Ten Reasons Why You Could Use Invoice Finance Or Factoring For Your Business
Turnover is vanity, profit is sanity and cash is reality or so the saying goes.
In fact cash is king!
You can rapidly improve your business cash flow by utilising factoring or invoice finance. The majority of small business failures are actually a result of cash flow and not profit problems.
What are the reasons for introducing for introducing factoring or invoice finance?
- It's a swift and simple process
- You generate immediate working capital
- You can get up to 90% of your invoice value received with in 24 Hours
- Your available funds grow as your business sales increase
- They provide regular cash flow which allows for you to develop firm plans
- You can increase your marketing efforts to facilitate growth
- It's an important source of capital that's not a loan
- Benefit from reduced stress levels caused by having insufficient cash to meet your business obligations
- The funds available are based around the financial strength of your customers and not simply your business or personal credit rating
- You can offer better credit terms to customers allowing you to attract more business
If that sound interesting and you would like quotes – we have suppliers who would like to talk to you.
No matter what your situation; whether you're a new business, or perhaps you're enjoying healthy growth and increasing sales, or you're considering expansion; unpaid invoices can really hamper your business development. Whatever the position of your business the last thing you need is unreliable cash flow.
To find out more about how factoring or invoice finance could help you business download our Buyers Guide - click here.
Or you could simply get quotes now.
Questions and Answers
There are various types of factoring available. These factoring can be in any industry viz. account receivable factoring, asset based lending, business loans, construction factoring, credit card receivables factoring, distributors factoring, equipment, hard money loans, invoice factoring, manufacturing,
Factoring accounts receivables can improve cash flow and provide opportunities that cash on hand can provide. Cash flow is critical for most small business's to be successful. If your waiting 30 to 60 days for payments you could be missing out on the full potential of your business model. When invoice factoring is employed your cash is in hand within one day of invoicing, eliminating boosting the cash flow of business.
If you're looking for cashflow solutions then this article demonstrates that the headlines costs are not the cost you need to think about when considering invoice discounting or factoring. There are a number of hidden cost that you must consider if you wish to fully appreciate and compare Invoice Finance quotes and offers, not to mention quality of service.
The easiest way to visualise how factoring and invoice discounting work is to imagine that as soon as you have made a sale to a customer, you can then immediately 'sell' your unpaid invoices to the lender at their full face value. This article covers how the full process works.
I read an interesting article at the weekend which says that SMEs currently have nearly £16bn worth of sales invoices that are four months in arrears. Surprisingly almost half of them have done nothing to improve their cash flow. The research, carried out by NatWest and RBS shows that 71% of SMEs in the UK have suffered from late payments. I'm a little surprised that this is as low as it is - my experience is that all SMEs suffer from late payments!
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The key reason why some firms thrive while some implode during an financial recession is still a puzzle to many people business-owning business owners. Some wrongly assume that all businesses should suffer via recessionary cycles. But the truth is that some companies are usually essentially recession-proof, and it is not necessarily because they are much larger, better known, or a lot more generously capitalized.
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