Source of funds and your business growth

Once you know your needs, you need to determine where the money will come from (source of funds). Don’t overlook this important piece of your business planning. Of course the idea is for your business to generate enough cash flow to pay for business expenditures plus your personal living expenses and more.

Assets:

To start – list any assets and cash that you are contributing to start-up or for expansion. Show the full amount of any lease, loans, investments by partners or other investors, etc.

Personal Requirements:

List funds you need to meet your personal living expenses. This will help in determining your projected cash flow each month or quarterly.

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Cash Flow Projections:

One of the things to remember in preparing your business cash flow projections is you’re not trying to determine profit or loss yet, but instead the timing of money coming in and going out of your bank account.

Sales Forecasts:

The sales forecasts you’ve done are formulated to carry forward to your ‘Cash in’ – providing an estimate of cash in your business. This helps demonstrate any terms you may provide to your customers for payment.

example; If you agree to accept payment in 30 days, a sale in February will show up as cash to your business in March under line item “Accounts Receivable”

Cash Flow Gaps:

If at the end of your lists, you see cash flow gaps, places where you may be short on funds during a specific time of the month / year, you may need to consider alternative financing (factoring) to help cover those gaps.

Remember sales may vary during peak sales season vs low activities that can occur during slower times of your business cycle or even when vacationing takes place.

Accounts Receivable:

Accounts receivable is a legally enforceable claim for payment held by a business against its customer/clients for goods supplied and/or services delivered in completion of the customer’s order. These receivables are generally in the form of invoices raised by a business and delivered to the customer for payment within an agreed time frame. Accounts receivable is shown in the business balance sheet as an asset.

Factor Financing Receivables:

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.

Compare Invoice Financing Offers.. Free:

It’s recommended that you get a few competitive offers when deciding which factor finance company best fits your business financing needs. Factoring your receivables will help your business access immediate source of funds and cover any problematic cash flow gaps.

Factor Bid:

Factor Bid is a free online resource for small to mid-sized businesses. Visit www.FactorBid.com to get started comparing offers from competing finance companies to buy your accounts receivable invoices for immediate cash. No more waiting Net30 or Net45, get paid for your accounts receivables within 24-48 hours.

It’s Friday, “direct deposit day” (payday)

If you’re a business owner, you’re familiar with the excitement that comes with Fridays around the office. Employees are getting ready for the weekend and are exited for their paycheck! Some employees even get their check as “direct deposit” early Friday morning before work even begins.

What’s this mean for business owners – Payroll expenditures! See for business owners payday isn’t always as consistent and predictable as Friday employee pay is. Business owners have to wait for payment from customers and often times end up covering payroll and other daily business expenses right out of their own pockets.

Wouldn’t it be nice if your business could get paid on outstanding receivables before the work day even begins? 

What if you could have the same great feeling every Friday that your employees feel. Well you can! If your company is feeling the cash flow ‘squeeze’ from slow-paying customers and you want to get back on that good vibe kind of feeling when it comes to getting paid, then take a look at factor financing your receivables.

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Cash Flow “Squeeze”

What is Factor Financing and how do I get paid in 24 hours?

Companies sell their invoices or accounts receivables to specialized companies called factors. The factor advances most of the invoice amount upfront by simple direct deposit. You can get paid within 24 hours of invoicing your customers. Factoring will continue to provide your business with predictable cash flow everyday of the week, even Fridays so you’re able to cover payroll and other expenses without digging into your own pocket.

Be excited for Fridays, meeting payroll with confidence shows your business is a success. They always say “people sell people”, so if your employees are instrumental in helping drive new customers and maintain existing accounts then paying them is a good sign that your business is growing and on it’s way to becoming a great success.

Is your business Mobile? Check out Factor App – for invoice financing on the Go!

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Factor App for iPhone

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