How you tried doing business with government or commercial customers? If you answered yes to that question, that means that you are also used to waiting up to 60 days to get your invoices paid. Big companies tend to pa slowly and this is one of the most challenging facts when you do business with them. They take their own sweet time to do it but they do pay all right.
There are, however, expenses that you have to pay now. Suppliers need to be paid. Payroll must be met. For both small and medium sized businesses, this would create a big challenge.
Is the solution a business loan? Not usually, no. They are hard to get. Because you can only get one loan at a time, your hands are tied until the loan is paid off when you do get them. So if you need more money because your business grew, then you are out of luck.
If slow paying customers is your biggest headache, then a better solution would be to factor your receivables. In order for you to pay employees, suppliers, and taxes, receivable factoring will provide you with the necessary financing. Above all, by eliminating or at least minimizing your financial worries, you will also be provided with peace of mind.
When it comes to receivables factoring, they work on a simple premise. You can finance your invoices as they are valuable assets. The factoring company would basically wait until your customer pays and they will advance money for your slow paying invoices. Of course, for this service, they will also charge a small fee. Keep reading to learn how this works.
Your work should be done as usual. You bill your customer but then submit a copy of the invoice to the factoring company for financing
The factoring company provides you an immediate advance on 70% to 90% of the invoice (there is a 10% to 30% reserve). That money can be used to meet payroll and to pay expenses.
The factoring company waits to get paid by your customer
Once they are paid, the transaction is settled and the factoring company rebates any reserves
As you can see, factoring gives you immediate money for your slow paying invoices, enabling you to run and grow your business. It's not that difficult to qualify for factoring. Doing business with credit worthy customers is considered as the biggest requirement. If your customers are slow paying but are good, then you can finance them.
A great tool to finance your business and grow it to the next level is receivables factoring.
There are, however, expenses that you have to pay now. Suppliers need to be paid. Payroll must be met. For both small and medium sized businesses, this would create a big challenge.
Is the solution a business loan? Not usually, no. They are hard to get. Because you can only get one loan at a time, your hands are tied until the loan is paid off when you do get them. So if you need more money because your business grew, then you are out of luck.
If slow paying customers is your biggest headache, then a better solution would be to factor your receivables. In order for you to pay employees, suppliers, and taxes, receivable factoring will provide you with the necessary financing. Above all, by eliminating or at least minimizing your financial worries, you will also be provided with peace of mind.
When it comes to receivables factoring, they work on a simple premise. You can finance your invoices as they are valuable assets. The factoring company would basically wait until your customer pays and they will advance money for your slow paying invoices. Of course, for this service, they will also charge a small fee. Keep reading to learn how this works.
Your work should be done as usual. You bill your customer but then submit a copy of the invoice to the factoring company for financing
The factoring company provides you an immediate advance on 70% to 90% of the invoice (there is a 10% to 30% reserve). That money can be used to meet payroll and to pay expenses.
The factoring company waits to get paid by your customer
Once they are paid, the transaction is settled and the factoring company rebates any reserves
As you can see, factoring gives you immediate money for your slow paying invoices, enabling you to run and grow your business. It's not that difficult to qualify for factoring. Doing business with credit worthy customers is considered as the biggest requirement. If your customers are slow paying but are good, then you can finance them.
A great tool to finance your business and grow it to the next level is receivables factoring.
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