Factoring receivable is the secret to maximizng your cash flow.
Receivable factoring is your company’s most valuable asset. Why give up any ownership of your company or borrow money long term when you can finance your invoices for immediate cash?
What is account receivable factoring? Factoring receivable invoices is the sale of an asset – your invoice. The sale of your invoices to a third party – known as a Factor – eliminates the sale-to-collection business cycle of waiting for payment. A factor will purchase your invoices for up to 90% of the total amount. You get your cash now and the factor takes on the risk of collecting the payments from your customers. The creditworthiness of your customers is very important if you want to get a good rate from a factor.
What are my specific advantages?
- Immediate cash with no waiting and without incurring new debt: You receive quick payment following invoicing
- To factor, your business credit rating is not an issue because you are not borrowing money
- Efficient handling of all your invoicing and data entry
- Relief from the responsibility for collecting no-pay and slow-pay clients
- You have expanded growth capacity through increased production
and total sales
- Ability to take advantage of vendor discounts