Invoice Factoring Offers Alternative To Bank Loans
A sale is not a sale until you collect the money
. The time between issuing an invoice and collecting on it can be a sparse financial time for any company. During this time, the business has fit the bill for the supplies, time, and resources used to supply a client with the product or service. Now, that business must find a way to cover operating expenses until the invoice has been paid in full. This, unfortunately, can take anywhere from thirty to ninety days before a business sees any in-cash flow. There are two options in this scenario. Either take out a painful, stipulation laden bank loan, or find an invoice factoring provider.
Invoice factoring is a process whereby a business sells its current, unpaid accounts receivable to the factoring provider. This gives the business cash, up front, to take care of operating expenses like covering payroll, buying supplies, and paying benefits and workers compensation. Invoice factoring allows businesses to attain the funds they need based on the amount of money they anticipate on receiving from clients.
Businesses of all sizes can utilize invoice factoring, but they can be most useful for small to mid-sized businesses or businesses that are relatively new. Most businesses in financial crisis look to bank loans for the funds they need. But businesses that are too new to have a financial-track record, weak balance sheet, history of financial problems, that are in turnaround mode, or undergoing big changes, are often unable to find a willing lender at any price.
Restrictive lending requirements for cash flow, equity, profitability, and years in business can also hinder a mid-sized to small business from getting the loan they need. Even if a business has a solid history, if times are tough, banks and finance companies limit lending. Invoice factoring offers options beyond the restrictive offers of loans. It is an effective cash management tool that can save businesses from going under.
Invoice factoring is the smart option, sometimes the only option, for companies to stay in business. Invoice factoring is a way for businesses, with credit problems or other cash flow issues, to get the money they need to pay their expenses and keep their business growing.
From day-to-day operating expenses and taking advantages of trade deals to purchasing equipment, invoice factoring funds can be used for any business need. It is an effective cash management tool that can help a business stay up and running without having to worry about collecting on invoices. Every business that offers services before true payment is at risk of running into financial problems. If your business needs help making it through a financial dry spell, you need a dedicated invoice factoring provider to get you the cash you need.
Bay View Funding is a factoring company that solves cash flow and receivables management issues by creating a personalized invoice factoring program. They offer credit lines up to 2.5 million dollars and advance rates up to 97 percent of face value of invoice. Bay View Funding will take over your billing, collection and customer credit monitoring needs, leaving you with more time to grow your business.
by: Ava.hudson
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