor is not able to collect on.

Pro:

Recourse factoring is typically less expensive. Less risk for the factor finance company means a lower rate for your business when selling your invoices for immediate cash.

Con:

As the client, you’ll have to cover the cost of any invoices (bad debt) of your customer that decided not to pay.

Whichever type of factoring you decide to obtain through your factor finance company, make sure you’re getting a few offers from different factors so you get the best deal. Every factor is different and every business has different types of customers. You may work with big companies that have long business standing in the community and are seen as low risk, which means your rate and terms may be different from a business working with a newer more high risk company with less long-standing business history to examine.

By visiting www.factor.bid – you’ll get a few offers from competing factors that specialize in your specific industry. When factors know they’re competing for your business at the exact same time, you’ll get their very best deal!

Start your factoring experience the easy way, by using factor bid, where we match you with the top factor finance companies that are eager to earn your business and provide you with competitive offers to prove it!

www.factorbid.com 

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Business Owners Access Capital Here

Unlock business capital trapped in your Accounts Receivable Invoices. Don’t wait 30, 45 or even 90 days, get paid for your outstanding invoices as soon as today!

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How?

Go to Factor bid – where you’ll get a few offers from factor finance companies to buy your accounts receivable invoices for immediate cash. Factors compete for the opportunity to buy your invoices, and within an hour of submitting an open invoice, you’ll receive a few offers from the top factor finance companies to buy your invoices.

In More Depth -WHAT IS INVOICE FACTORING for Small Business Owners?

When a business creates the option for a customer to pay later or on terms, it’s known as (invoicing) – Accounts Receivable Invoicing.  Accounts Receivable is a legitimate form of revenue for all businesses and is listed as an asset in the company’s balance sheet.

Why would a company agree to allow a customer to pay on terms and at a later date rather than COD (cash on deliver) or even up front, out of pocket?

The idea behind offering your customers the ability to pay on terms is;

  1. Customers today demand flexibility.  If a business does not have the ability to be flexible- they risk losing sales to competitors in their industry.
  2. Offering terms through invoicing enables the business owner to finalize the sale-agreement rather than allowing the customer to walk out the door to another business.
  3. Customers typically buy more (of whatever it is you offer), when they have more time to pay.  

As such many business owners understand that their Accounts Receivable Invoices are a promise from a customer to pay at a later date and time.  Yet many business owners have little of no idea the same Accounts Receivable Invoices are in high demand by third parties (called factors) that are interested in purchasing invoices (at a discount) for immediate capital.  In many cases cash is made available to the business owner selling their invoices, within 24-48 hours.  This practice of purchasing a company’s Accounts Receivable invoices at a discount is known as Invoice Factoring.

BENEFITS OF INVOICE FACTORING include but are not limited to:

  1. The ability for a business to acquire cash (capital) quickly to be used for necessary expenses.  Often times small businesses need immediate cash flow to assist in keeping the doors open until they build up a stockpile of available cash flow
  2. The means of using invoice factoring to generate capital is more attractive than applying for a loan at the bank which can require time and high risk contracts.
  3. Invoice financing (factoring) is considered an asset, and does not add any additional debt to your company books.
  4.  Factor finance companies can also assist your business in the accounts receivable collection process, including back end office and bookkeeping help.
  5. Factors can provide access to credit checking of new potential customers you’re thinking about working with, to help reduce your liability in working with bad companies that may not pay their bills on time. 

Before now – locating a factor finance company that specializes in and even services your industry –as well as getting the best deal when factoring our receivables was extremely difficult; leaving business owners thinking, ‘Did I get a fair deal when signing on with my new factor finance company.. ?’

But today, locating a factor finance partner has gotten much easier, a lot faster and more convenient; not to mention being able to get a few competitive offers to make sure you’re getting the best deal when factoring.

Tell Me How?

FACTOR BID quickly matches your business with the top factor finance companies in your specific business industry, providing you multiple offers from competing factors, eager to earn your business and buy your open accounts receivable invoices for immediate cash!

When factoring companies compete to win your Accounts Receivable Invoices- you get the knowledge you need to negotiate the best deal when factoring.  You’re under no obligation at any time to factor and the cost to use factor bid is free and may result in an immediate increase in your business cash flow on hand, in which you can use for whatever you want. 

Are You Ready?

Access working business capital today that’s sitting around on your desk or stuck in your online accounting software (in the form of open invoices).  Your open invoices are an asset – start treating them as so! Get paid as soon as today! Factor bid

On the Go? Get Factor App and submit your invoices from your Smartphone!

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Which is the best factor finance company for my business?

Factoring your accounts receivables can open your business up to much needed cash flow. A factor finance company will buy your accounts receivables at a discount (from their face value) for immediate cash. You can get up to 95% of the face value of your invoice within hours of invoicing your clients.

How do you find a factor finance company that can service your industry. Not all factors service every industry. Some factors specialize in specific industries.

SOLUTION: Factor Bid

Factor bid matches business’ with factor finance companies. You’ll get a few competitive offers from competing factors to buy your accounts receivables for immediate cash.

The best factoring company for your business will depend on the unique characteristics of your business and most important your specific requirements. For example; are you strictly looking for the lowest rate? If yes, then recourse factoring may be your best option. If you’re looking for back office ‘bookkeeping’ assistance and to lower your liability on collecting your open receivables, then non-recourse factoring may be your best option.

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Visit www.factorbid.com to get a few offers to buy your invoices for CASH!

The main aspect of any factoring company’s proposition is the structure of their facility, service offering and pricing.

Structure of a facility:

It’s important that the facility is structured to meet your business needs. Some lenders may not be able to structure a facility to meet your specific needs. That’s why it’s important that you get a few offers from competing factors within your industry. Not all factors will be willing to work with you once they run their in-house liability equation. This equation has a lot to do with risk vs. reward, the amount of risk they have to endure before they receive a suitable reward.

Service Levels:

Service levels may fluctuate from factor to factor. It’s hard to gauge the type of service performance you’ll experience before committing your company to a 12 month agreement. This is another reason to use factor bid to find the right factor finance company for your business. Factor bid personally on-boards each and every one of our participating factors. If we’re made aware of any  negative feedback from business owners, we reach out to the factors personally to see what the issues may be. Often times a little constructive criticism from a third party such as ourselves, help communicate and solve underlying issues and even prevent new ones from occurring.

Pricing of your factor finance facility:

In order to maximize your profits, you obviously want to minimize costs! It’s important not to sacrifice structure and service levels just to get the cheapest price. You may feel you are saving money, but if the service levels are so poor the small amount of savings may end up costing you more over the long run. Instead, use factor bid to get competitive offers at the exact same time, so you get the leverage you need to negotiate the best deal.

When factors know they’re competing at the exact same time for your business, they’re more likely to give you their most competitive offer upfront. Try factor bid today for free! You’re under no obligation to factor, however when you find how beneficial invoice financing is for your business, you’ll be glad you spend 2-5 minutes of your time to submit an invoice at factor bid.

Is your business mobile? Grab Factor App for factor financing on the Go!

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Your company needs working capital to sustain business growth (invoice finance)

Working capital is the cash necessary to keep the doors open, the business running efficiently, all while meeting financial obligations in order to turn a profit.

Positive cash flow creates a company’s working capital along with investor funds and even bank loans on occasion. When your business has more cash coming in than going out there is a positive cash flow. However when more cash is leaving the business than coming in, cash flow is tagged as being negative.

How does your business cash flow look?

Is your business experiencing cash flow problems? It’s not enough for a business to be profitable on paper if there is no predictable cash on hand to pay day-to-day expenditures like payroll, rent, suppliers and other obligations. With limited cash flow you’re production runs may be disrupted, fulfillment orders delayed and growth slowed. To be sustainable, a business must have positive cash flow – more money coming in than leaving. If you have a good business with solid long-term expectation but you struggle to pay operative monthly bills, chances are your business has a cash flow problem.

Check out www.factorbid.com to get competitive offers on your financing needs!

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What is causing your cash flow problem?

It’s important to determine the cause of your cash flow problem. There are a few primary factors that impact a business cash flow, both in a positive and negative way.

  1. Inventory – Every dollar spent on inventory is a dollar less you have to spend on growth strategizing.
  2. Payables – Every dollar you invest in paying suppliers ‘upfront’ is a dollar less available to spend on growth.
  3. Accounts Receivables – Every dollar tied up in accounts receivables is a dollar you don’t have to spend today!
  4. Growth Rate – Every dollar tied up in expansion is a dollar less you have to spend.
  5. Profit Margin – Quarterly profits are great but you need cash to pay bills now.

So how do we solve cash flow problems?

We need to take into account the business inventory, profit margin, accounts receivable, accounts payable and growth rate. By calculating current and projected figures for your business, you can forecast monthly cash flow needs, determine potential cash flow gaps, and develop strategies to mitigate cash flow problems.

A good financial model lists cash vs. profits!

You’ll need to calculate fixed numbers like

  • Starting Cash $200,000
  • First month’s Sales $5,000
  • Cost of Goods Sold (50% of Sales)
  • Monthly Sales Growth (1%)
  • Sales on Credit (100%)
  • Collection Days (30)
  • Profitability (% of Sales)
  • Initial Inventory Balance ($0.00)
  • Months of Inventory (Kept on Hand)
  • Starting Receivables ($0.00)
  • Starting Payables ($20,000)

Once you calculate your figures, it’s a much easier to clearly identify your cash flow problems and understand how much additional cash your business needs to operate smoothly until your cash flow positive.

If you find you’re not able to solve your cash flow problems by renegotiating terms with suppliers, cutting down excess inventory, increasing profit margins, slowing growth, or convincing customers to pay sooner, you should look for an external source of cash, a financial partner like a factoring company.

If you’re not a fan of acquiring new debt by taking out a bank loan and you’re already financially carrying your customers by agreeing to a net 30 or net 45 payment terms, you most likely can benefit from factor financing your outstanding accounts receivable invoices for immediate cash. Cash flow problem solved!

Factoring is a flexible financial solution that turns the bulk of A/R Invoices into immediate cash within 24-48 hours of invoicing your customer(s). The approval process is fast and simple and the fees are small, making the factoring financial solution an elegant business choice for the growing B2B entrepreneurial business.

Factoring is affordable, flexible and fast. If you’re considering factoring your open accounts receivable invoices, make sure and visit Factor.bid – where factors compete for the right to buy your invoices for immediate cash. Get a few offers from the top factors and choose the best deal for your growing business!

Is your business MOBILE? Get Factor App for invoice financing on the GO!

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