Five Myths About SMB Invoice Financing, Debunked!

5 myths about invoice financing debunked:

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Myth: 1 – Expensive – “A rate of 1.2% per month equates to 18% annually. That’s a very high interest rate compared to what my bank will give me.”
Debunked – True, rates are around 1.2% per month. However, receivables financing can offer no origination fees, no prepayment fees or un-used line fees often seen with a traditional line of credit. There is also no commitment; you can finance as needed. While rates on a traditional loan may be lower, the terms and conditions of the loan may cost you more in the long run, including the waiting and time to get funds.
Invoice Financing is based on the creditworthiness of your customers, instead of your business’s credit. This means if you’re working with larger clients that are more established, factoring will enable you to extend terms to remain competitive amount your competitors.

Myth: 2 – Appearance – “A company that sells invoices is in trouble with traditional sources of credit, and needs alternatives lending to keep the doors open. This may show my customers that we have very slim margins and are not making a ton of profit off of the business relationship.”
Debunked – Invoice Financing grows with your business. Traditional lenders like banks tend to look at the past and have stringent requirements and paperwork to qualify for a commercial loan. Financing your receivables actually keeps up with growing sales volume by extending you larger amounts of upfront capital as your accounts receivables increase. Invoice factoring is fast and makes your company more flexible to meet the demands of larger customers.

Myth: 3  Customers Relations – “I have been doing business with customer-ABC for the past 4 years and don’t want to jeopardize our relationship by adding a 3rd party payment collector. A financing company will pester my customers for payment, which will damage the client relationship.”
Debunked – As business professionals your clients understand that when you’re factoring it’s because you’re extending terms so they can pay you at a later date. They’re essentially using your money to grow their business faster, so you may as well use the factor finance company’s money to grow your business faster.  Some factors will also stay out of the transaction all together, this type of option is very popular among transportation freight brokers.

Myth: 4 – Too Early for Credit – “Our new SMB business has little to no credit history, and as a result we can’t get financing from our local bank. We heard that Invoice Financing companies have the same credit requirements!”
Debunked – Invoice Financing companies base their decision using your customers payment and credit history, not yours. Your customer (the debtor) is the one responsible for pays the invoice, so factor finance companies are mostly interested in their creditworthiness overall.  Larger, Fortune 1000 companies and government entities are the best customers for a small business to factor finance their receivables from because there is plenty of information publicly available to check their payment and credit history, allowing a vendor to piggyback on their credit rating, while increasing their own business credit history more quickly.

Myth: 5 – Loss of Control – “All payments coming to my business are routed through a 3rd party. I lose control of my accounts with a factor finance company. Plus I get stuck in contracts that restrict business rather than helping.”
Debunked – True, payments need to be made by your customers directly to the financier’s account. This is done for security purposes; the invoice is collateral for the advanced funding, and your factor finance company collects from the customer when they pay. At the same time, not all Invoice Financing companies are created equal.
When factoring, only customers that you want to finance must make accounts payable to your factor finance company. Receivables from customers that you choose not to finance can still pay you directly in the agreed upon time frame, usually net-30 or longer. All factor finance companies are a little different. With some there is not long term contracts and you can sell the receivables you want, when you want, which works great for seasonal business and oversize orders. Having to deal with a delayed payment cycle can strain existing resources and add unnecessary stress to your business. Debunking the myths of invoice financing can bring working capital to your business quickly and open new opportunities for many B2B and B2G small businesses.

Ready To Start: – Make sure that you’re getting a few offers from competing factor finance companies before you begin. Visit www.factorbid.com and within an hour you’ll have competitive offers to earn your business an buy your accounts receivable invoices for immediate cash. Factor bid is fast and easy and only takes about 2 minutes to start. You’ll be contacted by a few of the top factor finance companies that specialize in your specific industry within the hour of completing your customer application. You’re under no obligation to factor. Check out factor bid and get the knowledge and leverage you need to get the best deal when factoring your accounts receivables for immediate cash flow!

On The Go – Download Factor App – for fast and easy invoice financing!

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Here is what you need to ask yourself when seeking more profit from your business

A businesses desire to scale shouldn’t be entirely based on demand for their product or service. Demand will certainly play a large roll in how or when a business will scale. To Scale your business effectively means anticipating demand, not reacting to it.

If a company acquires two or three new clients and then realizes it can not fulfill their demands, business growth efforts are likely to collapse. This kind of activity leaves room for competition to move in and service unhappy or under-serviced customers.

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Predictable cash flow provides a business the flexibility it needs to stay competitive, grow quickly, fulfill new customer demands and generate more profit.  Do you know what your predictable cash flow is?

How Does A Business Realize Predictable Cash Flow:

Build in sustainability and scalability in order to make sure future cash flow is predictable. Examples;

  • Lock in customers – Offer incentives, sign contracts, improve customer experience to ensure customers are incline to work with you over the long haul.
  • Implement a consistent sales and marketing process – Design a process, train  your sales staff, put performance metrics in place and hold your team accountable.
  • Make delivery of your products and services scalable and repeatable – learn from your mistakes, identify cash flow gaps within your sales cycle and figure out how to eliminate existing problems.
  • Free up cash flow from slow paying customer accounts – Factor finance your accounts receivable invoices to get money your customers owe you today, instead of waiting 30 or more days.
  • Once future cash flow becomes more predictable, fulfilling new larger client accounts and efficiently servicing existing client accounts becomes much easier.

Don’t worry about the cost of doing business along the way. It takes money to make money and scaling a business successfully is challenging; mistakes will be made and you may even overspend occasionally. Learn from your previous business activity and implement a strategy to avoid similar mistakes the next time around. Hire people to help you strategize, attend local small business events to discover new ideas and most of all keep a positive frame of mind.

To get access to immediate working capital you may need to pay as you go so you can profit as your grow! Leverage assets within your business, like your accounts receivable invoices or promised payments, so you can increase cash flow and go after larger new customer accounts.

*Free Small Business Finance Resource:

When you’re ready to unlock money trapped in your accounts receivables, visit www.factorbid.com to compare invoice offers to buy your invoices. Factor bid is a free service for small businesses. Factors compete for the opportunity to earn your business and buy your invoices. You’ll get the knowledge and leverage you need to negotiate the best deal and most money when factor financing your accounts receivable invoices.

 

On-time cash flow, the difference between growing business or going out of business

Working capital in today’s fast paced business world is proving to be a necessity. You gotta have cash today or face the consequences tomorrow.

Use to be that money on the books meant you really had nothing to worry about, right? Customers owe you money, you invoice those customers for payment and eventually when they get around to it, you get paid. They promise you payment, you promise others payment and so on and so forth.

So businesses start running accounts payables based on outstanding receivables, anticipating payments from extending terms to their customers and then budgeting their financial responsibilities accordingly. Until this happens.., your customers slow-pay or worse- don’t pay altogether. Now what? You’ve got bills due, promises to keep and you’re expecting that check; but now your customer is telling you you’ll have to wait.

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Waiting on accounts receivable payments can add a huge amount of stress to a business, not to mention the business owners. Many businesses run on razor thin margins in order to stay competitive, and don’t have the funds in reserve to finance slow-paying customers or cover payments for customers that don’t pay.

Take a look at your business operations today. If even one of your top 3 customers didn’t pay, could you continue to operate at the highest level of business operation or would it send your business in a downward tailspin of financial distress?

REDUCE, REDUCE, REDUCE and REPEAT

Reduce your liability in open accounts receivables. Reduce the amount of time spent collecting money owed to your business for goods and services that you’ve already delivered. Reduce bad-debt by unlocking capital trapped in your open accounts receivable invoices.

Factor finance companies have lots of money. They want to share their money with you and get you paid immediately for your invoices, usually within hours of invoicing your customers. Factors don’t mind waiting 30, 60 or even 90 days for your customers to pay up. They make a little bit of money by assuming responsibility of collecting the owed money and keeping your cash flush and on-time so you can keep running your business at the highest and best level.

Factoring your invoices enables you to get paid immediately. Think what you could do with more working capital right now.

  • Pay off higher interest loans
  • Purchase new equipment to increase productivity
  • Hire additional employees to help bring in new customers
  • Pay suppliers in advance to receive discounts on your purchased orders
  • Invest the money to expand your business model and generate additional income

However you decide to use your money, accessing it within hours of invoicing your customers will give you the leverage you need to stay competitive and grow your business brand much faster.

Choosing the Best Factor Finance Company in 3 Simple Steps

  1. Go to www.Factorbid.com
  2. Click “Get Started” button
  3. Choose the best available finance offer available today

Factor Bid gets you competitive offers from the top finance companies in that specialize in your industry. You’ll quickly be matched with the best rate, terms and offers today. Factor Bid is real-time and when finance companies now they’re competing for your business, they’re going to give you their most competitive offer right away or face loosing your business to one of their competitors.

Get the knowledge and leverage you need to negotiate the best financing deal for your growing business. Don’t risk not getting paid or the stress that comes with financing your customers while their businesses flourish and yours waits to be paid. Trade in those outstanding invoices for immediate cash flow and focus your time on gathering new customer accounts, not collecting money from completed work.

Factor Bid is a free online business resource for small to mid-sized business. You’re under no obligation to finance. Try it today to find out how much working capital your business can access!

Supply Chain Finance – Entrepreneurs start, run and grow your business

Weather you’re a tier 1 or tier 2 type vendor or a supplier company that sells goods or services to other businesses in the economic production chain, chances are you’ve experienced slow-pay in your company’s accounts receivables. But is this a problem for most operating businesses looking to grow their market share?

Proven Financial Resource

Invoice financing is used all over the world by companies large and small. Entrepreneurs unfamiliar with the idea of selling invoices at a discount to increase cash flow may be under an immediate assumption that a company selling their invoices is in trouble with traditional sources of credit and needs alternatives to stay afloat.

That’s not entirely true. Here’s why, invoice financing uses your company’s assets to access immediate cash. Invoices are considered assets because they’re money that your customers owe you for goods and services you’ve already delivered. Your credit is not even part of the lending decision when a factor finance company partners with your business. A factor is looking at the creditworthiness of your customers when deciding on investing in your business by buying your invoices for immediate cash.

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Flexible and Fast Access to Working Capital

Business like invoice financing because it’s flexible and grow with your business. You can access larger lines of funding as your business needs, or scale back and factor less during times when you don’t need more working capital.

Accessing cash tied up in receivables enables your business to keep up with growing sales volume and meet the demands of larger customers. Larger customers require longer time to pay and stretch out payments to 60 days or longer sometimes, leaving your business with substantial carrying costs.

Lower Company Liability and Increase Cash Flow

Redirect the responsibility of carrying and financing your customers by partnering with a factor finance company. A factor assumes the responsibility of your outstanding invoices; the liability that goes with potential non-payment of your receivables and the time it takes to collect money owed to your by your customers.

Let the factoring company finance your customers growth. Free up money owed to your company and put that money to work immediately. Waiting around to be paid is not a smart business practice. Factoring will help increase your working capital immediately so you can grow faster, take on more new customers, payoff higher interest rates or buy supplies at a discount price. As your profits grow, so will your bottom line. The cost of factoring becomes a cost of doing business and as long as you’re making more money at the end of the year and increasing market share within your industry then factoring is a smart business decision and you now can see why companies of all shapes and sizes are using it.

Stop wondering how your competitors are growing so quickly and start taking advantage of your accounts receivable assets. Get the cash you need to grow your business faster.

Recommended that you get a few Competitive Offers

It’s recommended that when selecting a factor finance partner you get a few offers from competing factors to earn your business and buy your invoices. Factor Bid is a free small business resource that enables you to compare invoices finance offers from competing factor finance companies in real-time. Visit Factor Bid, click the Get Started button and within the hour you’ll have competitive offers from the top factor finance companies eager to earn your business and buy your invoices for immediate cash.

Don’t wait 30,60 or even 90 days to be paid while your competitors push ahead and win more new customers, get paid within hours of invoicing your customers and use your working capital to stay competitive in your industry.

Business on the go Mobile Work force

If you’re business is on the go and you’re looking for the fastest and easiest way to connect with financing, download Factor App and within a few minutes you’ll be matched with the top finance companies competing to earn your business.

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A nickel ain’t worth a dime anymore (business cash flow)

Money owed or tied up in accounts receivables is worth less to your business and even creates problematic cash flow gaps, whereas your business is loosing profits or declining in value by carrying/financing your customers growth, while your business waits to be paid.

Let’s increase your business cash flow with assets that already exist (accounts receivable invoices). Keep reading and discover how making your money work for you today is worth more than money paid in the future, or simply skip to our website and get started now unlocking money tied up in your outstanding receivables!

Money is vital for any business. Without it, your business can’t grow from small operations into something bigger. To understand what your business capital is and how it really works is crucial to being a successful entrepreneur and business owner.

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Outside the banking world, most business owners are not familiar with different types of capital available to bank roll business expenditures. A deeper understanding of financing and a popular financing option know as factoring will better help you manage daily and long term business finances.

Invoice Factoring – is the selling of invoices to a third party (called a factor) to improve cash flow and reduce bad debt. Receive an immediate boost to cash flow, while at the same time eliminating the need to process invoices.

Benefits of Invoice Financing (factoring)

  • Increase Cash Flow
  • Cover Payroll Expenses
  • Pay Suppliers early for discount pricing
  • Pay off higher loans / tax liens
  • Fulfill larger orders
  • Pursue bigger client relationships
  • Grow your business faster
  • Reduce bad debt as the third party buyer assumes risk if the invoice is not paid

Financial Health of your Business and Working Capital – Working capital is money you need to cover basic operating expenses in your business everyday. Expenses include payroll, inventory purchases and carrying of accounts receivable (money customers owe you).

Let’s determine how well your business is doing. We do this by finding out the working capital ratio of your business. The ratio is a good indicator of your company’s financial health and can tell you a lot about the direction your business is heading. You’ll also discover if you have enough short-term assets to pay off short-term debt you business might produce.

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Rule of thumb –  your current assets should be higher than your total current liabilities, which provides you with positive cash flow and positive working capital. If you are experiencing negative working capital, due to slow-pay accounts, large payroll costs, new expansion costs and/or additional accounts payable supply costs then your business may be experiencing cash flow gaps and even heading in the wrong direction.

Some ways to counteract negative cash flow and increase working capital ratio are to cut inventory, collect on outstanding or slow-paying accounts receivable invoices faster and pay bills a little more slowly.

Factoring can help your business now by collecting money owed in accounts receivables today. When you decide to factor invoices, you’ll have immediate access to more working capital and are able to focus on growing your business faster, instead of back-peddling and trying to figure out how to slow business growth or liquidate assets and supplies need during profitable cycles.

As long as your business is making more money than the cost of factoring is costing your business, then using a factor finance company’s money for a small fee is absolutely worth it. Stop financing your customers growth while your company lags due to slow paying or late paying customer accounts.

Factors are in the business of making money. They have a good deal of experience and knowledge in your industry and most likely will help your business grow even faster than you’ve experienced in the past.

It’s recommended that you get a few competitive offers when selecting a factor finance partner to work with.

Factor Bid – Compare invoice finance offers.. Free! Use www.factorbid.com to quickly and easy match your invoices with the top factor finance companies that specialize in your industry and are eager to buy your invoices for immediate cash.

Is your business on the Go? Download our financing app and get started accessing cash tied up in your receivables today!

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When Factors Compete To Buy Your Invoices, YOU WIN!

Factor Bid – Invoice Finance Offers

 

Source Quote Credit “A nickel ain’t worth a dime anymore”

 

Quick Guide to Invoice Factoring – Factoring enables you to turn the money customers owe you into working capital

Working Capital | Business Cash Flow

What is Invoice Factoring – Invoice factoring (also called accounts receivables financing and invoice discounting) is a smart business fiance tool that gives your business immediate access to monies your customers owe you, on the same day an invoice is generated, so that you don’t have to wait 15, 30, 60, 90 – days or longer -for customers payments.

Access to cash that’s tied up in your accounts receivable invoices enables you to reinvest working capital into your business more quickly.

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Benefits of Factoring Invoices:

  • Take on more new customers
  • Expand your business operations
  • Cover payroll and hire more new employees
  • Pay suppliers to receive a volume purchase discount
  • Pay off higher interest loans and equipment financing
  • Take on bigger orders more quickly
  • Cover day-to-day operating expenses

Having the ability to access immediate cash and increase working capital will help your business grow more quickly, keeping you competitive and relevant in your industry.

How The Factoring Process Works:

  1. Your business generates a customer invoice. Instead of waiting weeks or months for the customer to pay-
  2. Factor the invoice with your factor finance partner and get same day funding up to 98% of the total amount of the invoice, for a small fee – which could be as low as 1% of the amount of the invoice.
  3. Once your customer pays the full amount of the invoice, the amount held in reserve is also returned to you, minus the factoring fee.

Why Use Factor Financing For Your Growing Business?

Factoring enables you to turn the money customers owe you into working capital, that you can use for your business today. There is not need to wait weeks – months for the chance of customers to pay, instead free up working capital immediately.

More Working Capital Enables Your Business To:

  • Offer generous credit terms to your clients as a competitive advantage
  • Leverage purchasing power to negotiate discounts with suppliers and vendors
  • Improve your ability to meet day to day expenses
  • Take on new customers or fulfill larger orders
  • Reduce accounting -related costs
  • Reduce your companies financial risk from bad debt with non-recourse factoring

A factor (in a non-recourse factoring agreement with your company) assumes the credit risk for the factored invoices. If a customer is unable to pay for credit reasons, the factor will absorb the loss, not your business!

There is also recourse factoring agreement, which is less expensive, because your company assumes more risk. With recourse invoice factoring You may also be required to repurchase invoices that remain unpaid by your customers and cover your own legal or collection costs in collecting payment from non-paying customers.

Common Reasons Business Owners Use Factoring:

  • Slow-paying customers that are creating a cash flow crunch
  • Customer accounts with extended terms, stretching out payment due date
  • To offer longer payment terms for customers, to attract new customers and/or match what competitors are already doing
  • Need access to immediate working capital to take advantage of emerging business opportunities – like taking on bigger clients or fulfilling larger orders
  • Speed up cash flow to meet operating expenses
  • Expedite cash flow to take advantage of supplier vendor quick-pay discounts
  • Reinvest money tied up in receivables more quickly
  • Grow their business faster in order to increase their market share within their industry
  • Make a larger return on investment each year
  • Utilize the experience of the factor finance company to help organize and deploy a more efficient bookkeeping and collection cycle

If you’re ready to see how much more money your business can access every month by factoring your accounts receivable invoices, then simple click the Get Started button at our www.Factorbid.com website.

Factor bid quickly matches your business with factor finance companies that specialize in your industry and are eager to earn your business and buy your accounts receivable invoices for immediate cash.

At factor bid -you’ll receive a few competitive offers from factor finance companies. Review each offer and decide which offer is the best fit for your business.

Factor bid is fast, easy to use and secure. Spend a fraction of the time (locating the top factors) and receive the knowledge and leverage you need to negotiate the best financing deal for your company.

Factor bid is free for business owners and you’re under no obligation to factor. Find out what your financing options are within a few minutes at Factor Bid.

On The Go! – Download Factor App – to get started comparing offers!

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Nurse Staffing Factoring (invoice finance) competitive offers

Nurse Staffing Factoring and the benefits for your growing staffing organization without adding any new debt to your books.

Tired of waiting months on end to be paid for your temporary nurse staffing services? Is your ability to meet payroll, hire new temporary nurses and new business expansion being affected by slow-paying clients? If yes, you’re not alone. In fact that’s why nurse staffing factoring exists.

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Nurse Staffing Invoice Finance – It’s easier than you think! Your nurse staffing agency can get the cash flow it needs quickly and without accruing any additional new debt or compromising your present obligations to payroll, taxes and vendor invoices.

The healthcare services industry continues to thrive and grow quickly. Take advantage of financing and give your company a chance to compete with other industry nurse staffing agencies in your market and local area. Grow your staffing agency at a higher percentage by accessing immediate capital and the benefits and flexibility that come along with it.

Factor finance companies understand the unique challenges faced by agencies staffing nurses in;

  • Hospitals
  • Medical clinics
  • Nursing homes
  • Long-term care facilities

Even the most well managed, profitable small to mid-size nurse staffing agencies experience cash flow gaps and some difficulties as rapid growth occurs, due to clients extension of payment on term invoices.

Easy steps to follow when seeking capital for nurse staffing agencies invoices:

  • Staffing Nurses, the factor verifies the invoice(s) and checks the credit of any potential new client prior to funding invoice(s).
  • Funding is available within 24 hours upon verification of invoices.
  • Nurse staffing agency’s clients pay the factor direct for purchased receivables.
  • Once the client has paid the invoice, the factor will release the reserve, minus any factoring fees.

Instant payroll funding is available for different nursing industries;

  • Private duty
  • Homecare staffing
  • General Nursing staffing

Stop stressing over slow-pay customers. Factor finance your invoices and focus on growing your business in the already rapidly expanding healthcare services marketplace. Don’t miss out on large opportunities because you can’t meet payroll and other weekly operating expenses.

*Choosing the right factor finance company can be difficult. However smart nurse staffing agencies use Factor Bid to get a few competitive offers for their invoices. When factors know they’re competing for your business, you get the best deal! Visit www.Factorbid.com and find out within a few minutes which factor finance company has the best offer for your invoices.

 

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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Invoice financing, also know as factoring, helps companies get cash in exchange for their outstanding accounts receivable invoices.

Could your business benefit from an injection of new cash flow? Invoice financing, also know as factoring, helps companies get cash in exchange for their outstanding accounts receivable invoices.

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How does invoice factoring work?

There is no big secret to factor financing (selling your invoices for immediate cash). To access invoice financing a business simply needs to providing goods and/or services to other creditworthy businesses on terms (invoicing)

What does the typical Factor Financing cycle look like for your business?

  • Once you’ve completed your service or delivery of goods you’ll invoice customers as usual.
  • Depending on how much capital your business needs to access, will determine which customer invoices you decide to factor.
  • You’ll submit your open invoices to the factor along with any additional supporting docs you’ve agreed to provide for specific customers.
  • Within 24 hours of verification, the factor finance company will wire or ACH up to 85-95 percent of the gross invoice to your account.
  • In the normal course of business, check from your customers will continue to be payable to your company, however may be mailed to a specific mailing address that your factor finance company has set up. There are also other ways a factor will accept payments on your behalf – this is an important detail you need to discuss with your new factor finance partner.
  • Once the factor receives payment from your customer (in full) they will post it to your account. They then remove the amount that was initially advanced to you (to cover what they fronted you) plus their agreed upon fee.
  • You’ll receive daily comprehensive accounting information so you can review the factors advances and customer payments.
  • You’ll also have access to a suite of tools that can help you check the creditworthiness of potential new customers you’re considering working with.

Factoring your outstanding invoices is a symbiotic relationship for your company and the factor finance company. Factoring is not like a bank loan, where you need to put up personal equity or credit. The factors are using your receivables as collateral and the more your business grows the better you and your factor finance company does.

Also don’t forget that factoring your invoices and getting paid within 24 hours for your open invoices reduces your liability in collecting outstanding, late or non-payments from your customers. Make sure you talk to your factor finance company about non-recourse factoring vs recourse factoring before deciding which type of agreement is best for your business needs.

Now that you’re ready to start factoring – visit www.factor.bid to get a few offers from competing factor finance companies for your open invoices. When factors compete you get the best deal. Factor bid is free, enjoy!

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