Invoice Factoring Company

Read The Entire Contract Before Entering Into An Invoice Factoring Arrangement

2009-04-22T01:05:00.000-07:00

Many companies who are in a cash flow bind, either because of poor profitability or accelerated growth, need a financing option that isn?t dependent upon their credit standing or internal financial ratios. Factoring is the obvious choice for entities in this situation because the focus for underwriting is on the credit worthiness of the client?s customers.

It should be made clear to the client at the onset of the relationship that the factoring company typically expects invoices to be factored for a period of time, usually for a year. In other words, there is a minimum amount of fees that will be charged whether the company factors invoices or not.

This is not usually an issue, as most companies that take advantage of factoring tends to use the service for one to two years. At that point, they usually have found a way to secure other financing. Other companies, however, need only a ?shot in the arm? by a one-time infusion of cash. For those firms, factoring may not be for them. They will be charged fees during the contract period for services that aren?t being used. On the other hand, having a steady stream of cash by not having to wait 30-60 days to collect receivables can be advantageous.

It is incumbent upon the factoring company?s representatives to clearly explain how the factoring process works. It is also imperative that the client and/or their attorney to review the commitment letter and contract in its entirety so there will be no surprises.

Kent Harlan has been a CPA since 1984 and has provided consulting, accounting and financial services to several industries. He is the owner of Ozarks Capital Funding, LLC, a Springfield, MO based company offering financing in the areas of accounts receivable factoring, equipment leasing, asset based lending, and healthcare provider. He is an active member in the Missouri Society for Certified Public Accountants and has written several articles for the Springfield Business Journal.

email: kenth@ocflink.com
Website: http://www.ocflink.com

Factoring Companies: Learn the Top 7 Financial Questions to Ask to Choose the Best One for Growth

2009-04-14T00:59:00.000-07:00

A factoring company advances funds to your business based upon the dollar amount of your company's outstanding account receivables. With a quality factoring firm, you no longer have to wait to receive money owed to you by clients. Each accounts receivable factoring firm may charge different fees, though. Here are the high level questions to ask each company to find the best situation for your firm.

Ask the following questions of your prospective factoring companies:

1. Ask each invoice factoring company how they determine fees to spot the best deal.

The fees that you would pay to accounts receivable factoring companies are based on the financial strength and credit worthiness of your customers. Specifics include:

How often you bill your customers,
how long your customers have been in business and
how quickly your customers pay your invoices.

2. Ask invoice factoring companies for a favorable advance rate and quickly increase your working capital.

When working with a factoring firm, you will submit outstanding invoices to them. They will then provide your business with cash based upon your "advance rate." Customary advance rates range from 75% to 90%, which means you would receive between $750 and $900 for each $1,000 of outstanding invoices submitted.

3. If an invoice factoring company offers you a "flat fee rate" ask about the implications and make the right choice for your business.

While flat fees may seem less complicated, the end cost can be substantially higher. With a flat-rate fee, the cost is the same whether the receivable is out for 10 or 60 days so, unless most receivables are out 45-60 days, the overall cost makes this type of rate more expensive.

4. Ask an invoice factoring company these questions about contract terms to avoid costly termination fees:

Is there a contract term,
how long would my contract term last,
is there an early termination fee,
is my contract automatically renewed if I don't cancel in writing and
if so, how much advance notice to cancel do you require?

5. Not all receivables factoring companies are alike: ask potential partners if they work with all clients.

Some receivables factoring companies, for example, will not fund companies with a high concentration, i.e., if their business is dependent upon one or two clients. Other companies do consider clients with concentration and they usually examine risk levels to determine a rate.

6. Make a savvy financial decision: ask about specific fees charged by receivables factoring companies.

Ask prospective factoring firms about the cost of the:

Application fee,
Due diligence fees,
Credit reporting fees,
Background or lien search fees,
Factoring company lock box fees,
Minimum monthly volume fees,
Charges to add a new receivables factoring client,
Early termination fees from receivables factoring contract,
Upfront advance fee and then an interest fee,
Fee for same day advances,
Monitoring fees,
Automated clearing house (ACH) fees and
Wiring fees.

Some invoice factoring firms have a flat rate fee that includes all services, except for the monthly Internet access report fee.

7. Ask how factoring companies calculate interest charges and choose the most favorable.

Some factoring firms begin charging interest as soon as an invoice is issued. Under this system, you could end up paying several more days' worth of interest than if your factoring company began charging interest on the date you receive funds. Also ask factoring companies if you can select what day of the week to receive your funds and pick what's best for your company.

Select a quality invoice factoring company now: get immediate funding to grow your business.

Now that you have the tools and knowledge to evaluate factoring companies, you can decide which factoring company will grow your business the fastest. Don't miss out on lucrative business opportunities because of poor cash flow any longer! Contact companies and get your factoring loans to get growing now.

Gage Price is President of MP Star Financial, an invoice factoring company. Gage worked his way up through the ranks as an invoice factoring salesperson and underwriter and received his MBA from New York University's Stern School of Business. Find out how to grow your business at MPStarFinancial.com.

Read The Entire Contract Before Entering Into An Invoice Factoring Arrangement

2008-07-22T01:59:00.000-07:00

email: kenth@ocflink.com
Website: http://www.ocflink.com

Factoring Companies: Learn the Top 7 Financial Questions to Ask to Choose the Best One for Growth

2008-07-22T01:56:00.000-07:00

Ask the following questions of your prospective factoring companies:

1. Ask each invoice factoring company how they determine fees to spot the best deal.

The fees that you would pay to accounts receivable factoring companies are based on the financial strength and credit worthiness of your customers. Specifics include:

How often you bill your customers,
how long your customers have been in business and
how quickly your customers pay your invoices.

2. Ask invoice factoring companies for a favorable advance rate and quickly increase your working capital.

3. If an invoice factoring company offers you a "flat fee rate" ask about the implications and make the right choice for your business.

4. Ask an invoice factoring company these questions about contract terms to avoid costly termination fees:

Is there a contract term,
how long would my contract term last,
is there an early termination fee,
is my contract automatically renewed if I don't cancel in writing and
if so, how much advance notice to cancel do you require?

5. Not all receivables factoring companies are alike: ask potential partners if they work with all clients.

6. Make a savvy financial decision: ask about specific fees charged by receivables factoring companies.

Ask prospective factoring firms about the cost of the:

Application fee,
Due diligence fees,
Credit reporting fees,
Background or lien search fees,
Factoring company lock box fees,
Minimum monthly volume fees,
Charges to add a new receivables factoring client,
Early termination fees from receivables factoring contract,
Upfront advance fee and then an interest fee,
Fee for same day advances,
Monitoring fees,
Automated clearing house (ACH) fees and
Wiring fees.

Some invoice factoring firms have a flat rate fee that includes all services, except for the monthly Internet access report fee.

7. Ask how factoring companies calculate interest charges and choose the most favorable.

Select a quality invoice factoring company now: get immediate funding to grow your business.

Healthcare Staffing Factoring: How to Improve Your Cash Flow (Part One of Three)

2008-07-12T01:21:00.000-07:00

In a world where it is becoming increasingly more difficult for a nurse staffing agency to receive timely payments from their customers, accounts receivable factoring can come to the rescue. Selling their invoices at a discounted rate, also known as factoring, gives healthcare staffing companies the money they need to help maintain and grow their staffing operations. Instead of waiting 30, 60, 90 days or longer for payment from their customers, factoring provides the cash needed to meet payroll, pay taxes, purchase software and/or increase staff. And all of this can be accomplished without increasing debt on a firm's balance sheet, which could limit future healthcare staffing financing alternatives. Healthcare staffing funding is best be utilized to bridge the gap between when an invoice is issued and when payment is received.

Another reason why nurse staffing agencies should look into selling their receivables is that factoring companies do not base their funding capabilities on a business owner's personal credit or even the company's credit history. Rather, companies providing healthcare staffing invoice factoring are most concerned with the creditworthiness of the nurse agency's clients, who are also called account debtors; to pay them after the invoice has been sold. A traditional bank, on the other hand, would be less concerned with the agency's customers. From a banker's perspective, it's the business owner's personal credit and the company's operating and financial history that will determine whether or not they would approve any loan amount.

With that said, there are literally thousands of factoring companies to choose from, all of which offer distinct advantages and disadvantages. The most important question to keep asking while searching for an accounts receivable factor is: "Will this factor best be able to meet my company's needs?"

Keeping that key question in mind, factors can generally be divided into three different operating categories. First, there are large factors that operate nationally and are able to fund clients across numerous different industries. These factors usually work out of multiple offices, and they are set up to cater to the needs of very large businesses. Because of their size and national presence, these factors are capable of funding almost any kind of company, from staffing to manufacturing to transportation. These factors are true generalists both across industries and geographic regions.

Then there are some factors that focus their operations in one specific geographic region. These smaller local factors have a home field advantage so to speak, in which their clients find comfort in the fact that their factor is literally around the corner. These factors will generally fund a wide variety of businesses; however they will all be concentrated in a definable geographic region.

The final category is comprised of factors that concentrate their funding in one specific niche (i.e., healthcare staffing invoice financing), offering a heightened level of industry expertise to their clients. Their customers are generally national in scope, but are focused on a small handful of industries. These factors' clients feel more comfortable knowing that their funder understands the unique characteristics of how their industry operates. PRN Funding is just one example of an industry-specific factor because we focus on healthcare staffing invoice funding, namely for medical staffing agencies, medical transcription services, medical coding companies and medical supply businesses.

The size of your business, the services/products that you provide and whom you sell to all play a part in choosing between the three types of factors. Whether or not you should go with a general or industry-specific factor, a national or a local one, one that funds larger companies or one who works with start-ups all depends on what you want for your own company. It all goes back to that original question, "Will this factor best be able to meet my company's needs?"

Stay tuned for the next article in this three-part series, which will discuss the differences in rates and fees among factors and teach you how to compare and contrast to find the best factor for your staffing business.

Philip Cohen is the founder and president of PRN Funding, LLC, which is an extraordinarily focused niche player in the health care services funding market place. Through a process known as factoring, PRN Funding provides business owners with the financial resources needed to grow and effectively compete in the industry. With no minimums or fixed terms, PRN Funding provides medical staffing agencies with flexible and immediate access to capital. We give you the freedom to factor what you want, when you want, whom you want, for as long as you want. Prior to founding PRN Funding, Mr. Cohen was an executive officer of The MRC Group, a national provider of Medical Transcription Services. Contact Philip Cohen at toll-free 866.776.5407 or via email at pcohen@prnfunding.com/. Please visit PRN Funding, LLC on the web at http://www.prnfunding.com

Healthcare Staffing Factoring: How to Improve Your Cash Flow (Part One of Three)

2008-07-03T23:48:00.000-07:00

Credit Card Processing - Credit Card Factoring Solutions

2008-06-26T23:07:00.000-07:00

Credit card processing is frequently one of the most problematic and overlooked issues for a business owner. An effective credit card factoring program can reduce many credit card processing problems by implementing appropriate cost-reduction strategies. Credit card factoring improvements can produce dual business benefits by both eliminating credit card processing problems and providing improved cash flow by enhanced management of business cash advance programs.

CREDIT CARD PROCESSING AND CREDIT CARD FACTORING SOLUTIONS: Reduce Credit Card Processing Costs Via the Credit Card Factoring and Business Cash Advance Process

As I noted in an earlier business loan article, for any business that accepts credit cards as a method of payment, a business cash advance (obtained through credit card factoring) is a critical working capital financing tool that is often overlooked. Even thriving businesses frequently need more working capital than they can borrow from a bank. However, what is typically even more overlooked by many business owners is the opportunity to reduce their credit card processing costs at the same time that they obtain a business cash advance via credit card factoring.

CREDIT CARD PROCESSING AND CREDIT CARD FACTORING SOLUTIONS: Key Problems to Avoid with Credit Card Factoring and Credit Card Processing

Credit card factoring is an important option to consider when a business is seeking short-term commercial loans, unsecured business loans and improved approaches to credit card processing services. Unfortunately there are a number of problems to be avoided with credit card processing and credit card factoring programs. As with any successful business financing strategy, there will typically be only a small number of commercial lenders who are effective at implementing the joint tasks of credit card processing and credit card factoring strategies properly.

Because of this, the prudent choice of an appropriate provider of credit card processing and credit card factoring is extremely important to any business owner that accepts credit cards. To help demonstrate which providers of credit card processing and credit card factoring to avoid, I have written an article which identifies ten key problems which should be avoided with credit card factoring and credit card processing.

CREDIT CARD PROCESSING AND CREDIT CARD FACTORING SOLUTIONS: How to Obtain The Best and Lowest-Cost Credit Card Processing Services

For business owners either unhappy with their current credit card processing services or simply wondering if cost improvements are viable, a credit card factoring program which eliminates all of the ten key problems noted above should be considered. One of the primary reasons for evaluating credit card processing and credit card factoring in this coordinated fashion is that the low-cost producers of the best business cash advance programs will almost certainly be using the best and lowest-cost producers of credit card processing services. In many cases, the best and lowest-cost providers of credit card processing are simply not available to the average business owner other than as part of a working capital management plan encompassing both credit card factoring and credit card processing.

CREDIT CARD PROCESSING AND CREDIT CARD FACTORING SOLUTIONS: Cost Reduction and Improved Cash Flow for Successful Working Capital Management

Business owners should not lose sight of the substantial total benefits which might accrue to their business by effectively combining credit card processing and credit card factoring services. As noted above, cost reduction and improved cash flow are primary goals of successful working capital management, and the proper coordination of credit card factoring and credit card processing should accomplish both of these difficult goals simultaneously.

Stephen Bush is the CEO of AEX Commercial Financing Group, LLC. Steve provides working capital loan and church financing assistance throughout the United States. Information about free online Business Financing Reports and a free online Commercial Real Estate Financing Course is available at select AEX Commercial Financing Group, LLC websites.

How Cable Installers Can Benefit From Factoring Receivables

2008-06-20T22:41:00.000-07:00

The cable installation business can be very profitable ? if managed properly. Most cable installers operate as subcontractors for large telecommunications or cable companies, such as AT&T, Adelphia or Comcast. This can be a great business model that makes a tidy profit for the cable installer. These companies make great customers and provide constant work and reliable payments.

Although working for large companies can be a great source of revenue, business owners need to get used to the fact that they pay their invoices 30 to 60 days after the work is completed. That means that as an owner, you must cover all payroll and all other business expenses while waiting to be paid. This can be tough, especially for new or growing businesses.

When faced with a cash flow challenge, most installers go to their bank hoping to get some business financing. However, they soon learn that getting a business loan is very hard. As a matter of fact, few loans are ever granted to cable installers. Fortunately, business loans are not always the best solution to this problem. In fact, there is a solution that works better than a loan. It is called factoring.

Factoring receivables can provide you with a reliable and predictable cash flow. It provides you with a substantial advance on your invoices, ensuring that you have funds to pay employees and suppliers. Receivables factoring works as follows:

1. You perform the work and send an invoice to the Cable or Telecommunications company

2. You send a copy of the invoice to the factoring company. The company provides you with an immediate advance. The advance will be between 75% and 85%

3. Once your client pays the invoice, the factoring company will give you with a second advance (the remaining 15% to 25%), less a small service fee

The fee will vary based on how much you invoice per month and can range from 1.5% to 3% per month.

One of the most attractive features of factoring invoices is that it is easy to obtain. Most cable installers will qualify provided that they do business with good customers (such as large cable companies) and are free of problems. Factoring invoices is an ideal solution for both established and new companies and can help propel your business to the next level.

About Invoice Factoring Group / Commercial Capital LLC

Searching for factoring companies? We are a leading factoring company and can provide you with a competitive accounts receivable factoring quote. For more information call (866) 730 1922.

Factoring & Account Receivables

2008-06-16T22:40:00.000-07:00

All too often, small businesses that are just starting out experience cash flow issues that make it difficult for them to meet their financial obligations. Creditors are less lenient with new businesses than they are with businesses that have been established for an extended period of time.

Entrepreneurs that are just embarking into the business emporium are dependent on their account receivables for their business to thrive, it?s crucial to the life of their business. Most creditors or vendors, offer very short payment terms to new businesses, others work strictly on a C.O.D. basis. When account receivables don?t get paid in a timely manner, these small businesses suffer cash flow issues that result in their inability to meet their own financial obligations.

New business owners have few options available to assist them in fulfilling obligations to their creditors, not to mention in house obligations such as payroll, rent, and utilities.

Factoring account receivables is not the most cost effective solution for businesses to resolve their account payable issues, but often times it is the only resource they have. Many small businesses choose factoring as a temporary solution to get them through the rough spots, until they can assess the capital necessary to qualify for financing.

Factoring is a form of financing that businesses utilize. A business can sell it?s unpaid invoices to a finance company to expedite cash flow. This is how it works.....

A business may turn over unpaid invoices to a finance company.

The finance company will purchase the invoices.

The finance company will advance the business monies, (usually in the form of a wire transfer) less their percentage and collateral.

The collateral is put into a restricted account until all invoices are satisfied.

When the invoices are satisfied, the finance company releases the collateral from the restricted account to the business.

If the invoices are not paid (generally Net 90), the business loses the collateral and is required to repay the finance company their original investment in addition to any finance fees incurred.

Although factoring is a risk, many entrepreneurs are willing to take such risks in an effort to sustain the business until their business becomes financially stable. Many businesses overcome these financial obstacles, unfortunately there are many that can not recover, as a result these businesses fail.

So why would a company choose to factor it?s receivables? Businesses can quickly turn their unpaid invoices into cash. All invoices are not necessarily submitted for factoring. A business may choose to turn over only a portion of their invoices to be factored, generally those they consider slow pay accounts. The down side is that the business usually receive only 80 percent of the face value on each invoice.

Account receivable factoring has become increasingly popular for businesses that experience difficulty in securing a loan in the traditional manner from a bank. This is a vital resource for small businesses in today?s economy. Many of the larger corporations are also utilizing factoring of their account receivables as a resource to generate quick cash.

Donna Vestre is the President/CEO of South Coast Revenue, a Recovery Consultants Firm based in Anaheim California. To get more information on Credit and Collections, or to submit an article for inclusion in the "Guest Speakers Lounge" please visit http://www.SouthCoastRevenue.com

How Factoring Receivables Can Help Your Business Grow

2008-06-11T02:20:00.000-07:00

Do you have commercial or government clients? Working with commercial and government clients can be very profitable. However, these clients also tend to pay invoices in 30 to 60 days, which can drain your company?s working capital. Many times, these great but slow paying customers can drag your company?s performance down.

If your working capital is tied in slow paying customers, eventually you?ll have to start turning away new sales. Even worse, you may miss payroll or key supplier payments. Before long your company will be stuck in neutral or about to enter a death spiral. The solution, of course, is to obtain some working capital.

Going to the bank for business financing (e.g. a working capital business loan) is tricky and won?t work for most business owners. Banks usually require 3 years worth of financial statements, detailed business plans and will take months to make a decision. In the end, you may ? or may not ? get the capital you need. However, if your biggest challenge is that your customers take up to 60 days to pay their invoices, you should consider factoring your receivables.

Factoring receivables enables you get an advance on your slow paying invoices. This provides you with the necessary working capital to make new sales, meet payroll and pay rent. And as opposed to conventional bank financing, invoice factoring is easy to obtain and quick to set up.

Factoring financing is easy to use. It works like this: 1. You deliver your product/service to your customer

2. You submit the invoice to the factoring company for financing

3. The factoring company advances you up to 85% of the invoice as the first payment

4. Once your customer pays for the invoice, the remaining 15% is advanced, less a small service fee

Factoring services fees can range from 1.5% to 3% per month, depending on your business volume and other criteria.

There are a number of advantages to using factoring. For starters, it?s relatively easy to qualify for the service. The biggest requirements are that you work with reputable customers and run a good business. And it?s also easy to setup. Usually you can get financing in just a few days. All of these features make receivables factoring a great alternative for new and established companies.

About Commercial Capital LLC
Interested in factoring receivables? We can provide you with a competitive accounts receivable factoring and receivables factoring quote. For information call Marco Terry at (866) 730 1922.

How Factoring Companies Can Help Staffing Companies Grow

2008-06-09T00:13:00.000-07:00

One of the biggest challenges for staffing company owners is meeting payroll. Employees must be paid every week ? without exception. However, paying employees can be very difficult if an agency does not have predictable or reliable cash flow. What is worse, waiting for a payment from a slow paying client can seriously jeopardize the agency?s ability to function.

This situation, unfortunately, is quite common in the staffing industry.

What is the solution? When owners or managers face slow cash flow their first instinct is to try and get business financing from their local bank. However, they soon learn that getting a business loan is very difficult. Most banks require that the owner have an extensive business history, spotless personal credit and substantial collateral. Unfortunately, small businesses seldom qualify for business loans.

Nevertheless, there is an alternative that can help you finance you staffing agency. It?s easier to obtain than a business loan, can be set up in days and is available to most business owners. And, it provides staffing agencies predictable cash flow.

The solution is called invoice factoring. Factoring provides you with an advance on your invoices from slow paying clients. That advance ? available soon after you invoice for your work ? can be used to cover payroll and other expenses. In effect, factoring receivables provides you with predictable cash flow enabling you to better operate your staffing company.

How does invoice factoring work? Well, it?s a simple solution. It works as follows:

1. You deliver a copy of the time sheet and invoice to the factoring company

2. The factoring company advances up to 90% of the invoice within 24 hours

3. Once the invoice by the customer the transaction is settled

Factoring fees can range from 1.5% to 4% per month and are based on your business volume and other criteria.

One of the most attractive features of factoring is that it is easy to obtain. Most staffing agencies will qualify provided that they do business with good customers and are free of problems. Factoring invoices is an ideal solution for both established and new companies and can help propel your business to the next level.

About Invoice Factoring Group / Commercial Capital LLC

Searching for factoring companies? We are a leading factoring company and can provide you with a competitive accounts receivable factoring quote. For more information call (866) 730 1922.

How The Factoring Industry Works

2008-05-31T02:20:00.000-07:00

One of the biggest problems in any growing business is the long delay it typically takes to get paid. It is not uncommon for it to take 60 to 90 days from the time a company completes a job or contract to the time when the company actually gets paid. Ninety days is almost an industry standard interval from receipt of a service or goods by a large commercial customer to the time that payment is sent out.

In the meantime, the companies' employees are expecting to get paid on time; which is usually weekly, and most of the operating expenses need to be covered on a monthly basis. Some of the bills even need to be paid right up front. It can be tough for a growing or new company to make ends meet before the 90 days are up and the payments start coming in.

To help cover this financial gap an industry called factoring has emerged. Let's use an example to explain how factoring works. Let?s say company A makes and sells super computers. They make a computer, sell and ship it to company B and soon after send out the bill for the computer. Now by standard industry practice, company B usually does not have to start making payments for 90 days. This is where factoring enters in. A third company, company C, is the factoring company. The factoring company is usually a financial institution or bank of some sort. The factoring company pays company A up to 85 percent of what is owed them by company B right up front then and there. They hold out a percentage, usually 15 percent, to cover any disputes that may arise between A and B. Once company B gets around to paying for the super computer, the payment gets sent directly to the factoring company. Company A never sees the check sent out by company B. Basically company A's accounts receivable are transferred to the factoring company. The factoring company then sends the 15 percent that was held out to cover disputes to company A, minus their factoring fee for all of this. The factoring fee is usually 1.5 to 2 percent. They basically cover company A for the payments that are owed them. They act as an intermediary between A and B to help smooth everything out financially.

Of course, a big consideration for the factoring company is the financial reliability of A and B. If B is very reliable and pays its bills on time, then the factoring company will probably give company A better factoring fee rates. If A's super computer is very reliable and never causes problems for its customers, then the factoring company will probably reduce the amount it holds out to cover disputes.

So why wouldn't company A simply borrow money from the bank? Actually, factoring is a specifically targeted way of borrowing money. Because it is an ongoing relation between A, B and the factoring company the rates are generally lower and the amount that A can borrow is generally more compared to a basic bank loan. Plus, it gives A more time to spend making super computers; and less time worrying about collecting bills.

Michael Russell

Your Independent guide to Factoring

Construction Factoring

2008-05-30T00:03:00.000-07:00

Perhaps no other major industry is better suited to factoring than the building and construction industry. For many years, the peaks and valleys of construction seasons and cycles have troubled subcontractors and general contractors alike. Now factoring offers a cost effective and simple solution that can benefit both the contractor and the factoring company. Many factoring companies have even gone for far as to specialize in factoring for the construction industry, learning the unique language and needs of subcontractors.

Generally, banks and construction subcontractors don't get along with each other. Construction is a risky business and banks are only interested in safe, reliable clients. If the contractor is new and growing, or does not have several years of positive cash flow, banks won't even let the contractor in the door let alone give them a business loan.

There are many reasons why construction is so financially volatile, but one of the main reasons is the time delays and cost overruns; that are almost a given in construction. You almost never ever hear of a building being completed on time and under budget. The architect and client inevitably change the plans along the way, causing increased costs and construction delays. If you are the plumbing subcontractor for the new town school and the local school board decides to change the plans after it is started, you truly have no idea when you will get paid. In the mean time, the plumbers that work for you are expecting to be paid weekly - and you are expected to order and have on hand all plumbing materials needed for the school. The bank won't help the plumber, but factoring companies are perfectly suited to this situation. By purchasing the plumbing subcontractors accounts receivable, for a small factoring fee, the subcontractor can continue on with their business. Both the construction subcontractor and the factoring company benefit.

Another problem with the construction industry is the scope and number of projects that can be handled at one time. Building a building is a big deal. A contractor simple can't take on more than a small hand full of projects at a time. And buildings are expensive. Contractors don't have the resources to take on more than a couple projects at a time. Most other industries don't have this problem. For example, a company that builds and sells vacuum cleaners can make thousands of vacuums every day, with only a small amount of the companies' resources and capitol invested in each individual vacuum. After a while, cash flow evens out and business is relatively steady. Construction companies can't do that. If problems with a project get to be too much for the poor plumbing company, they may have to go out of business. On the other hand if Mrs. Jones has trouble with her vacuum cleaner, the vacuum company can easily replace it without having to go out of business. Again, the bank won't help the plumbing company but factoring companies are designed to handle just this type of ebb and flow in construction.

Factoring companies can't change the nature of construction. Construction will always be subject to massive peaks and valleys and each project will be a huge investment of resources and capitol for contractors. Because of this, the factoring fees tend to be a little higher than with other industries - for example 3 or 4 percent versus 1 or 2 percent. And the amount withheld to cover disputes is usually closer to 25 percent rather than 15 percent. But for the construction subcontractor, this is usually a small price to pay for the peace of mind of knowing they won't have to file for bankruptcy.

Michael Russell Your Independent guide to Factoring

Factoring Receivables - Working Capital For Growing Businesses

2008-05-28T23:46:00.000-07:00

If you sell goods/services to other businesses or to the government, then you know that commonly you have to wait 30 to 60 days to get paid for your services. Unless your business is well capitalized, waiting to get paid can drain your working capital and affect your business.

Lack of working capital can prevent you from making new sales, forcing you to sentd customers to your competition. What is worse, if the problem is not corrected, it can affect you ability to pay employees or suppliers. Missing payroll and supplier payments is a sure indication that a business is in serious financial troubles. The solution to this problem is, of course, simple. You just need to get business financing.

Obtaining business financing (such as a line of credit or business loan) is easier said than done. If you go to a bank, they will require that you provide them with three years audited financials and a solid business plan. That kills any chances of financing for most startups and new businesses. There is, however, an alternative form of financing that can help you get working capital. And, it almost always works better than a business loan. It is called factoring financing.

Invoice factoring provides your business with a substantial advance on your slow paying invoices ? sometimes up to 85% of what you have invoiced. You can use the advance as working capital to cover new sales orders, payroll or supplier payments. Factoring receivables provides you with relief form slow payments and provides you with the working capital you need to grow.

Factoring receivables is simple to use and works as follows:

1. You provide the product/service to your client and send an invoice to them

2. You send a copy of the invoice to the factoring company

3. The factoring company advances you up to 85%. This is your first installment

4. Once your client pays, the remaining 15% (second installment) is advanced, less a small service fee

The fee you pay will be based on the sales volume that you finance and the credit quality of your clients. Fees can generally range from 1.5% to 3.5% per month.

On of the big advantages of factoring receivables is that it is easy to obtain and can be set up in a few days. Most new and established businesses can qualify easily. The biggest requirement to qualify is that you must do business with reputable clients or government entities.

About Commercial Capital LLC
Interested in Factoring Receivables? We can provide you a competitive accounts receivable factoring and receivables factoring quote. For information, call Marco Terry at (866) 730 1922.

Receivables Factoring Companies are Your Tool to Improve Cash Flow Management and Grow Today

2008-05-28T00:16:00.000-07:00

Invoice factoring advantages: imagine how you could grow your business with excellent cash flow management.

When you partner with invoice factoring companies, you can receive payment on your customer invoices within 24 hours of billing, freeing up your company's cash flow. So, by not investigating factoring companies, you may be limiting your options. Read on for some of the benefits of working with a receivables factoring company and then contact a quality firm today.

Immediate benefit of receivables factoring: solve payroll and other staffing issues with your improved cash flow management.

You can stop robbing Peter to pay Paul and meet payroll and payroll taxes without scrambling to collect on overdue accounts. This reduces your stress, makes your employees happy and allows you attract and retain the best staff possible.

Enhance your credit rating, simplify collections and receive better pricing deals: other benefits of working with a factoring company.

Partnering with a factoring company improves your cash flow. This allows your business to:

pay bills on time,
which boosts your credit rating;
buy in bulk, often at a lower cost per item,
take advantage of early pay price discounts,
upgrade equipment to more cost efficient models and
offer longer payment plans to your customers, which can expand your client base.

Now, let's go beyond the basics and discover how factoring companies allow you to expand services, increase service areas and fund product research and development.

Factoring companies give you the freedom to expand services into potentially lucrative areas.

Now that you're confidently managing cash flow, experiment with new service areas. If, for example, you deliver lunches to businesses, begin offering breakfast. If you're printing shop forms, working with a receivables factoring company can free up cash for you to expand and improve your equipment and your services.

Expand your service area and reap the profits: another benefit of partnering with an invoice factoring company.

You can now increase your number of clients, in your current service area or in a new one. Consider adding a city to your advertising and service efforts. Or if you're offering a limited program of services, offer those services that you've been considering, but have lacked the capital to implement.

Final factoring company benefit: fund product research and development with your improved cash flow management.

Research and development often gets put on the back burner as you pay bills, recruit qualified staff, and attend to day-to-day business. Because of the improved business model created by your receivables factoring company, you can now begin the product development that was once only a dream.

Now put your knowledge into practice: choose a quality factoring company today and expand your business products and services.

If you're not exploring how receivables factoring can improve your cash flow and expand your business you may be missing out on lucrative business opportunities. Make a commitment to your company's growth today by selecting a quality invoice factoring firm and arranging factoring loans today.

Gage Price is President of MP Star Financial, an accounts receivable factoring company. Gage worked his way up through the ranks as an invoice factoring salesperson and underwriter and received his MBA from New York University's Stern School of Business. Find out how to grow your business at MPStarFinancial.com.

Selling Steel Reinforcing Bars (Rebar)? Lear How Factoring Can Help You Grow

2008-05-27T00:02:00.000-07:00

Companies that sell reinforcing steel bars (or concrete bars - also known as Rebar) have seen a boom in recent years. Many cities have seen a surge in residential and commercial real estate projects, which in turn has increased the demand for Rebar.

Companies that sell, cut and bend Rebar have profited nicely from this growth ? however, they have also faced a common problem in the industry. The problem is tight cash flow. Basically, they sell the Rebar to customers (e.g. builders, contractors) at good prices. These customers usually pay their invoices in 30 to 60 days. In the meantime, the Rebar company must wait to get paid while covering all supplier, payroll and rent expenses. Many times, this is not sustainable. Either the company stops growing, or worse, it starts missing key supplier or employee payments.

Going to the bank to get business financing is not always the best solution. Why? Banks seldom finance companies in the Rebar industry. And before they finance a company, they need to see a detailed business plan, three years worth of company financials and owners with good personal credit. Also, they take months to make a decision. However, there is a better solution problem ? the solution is to factor your receivables.

Factoring receivables provides your company with an immediate advance on the slow paying invoices. This gives you the necessary cash to pay suppliers, employees and rent. And as opposed to bank financing, invoice factoring is easy to obtain.

This is how accounts receivable factoring works:

1. You sell the Reinforcing Bars to your client. You send them an invoice

2. You send a copy of the invoice to the factoring company, who advances you up to 85% of its value

3. Once the customer pays for the invoices, you get the remaining 15%, less the service fee

Factoring companies charge differently for their services, but the cost is generally anywhere between 1.5% and 3% per month. Price varies based on financing volume and on the quality of your invoices.

The biggest difference between factoring financing and bank financing is that factoring is very easy to obtain and quick to set up. Most companies can obtain a substantial line of financing in as little as 5 days. Although not widely used in the reinforced bar industry at this time, it?s an ideal source of working capital that is quickly gaining popularity.

About Commercial Capital / Invoice Factoring Group
We provide financing for Rebar manufacturers and dealers. To learn how factoring receivables, construction factoring or accounts receivable factoring can help you grow your business ? call (866) 730 1922

Invoice Factoring Helps You Expand Your Company With Fast Business Funding

2008-05-24T00:12:00.000-07:00

Choose invoice factoring business funding to expand your company at all stages: profit and thrive. Each stage of your business comes with unique benefits and challenges. No matter the stage, though, working with a quality receivables factoring firm can support business growth. In this article, we will share the benefits of invoice factoring when you are poised to expand your business, but face cash flow management issues. We'll also discuss how working with a factoring firm can help with start up businesses.

First, see if you identify with these challenges often faced by established business owners who want to expand their company:

Cash Flow Management Problem #1: Traditional business funding from banks does not meet your needs. You apply for a line of credit but it is not approved. Or, it is not approved for the amount you need.

Invoice Factoring Solution #1: With factoring business funding, you receive funds within 24 hours of invoicing your customers; cash flow problem solved!

Cash Flow Management Problem #2: You mull over taking in a partner or investor, but you feel uneasy. You started this business and you hate the idea of giving up control of its destiny and future.

Receivables Factoring Solution #2: Using an invoice factoring company, you remain in control and you can parlay your new cash flow abilities into an expanded business.

Cash Flow Management Problem #3: You worry about losing your well-trained quality staff during expansion. You appreciate the quality of your current staff and you need them to recruit, hire and train new staff. But, because of cash flow issues, making payroll may be a struggle, or you can't always budget for the seminars or training tools they request.

Invoice Factoring Solution #3: A factoring company provides the business funding you need to recruit and train new staff while retaining your star employees.

Contact a quality receivables factoring company and solve your business expansion challenges. You can hire more staff, meet current financial obligations and grow your business to new heights. Now read on to discover how invoice factoring specifically helps with start up companies.

Stop worrying about business financing help for your start-up company: find a quality receivables factoring company and relax. As the owner of a start-up business, you worry about everything. You drive all aspects of your company, but may still not break even. You need better cash flow, but struggle to get traditional bank funding. Consider switching your business funding strategy and contact a factoring firm today. Factoring offers the improved cash flow you need to make your business a success.

Find solutions, not hassles, when you contact an invoice factoring company for business financial help. Problem #1: Traditional bank funding usually requires 2 to 3 years of business financials; if you do not have that, then a bank loan is unlikely.

Business Funding Solution #1: Factoring is based upon your outstanding receivables, not the length of time that you have been in business.

Problem #2: Traditional bank financing requires acceptable collateral and your house is mortgaged, so that is not an option.

Business Funding Solution #2: Receivables factoring is not based on the value of your property or equipment, but on your receivables assets.

Problem #3: Your company services two or three solid customers, but the bank sees that as high concentration (business focused on too few customers), so they will not lend you money.

Business Funding Solution #3: Find a quality invoice factoring company that will fund new businesses -- even start-ups -- with high concentration.

Choose invoice factoring and receive immediate business financing help. No matter how new your business, if cash flow is an issue, then contact a quality receivables factoring firm today. If you have more questions, find a reputable receivables factoring company and discuss the positive benefits of invoice factoring for your company's business financing help.

? 2007 MP Star Financial
By Gage Price, President of MP Star Financial, Inc.

Find out how to grow your business at MPStarFinancial.com.

How Freight Factoring Can Help Trucking and Logistics Companies

2008-05-23T00:18:00.000-07:00

Owning a trucking company or logistics company (freight brokerage) can be very profitable. At the same time, transportation companies tend to be cash hungry. There are fuel expenses, employee expenses, operator expenses, repair expenses and many other expenses that need to be paid quickly. However, most customers don?t offer quick-pays and usually pay their freight bills in 30 to 60 days.

This creates a major challenge. Why? You have expenses that need to be paid quickly and customers that want to pay slowly. Unless your company has some available funds, you will most likely run into problems.

Many company owners try to address this cash gap by trying to get business financing from their bank. However, they soon learn that banks seldom provide business loans to small transportation companies. Unfortunately, a business loan is not an option for most logistics and transportation companies. So, what is?

In many cases, trucking companies have an option that is better that a business loan. It is called invoice factoring. Factoring can provide logistics companies with the financing they need to meet their current expenses and grow. And, as opposed to bank financing, factoring is easy to obtain and can be setup in about a week. So what is factoring? Factoring provides companies with an advance on your slow paying freight bills. This enables them to meet expenses while waiting to get paid by customers. It works as follows:

1. You company delivers the load and invoices the customer 2. The factoring company provides you and advance of up to 90% of your freight bill 3. You can use the advance to meet all expenses 4. Once your customer pays, you?ll get the remaining 10% less a small factoring fee

The cost of factoring can be anywhere between 1.5% to 3% per month. The cost is determined by your industry, the quality of your customers (who pay the freight bills) and the amount of financing you require. Freight bill factoring is a great solution for logistics and trucking companies and can help grow your company to the next level.

About Invoice Factoring Group / Commercial Capital LLC
Looking at factoring companies? We can provide you a competitive factoring and freight factoring quote. For more information, call (877) 300 3258

Factoring For The Small Business

2008-05-22T01:38:00.000-07:00

Cash flow is critical to all businesses, but it can be of particular importance to small to medium-sized businesses that have been only been established for a few years. They often find themselves in the working capital 'trap' of having plenty of potential business opportunities, but not enough cash available to exploit them. Factoring can be the perfect answer in this situation.

Factoring provides cash for the business as soon as an invoice is issued. It also has substantial benefits in terms of reducing management time spent on accounts receivables. There are two other important aspects of factoring that are useful to the growing business:

- They do not require personal guarantees

- They work with your customers' creditworthiness, not your own

How does factoring work?

After the initial setting up of your account with a factoring company, you will issue invoices in the normal manner, but they will be stamped to show that they are payable to the factor. The factor will then provide you with immediate access to funds, typically about 80% of the face value of the invoice. The balance will be credited to your account (less a small service charge) when the cash is actually collected.

From that point on, the factor will take over responsibility for managing your sales ledger and accounts receivable. The very fact that they are involved will usually bring about a reduction the time taken to pay invoices, as supplier know that factors often report delinquent payment performance to the major credit reporting agencies, whereas companies supplying the services do not.

Factoring companies are very careful about selecting and training people to handle collections professionally, as they are acutely aware that the task must be handled sensitively but firmly. They understand that customers are the lifeblood of your business, and that they need to maintain their goodwill toward you.

A good partnership with a factoring company can be one of the most valuable assets of a developing business, particularly in the early years, when there can be a danger of over-trading if adequate working capital is not available.

Andrea Lucas is CEO of Celera Financial, LLC, and has over 20 years? financial experience working with small and medium-sized businesses, both internationally and in the USA. Andrea can be reached by email at info@accountsfactoring.com or call (703) 651-3168. Website: http://www.celerafinancial.com

Factoring invoices| accounts receivables| invoice factoring company

2008-05-21T03:14:00.000-07:00

Factoring, invoice factoring, or accounts receivable financing means selling your company's invoices at a discount to a finance company for immediate capital. Factoring makes it possible for your company to utilize funds that otherwise would not be available during a normal billing cycle.

In other words, invoice factoring or selling of an {a rel="nofollow" href= http://www.magfinancial.com/faq.cfm} accounts receivable invoice to a "factor" helps your business obtain the cash flow it needs. Prior to that there are a few key points to be emphasized:

* Elimination of bad debt: A non-recourse factor presupposes the risk of bad debt, thus eliminating this expense from the business' income statement.

* Invoice processing: In invoice factoring, "factors" usually handle a majority of the work associated with processing invoices. This includes posting invoices, depositing checks, producing regular computer reports and entering payments.

* Unrestrained capital: Invoice factoring is the only source of financing that grows with your sales. This means that as sales increase, additional money becomes instantly available. In this way, your business constantly grows and is also able to meet increasing demand.

* Advantage of timely payment: In your business transaction you can save 2 - 5% of your raw materials cost since you have the money to pay within ten days. In addition to volume purchasing, you can considerably lessen the true cost of factoring.

* Avoid early payment discounts to your clients: Since you are receiving your money without delay, you do not have to offer early payment discounts. Factoring will save you every dollar in discounts that your clients are currently taking.

* Don't give up equity: Invoice factoring ensures that you do not have to give up any equity in the company or take on any partners with factoring.

* Don't invite any additional debt: People have a misconception that factoring is a loan. This is not true; {a gref= http://www.magfinancial.com/factoring.cfm }invoice factoring<a/> is not a loan. Therefore, your business will not incur any additional debt.

In invoice factoring, the first transaction usually takes 3 to 5 days. Once the account has been set up, cash can be advanced toward your invoices to your bank. People mistakenly believe that there are monthly obligations with invoice factoring. As factoring is not a loan there is no debt repayment. Moreover, you are in control of how much you factor and when, depending on your personal {a rel="nofollow" href= http://www.magfinancial.com/cash-flow-program.cfm}cash flow needs.

If you are looking for an invoice factoring company that will help your company grow, then Magnolia is there for you. For more information on factoring, factoring invoice discounting, invoice factoring company and receivable management, please visit www.magfinancial.com.

Mr. Scott Stevens is well known author who writes about financial services such as cash flow programs, account recievables, factor recievable etc. Find more information about magnolia financial service at www.magfinancial.com

Factoring: Accounts Receivable, Cash Flow and Factoring Invoice

2008-05-20T04:01:00.000-07:00

If you own a flourishing business, you are probably aware of the importance of factoring invoices. The expression 'factoring invoices' sounds ubiquitous but what exactly does it mean and is it useful? These questions frequently cause confusion, but factoring invoices is easy to understand.

Factoring is the exchange of a company's commercial invoices or accounts receivable into immediate cash. This is done by selling those accounts at a discount. With invoice factoring, you can easily get 70 to 80% of an invoice's face value wired to your account within 24 to 48 hours of the invoice being issued and approved. It's an easy way to get ready cash.

There is a misconception that invoice factoring is a kind of loan. This is absolutely wrong, as with factoring you pay neither interest nor principal. Invoice factoring is not a loan. The main benefit of invoice factoring is that no liability will appear on a company's balance sheet due to factoring; furthermore, it financially revitalizes the business.

In invoice factoring, a company sells one of its assets or accounts receivable for an agreed-upon 'fee' to obtain a more liquid asset, cash. In short, it is a kind of self-financing, having its own growth with debt-free funding; it is like selling your vehicle to someone- the two of you agree on a price and the transaction is finalized.

As factoring invoices is not a loan, funding is not based on a company's ability to repay the amount advanced, but on the ability of the company's customers to pay what is owed the company for the purchase of its goods or services. Nowadays people prefer account receivable factoring over other traditional funding sources which usually require all the assets available to a company for collateral on a credit line. Factoring is a Receivables-based credit line that needs no other collateral.

The main highlight of {a rel="nofollow" href= http://www.magfinancial.com/factoring.cfm}invoice factoring is that you can have cash on demand to meet seasonal demands or accommodate new and larger clients who may demand longer terms or use up any excess working capital you have on hand. In short, factoring invoices gives you the option of offering terms to your customers, thus helping you increase your customer base.

If you are looking for a company that can help you with invoice factoring or that can provide you with more information on {a rel="nofollow" href= http://www.magfinancial.com/factoring.cfm}receivables factoring, account receivable factoring and factoring invoices please visit {a rel="nofollow" href= http://www.magfinancial.com/}www.magfinancial.com.

Invoive Factoring Company: factor receivables, account receivables

2008-05-19T02:42:00.000-07:00

If you are new to the business arena and are wondering what factoring invoices entails, then you have come to the right place. Factoring invoices, also known as invoice discounting, receivables factoring and debtor financing, is crucial for a business. That is why experts advise that if you are going to be involved in invoice factoring, it is important to select the best invoice factoring company available. But what is factoring invoices and why is it used?

Factoring invoices is when one company purchases a debt or invoice from another company. It involves the purchasing of accounts receivables, which are further discounted in order to allow the buyer to make a profit upon collection of monies owed. In other words, factoring invoices transfers ownership of such accounts to another party that then works vigorously to collect the debt. A company involved in such activities is known as an invoice factoring company.

Invoice factoring is simple and alleviates the liable party of the debt for less than the full amount. According to several financial experts, these factoring invoices are more beneficial to the factor, or new owner, and the seller of the account than to the debtor. In invoice factoring, the seller receives working capital, while the buyer is able to make a profit by buying the account for considerably less than what it is worth and then collecting on it. It is consequently most profitable to find the best invoice factoring company.

This is when Magnolia comes into frame. Magnolia is the leading invoice factoring company , offering invoice factoring and also the latest information on it. In short, we are the one stop shop for all your factoring invoice needs. It has also been shown that in factoring invoices the seller receives working capital, whereas the buyer is able to make a profit by buying the account for significantly less than what it is worth and then collecting on it.

In other words, factoring invoices allows a buyer to acquire such accounts for about 25% less than their real value. The factor is fully responsible for collecting the debt. A factoring invoice company helps you in this process as it provides tips for companies and people involved in factoring invoices. Magnolia is a company that has excelled in this field and emerged as a leading factoring invoice company.

If you are looking for a factoring invoice company and don't know which to choose, then Magnolia is there for you. For more information on invoice factoring companies, receivables factoring, factoring invoices and account receivable please visit www.magfinancial.com.

Invoice Factoring: An Effective Alternative for Small Businesses

2008-05-17T00:00:00.000-07:00

?Cash is the king? is an undebatable truth. The vital importance of cash to the growth and day-to-day management of modern small businesses is very much evident. Even though profit, turnover and market shares are indicators of success, there is no replacement for cash. If there is no cash in the bank to meet monthly bills, wage runs and loan payments then any business can succumb to the crunch. Cash flow is generally acknowledged as the only pressing concern of the small and medium sized business enterprises. Small businesses typically enter into factoring arrangements to solve cash flow problems.

The lack of access to capital has prevented many small businesses from growing and capitalizing on the many opportunities that are available to them. Small companies do have to forgo large deals or opportunities because they do not have the necessary capital to obtain the resources to service the account. Inadequate capital resources along with the necessity to offer commercial credit to clients, often makes business owners victims of their own ventures. Factoring is a relatively unknown financial solution that has become available for smaller companies in such crisis situations.

Factoring, by definition, is the purchase of accounts receivable without recourse. Factoring is one of the oldest forms of commercial finance. The term factor comes from the Latin verb ?facio?, which means ?he who does things.? The history of factoring is the history of agents doing things for others. The colonists started widespread usage of factoring in the 1600s in Northern America.

Factoring accounts receivable is a form of short-term borrowing. Typically, the small business owner transfers all or a portion of your accounts receivable to a bank or other lender known as a factor. This factor immediately gives him a percentage of the accounts receivable. The percentage the lender is willing to advance is known as the discount rate that is typically 60 to 80 percent. This money allows the business owner to fund current business operations and generate new accounts receivable. The factor, usually takes responsibility for collecting all the accounts receivable.

Accounts receivable factoring is the sale of part or all of a debt that someone owes to the company. When companies provide financing through accounts receivable factoring, they essentially pay for the invoices as soon as the business owner generates them at a small discount of the invoice amount. They also provide accounts receivable management services by collecting the debt directly, monitoring credit of your clients and providing aging reports. Factoring allows a company to obtain financing without selling part of the company. It should be viewed as a bridge to growing a company, an interim step to obtaining a traditional credit facility or an equity capital.

Factoring is prefect for companies that are fast growing or those that seek to seize market opportunities. By using factoring, the entrepreneur can meet increasing sales demands. Today, it is estimated that factoring is a ?$100-billion-a-year? industry in the United States. Accounts receivable factoring makes up about a third of all financing secured by American companies using accounts receivable and inventory as collateral. Wholesalers, distributors, transportation, staffing companies, manufacturing and business services are some of the more common industries.

Christine is an expert Internet marketing professional with years of experience in various industries such as: Business, Finance, Real Estate, Web-Design, Health & Medicine and many more. Business Cash Advance

Factoring is Not Always About Cash Flow Problems, For Many It's About Growth

2008-05-16T02:43:00.000-07:00

Even though Factoring is an extremely common business practice in Europe, many American business people have never heard of it or used it. Factoring has been practiced for centuries; the Romans sold promissory notes at a discount and the Pilgrims journeys to America were financed by advances from a Factor who provided the funds to pay for the journey. The Pilgrims repaid the money with earnings from America. The word "factor" comes from Latin, the language of Rome. It means "to do" or "to make."

Even the United State Congress acknowledges and supports factoring with the passing of the Assignment of Claims Act, (31 U.S.C.3727) which states that ?Contractor or its assignee may assign its rights to receive payment due as a result of performance? to a financing institution. This is the assignment of invoices, know as factoring.

Factoring is the selling of your accounts receivables for cash versus waiting 30, 60 or 90 days, to be paid by your customers. Its a flexible financial tool that when used properly can help increase a companies growth without incurring new or additional debt.

Factoring is not always about cash flow problems, for many its about growth with a reliable foundation. Factoring has allowed thousands of small businesses to bid on and wind contracts worth millions of dollar in the Government and Corporate sector

Industries that use Factoring as a normal course of business are Temporary Employment Agencies, Distributors, Manufacturers, Government Contractors, Freight Companies (BOL) and Importers for the Purchase Order Funding. It does not matter if the business is a start-up, high-growth business, under-capitalized, or companies with cash flow problems. Most factoring companies do not even require financial statements; something like the ?no docs? real estate loans!

Factoring differs from the banks mainly because, a bank makes credit decisions based upon a company?s financial history, cash flow and collateral. Factoring bases its decision on the credit-worthiness of your clients. Because factoring is not a loan, no liability appears on your balance sheet.

Factoring can take as little as 48 hours and take up to 3 to 4 weeks for Government Contracts. The good part is, once you have your factoring in place, it takes only a couple of days, or less, to wire monies into your business account once the Factoring company has received your invoices.

Factoring companies do not leave your growth up to chance. They actively participate in screening new vendors for your company as well as collecting your invoices and handling accounts receivables that relate to them. And IRS subsidizes the cost of this because all cost involved with factoring is tax deductible.

Cassandra Ingraham is a Tax Accountant in the San Francisco Bay Area. She can be found at http://www.taxeswilltravel.com providing Formal Introductions to Lenders for Accounts Receivable Funding (Factoring) and Purchase Order Funding.

Funding Your Business With Factoring Financing

2008-05-15T04:41:00.000-07:00

Factoring financing is one of those business financing tools that is not well known by the general public but widely used in the business community. It is widely used, because it?s easy to implement, can be set up in a few days and can provide the working capital that a business owner need to grow their business.

When a business owner needs working capital, the first thing they do is to visit their banker. However, they soon learn that getting funding from a bank is very hard. As an owner, the bank will demand that they have great personal credit. The bank will also want to see three years worth of audited financial statements ? showing a profit.

If your business is new, it?s close to impossible to qualify for bank financing. However, factoring may be an alternative that is better for your business, and easier to get.

If you have clients that take 30, 45 or even 60 days to pay their invoices, and if this is hurting your business, invoice factoring can help. Factoring can provide you with a substantial advance on your invoices, providing the working capital you need to pay suppliers and employees. And, as opposed to conventional business loans, receivables factoring is easy to obtain.

Factoring is also easy to integrate to all businesses. This is how a transaction looks:

1. You deliver the goods or services

2. You invoice your client

3. The factoring company advances you up to 85% of your invoice as a 1st installment. You can use these funds to pay suppliers and employees

4. Once the invoice is paid for, you receive the remaining 15% less the factoring fees.

Most factoring fees range between 1.5% to 3.5% based on certain criteria, but different factoring companies assess their fees differently. The biggest criteria to qualify for factoring is that you should do business with customers that pay their invoices reliably, such as government agencies or large corporations.

One of the biggest advantages of factoring financing is that it is tied to your sales. So as your sales grow, your financing also grows. This makes it an ideal tool for companies that are expanding.

About Commercial Capital LLC
Looking for a factoring company? We can provide you with factoring and accounts receivable factoring at competitive rates. Please call (866) 730 1922

Receivables Factoring - An Exciting Alternative to Business Loans

2008-05-13T01:17:00.000-07:00

Do your clients take 30, 60 or even 90 days to pay their invoices? Extending payment terms, as it is commonly known, is very common in the business world. Customers demand that they be given credit, in the meantime you still have to pay for your company's ongoing expenses.

This can be a problem for companies of all sizes - from large established concerns to small startups. Unless you have enough cash to pay for business expenses - rent, salaries and suppliers - while you wait to get paid - your company is bound to run into problems. You may have to avoid taking large orders to conserve cash. Or worse, you may have to delay payments to employees or key suppliers.

Is the solution to get a business loan from the bank? Hardly. Banks only lend to companies that can provide detailed financials and show profitable operations for many years. If you get a loan, it will be for a fixed amount. If you need additional funds, you'll need to go through the process one more time. And worse, getting a business loan takes a very long time.

A better solution is accounts receivable factoring. Receivable factoring eliminates having to wait for customers to pay you - and provides you with the funds you need to meet business expenses. Furthermore, it's easier and quicker to obtain than a bank loan.

How does receivables factoring work? Simple. The factoring company gives you an advance on your accounts receivable. The advance ranges from 70% to 90% depending on industry and the types of clients you work with. This advance allows you to meet ongoing business expenses without having to wait for your clients to pay. The transaction is settled as soon as your client pays the open invoice.

Factoring receivables is also a cost effective solution. Factoring rates are usually determined based on the amount of financing you receive and on the payment reliability of your customers. The cost will be anywhere between 1.5% to 3.5% per month based on these criteria.

As opposed to other financing tools, factoring invoices is convenient and easy to obtain. Furthermore, it is usually more flexible than other financing tools since your financing line is based exclusively on your sales. That means, that your financing grows with your sales, making factoring a true tool for growth.

Commercial Capital LLC Looking for accounts receivable factoring? We can provide you with a factoring and invoice factoring at competitive prices. For more information, call (866) 730 1922

Accounts Receivable Factoring - An Exciting Alternative to Business Loans

2008-05-12T00:04:00.000-07:00

This can be a problem for companies of all sizes ? from large established concerns to small startups. Unless you have enough cash to pay for business expenses ? rent, salaries and suppliers ? while you wait to get paid - your company is bound to run into problems. You may have to avoid taking large orders to conserve cash. Or worse, you may have to delay payments to employees or key suppliers.

Is the solution to get a business loan from the bank? Hardly. Banks only lend to companies that can provide detailed financials and show profitable operations for many years. If you get a loan, it will be for a fixed amount. If you need additional funds, you?ll need to go through the process one more time. And worse, getting a business loan takes a very long time.

A better solution is accounts receivable factoring. Receivable factoring eliminates having to wait for customers to pay you ? and provides you with the funds you need to meet business expenses. Furthermore, it?s easier and quicker to obtain than a bank loan.

Commercial Capital LLC

Looking for accounts receivable factoring? We can provide you with a factoring and invoice factoring at competitive prices. For more information, call (866) 730 1922

Benefits of Factoring Receivables

2008-05-09T23:42:00.000-07:00

If you sell goods or services to commercial or government accounts you are very familiar with the fact that you have to offer your clients 30 to 60 days to pay their invoices. However, offering 30 day payment terms can be very challenging for business owners who must cover all the business?s expenses while they wait to get paid. This quickly eats up any cash reserves and puts the business in a challenging position. Unfortunately, when it comes to getting paid, hurry up and wait seems to be the name of the game.

But there is a solution to this problem that you won?t find at your local bank. It?s called accounts receivable factoring. It has the following benefits:

1. It gets your invoices paid in 24 hours, eliminating long payment waits

2. Factoring is easy to obtain

3. Setting up an account takes just a couple of days

Although factoring provides your business with working capital, it is not a business loan. It is an advance on your outstanding invoices. Because of this, factoring invoices is easy to obtain provided that you do business with reliable customers. Furthermore, invoice factoring easily integrates into your company. It works as follows:

1. You deliver the goods or services and invoice your client

2. You send the invoice to the factoring company, who advances you up to 85% of your invoice as a first installment

3. You get to use the funds to pay business expenses, while the factoring company waits to get paid by your client

4. Once the factoring company gets paid, it rebates the remaining 15% as a second installment, less a small service fee

Factoring service fees vary based on a number of variables, such as monthly factored volume and how long it takes for an invoice to get paid. Based on these, fees can range from 1.5% to 6%. Generally speaking, factoring is very affordable if your clients pay their in 45 days or less.

Factoring invoices is a great alternative for startups and established companies that have exhausted their bank resources. It?s a flexible product that is tied to your sales performance, this means that you will not get a fixed line. If your sales increase, so does your financing. This makes receivables factoring, an ideal product for growing companies.

About Commercial Capital LLC

Are you interested in working with a factoring company? We can provide you with accounts receivable factoring and receivable factoring at competitive rates. Please call (866) 730 1922 for more information.

Overcoming the Myths of Receivables Factoring

2008-05-09T02:36:00.000-07:00

Although factoring volume exceeded $112 billion in volume in 2005, which represented a 9.3% increase over the prior year, many decision makers tend to either employ other methods or choose not to go after additional financing to grow their business. If a company is either in a high-growth mode or is experiencing serious cash flow issues and is not able to establish a working line of credit with a bank, why wouldn?t they turn to factoring? There are three main concerns and objections that many decision makers have that can be overcome with educating the customer about the product.

Concern #1: Cost

The reality is that the cost of factoring is expensive compared to other types of financing (typically bank loans or lines of credit). If a company has the credit standing to get a bank line of credit that offers flexible terms, they should do so. If they have overextended their line or don?t qualify altogether and need additional capital to expand the business, the CFO should at least crunch the numbers to see if factoring is a viable option. There are some industries that experience low margins and slow payers. In general, factoring probably isn?t a good option for those types of companies. If, however, the margins are higher (over 12%), factoring may be a good way to take advantage of new sales opportunities and increase profits. Factoring fees can range anywhere from 2% to 4% per month depending upon several variables, including average dollar amount per invoice, credit standing of the debtors, and the average time it takes to collect the receivables. If a company enjoys the size of margin that can easily cover the factoring fees, it makes perfect sense to employ this type of financing, rather than forgo incremental profits and lose market share to a competitor.

Concern #2: Customer Perceptions

This is a concern with most prospects that are unfamiliar with factoring. The issue centers around notification and collection. At the inception of a factoring relationship, each account debtor is notified that a secured party (the factor) has taken title to invoices in which they owe payment. The letter also states that all present and future invoices due must be paid directly to the factoring company until otherwise notified by the factor. This is necessary to do this because if protects the factors collateral and to be protected by the UCC. Many business owners worry that they will be perceived in a negative light when the customers get these notices. There is no reason to worry. Factoring is hardly a new form of financing. Many industries (manufacturers, distributors, apparel & textile, trucking, and temporary staffing) rely on the services a factor provides. Factors only interact with customers on a random basis, mainly at the inception of the relationship.

Several large companies such as Walmart, Costco, and Target, have internal divisions within their accounts payable department to work with those vendors who factor their receivables. Should a customer who is unfamiliar with factoring question the notice and ask what is going on, the owner or manager only needs to tell them they have chosen to use a company to manage and finance their accounts receivable.

Concern #3: Losing Control over Receivables

Some people feel that allowing a factor to collect their receivables takes control away from them. A prospect should consider that a factor has provided an advance on a piece of paper and until they collect from the customers, they have nothing. However, it would be counterproductive for a factor to be overly aggressive in collecting receivables and risk alienating the customer base. Factors typically work hand in hand with the client to collect receivables and oftentimes allow the company to make collection calls. When payment is substantially late, the factor?s staff will likely make collection calls, but normally in a professional and courteous manner. A good factoring company will provide the client with comprehensive aging and performance reports, as well as credit screening for new customers. In effect, the client will not lose control of their receivables. They will actually be more on top of things because of the enhanced services the factor offers.

If more decision makers were educated about the benefits of receivables factoring, they would likely take a look at how it could help expand their business. Traditional lenders can?t always provide the solutions, so it makes sense to keep an open mind to alternative forms of financing.

Receivables Factoring - How To Finance Your Business Using Your Invoices as Collateral

2008-05-08T02:59:00.000-07:00

Obtaining business financing has always been challenging for small and mid size company owners. Traditional sources of financing, such as venture capital companies, angel investors or banks, provide financing that is hard to obtain and usually takes weeks - or months - to set up.

Angel investors and venture capitalists, although more generous than banks, only provide capital if you are willing to give them an ownership stake in your company. Usually a big one too. Banks don't demand an ownership stake. Instead, they will only lend you money if your company can show a three-year track record of profitability and if your personal credit record is spotless.

But, what if you don't want to give up ownership and if you don't meet banking requirements?

There is an option that is growing in popularity - and it provides you with easy to obtain financing. It's called accounts receivable factoring. Factoring is an ideal tool for companies whose biggest challenge is that they cannot afford to wait 30 to 60 days to get paid by customers. By factoring your receivables, you can get paid in as little as two days. This helps business owners to easily meet ongoing obligations such as payroll and rent, and allows them to grow the business. In effect it eliminates the uncertainty of when you'll be paid and allows you to streamline your cash flow.

Receivables factoring is very different than a business loan or line of credit. Rather than focusing on physical collateral (real estate, equipment, etc.) like banks do, factoring companies focus on your invoices. Are they from good credit worthy clients? Do they pay reliably on 30, 60 or 90 days? If they do, you have a good change of qualifying for invoice factoring.

Accounts receivable factoring is very easy to implement and works as follows:

1. Your company delivers the goods or services to the client

2. You invoice your client and send a copy of the invoice to the factoring company

3. The factoring company advances you between 70% and 90% of the invoice as the first installment

4. Once the invoice is actually paid, the factoring company advances you the remaining 10% to 30% as a second installment, less a small fee

Factoring financing is a great alternative to bank financing and venture capital that is easily available to small and medium sized businesses.

About Commercial Capital LLC We are a leading factoring company and can provide you with factoring financing and accounts receivable factoring financing. For a quote, please call (866) 730 1922

Invoice Factoring - How To Get Paid Promptly By Every Single Customer

2008-05-07T03:22:00.000-07:00

What happens if you are taken seriously ill while on holiday? Not just a bout of food poisoning, but in hospital, either as the result of an accident or a stroke.

When you are too ill to take a regular airline seat you will need to be brought home by air ambulance. Make sure that your vacation insurance covers this, because it will make a big hole in your bank account otherwise. Read the small print to see under exactly what circumstances an air ambulance will be provided by the insurance company.

If one of your party dies while abroad an air ambulance company can be hired to bring the body home for burial, even if it is not provided by your insurance company.

Long-range air ambulances are usually small business jet type aircraft. These business jets provide the fastest and most comfortable transport, where speed can be of the utmost importance.

Smaller fixed wing aircraft are used where the distance involved is smaller. They are faster than a helicopter and can sometimes be landed on a road near to an accident. Where poor weather would ground a helicopter, a twin or single engined, fixed wing air ambulance can still operate.

Rural parts of the United States, Europe and Australia depend on air ambulances to transport patients to hospitals in the shortest possible time.

In urban locations helicopter air ambulances are often most useful. They can dodge traffic and land on rooftops, sports grounds or roads, carrying EMT personnel to the scene of a traffic accident and rapidly taking injured patients to nearby hospitals.

Helicopters may be the only way that emergency personnel can reach a climbing or shooting accident in mountainous regions. They are small though, and only carry the minimum of supplies to enable the crew to stabilize a patient long enough to reach a nearby hospital.

Pearl Deloria has an SME management background. If you want more information on business factoring and how it can help your company then visit business factoring.

How and When to Use Invoice Factoring

2008-05-06T02:18:00.000-07:00

Do you have clients that take 30, 60 or even 90 days to pay their invoices? If you do, you are familiar with the strain that slow payments place on your company. Unless you have a reliable cushion of funds in the bank, paying suppliers and employees on time will be tough. And growing your business may be out of the question, at least temporarily, because growth requires cash.

Companies that have this predicament have a couple of options. They can get a bank loan or a line of credit. But those are tough to qualify for and very hard to obtain. A better alternative is to use invoice financing, better known as invoice factoring. As a tool, factoring invoices enables you to get paid in 2 days, rather than in 30, enabling you to operate and grow your business.

Factoring financing has many advantages over other products. First, factoring is relatively easy to obtain. Second, factoring financing lines are directly tied to your sales and have no arbitrary limits. That means that the more you sell, the more financing you can obtain.

When is it appropriate to use receivables factoring?

If any of the following two statements are true, then accounts receivable factoring should benefit your company.

1. You cannot afford to wait 30 to 60 days to get paid by customers. If your company's biggest problem is that you need your money sooner than the usual 30 to 60 days it takes for your clients to pay, then factoring is the ideal product for you. A factoring company can eliminate the wait and make your cash flow predictable.

2. You need money to pay suppliers or employees. Companies that need money to pay for ongoing expenses, such as employees or suppliers, can really benefit from invoice financing. Invoice financing will streamline cash flow and help you meet ongoing obligations. However, companies that need the funds to purchase equipment or to buy real estate will usually not benefit much from factoring. There are other products in the market that will be better.

Invoice financing is a great tool that can help make payments predictable. This allows you to plan for growth and enables you to capitalize on new and exciting growth opportunities.

About Commercial Capital LLC Looking for a factoring company? We can provide you with competitive factoring and invoice factoring quotes. Please call (866) 730 1922 for more information.

Financing Your Business by Factoring Invoices

2008-05-06T02:16:00.000-07:00

Waiting 30, 40 or even 60 days to get invoices paid can be a major challenge for any business owner. Although the work has been completed and delivered, the payment will come in weeks. In the meantime, the business has to pay employees, rent and regular expenses. If your business has a substantial cash reserve, this should not be a major problem.

But, what if your business doesn't have substantial cash reserve? Many owners will try to get a business loan. But that won't help. Why? Because getting a business loan is almost impossible unless the business owner has good credit and can prove three years worth of profitable business operations. Another option that is quickly gaining popularity involves factoring invoices.

Factoring financing allows you to eliminate the payment wait and gets your invoices paid in as little as two days. With invoice factoring you eliminate the uncertainty of when you'll be paid, which allows you to better manage and grow your business. Receivables factoring is easy to obtain and can be set up in days. Furthermore, if used properly accounts receivable factoring can work better that a business loan.

Here is how the factoring invoices works:

1. You deliver goods/services to your client

2. You sell the invoice to the factoring company

3. The factoring company pays you the 1st installment which can be as much as 90% of the invoice

4. Once your customer pays the invoice, the factoring company rebates you the 2nd installment, less the fees.

Since factoring companies buy your invoices, the biggest requirement to qualify for this type of financing is that you do business with customers that pay reliably. The cost of factoring will in large be determined by the volume of financing and the paying quality of customers. Generally speaking, the cost will range between 1.5% and 3.5% per month.

One big advantage of factoring over others types of financing is that there are no arbitrary limits or ceilings placed on your financing line. Whereas loans and lines of credit always have a "maximum", factoring has no maximums. Your factoring line will grow with your sales, provided you sell products to good paying clients.

So, if you are looking for a reliable way to finance your growing business, be sure to consider using a factoring service.

About Commercial Capital LLC Commercial Capital is a leading factoring company and provides factoring and invoice factoring. For more information call (866) 730 1922.

The Importance of B2B Business Factoring of Invoices

2008-05-03T03:36:00.000-07:00

Accounts receivables, when held back, holds up company capital. The sale of your invoices to a factoring company provides quick cash that is usable for your business right away. It is a struggle for small business owners to obtain cash at times and that is why it is important for B2B business factoring of invoices to a factoring company. The importance behind B2B business factoring of invoices becomes evident when a business is facing a financial crunch.

Many small business owners do not want to become bogged down with loans that yield a high interest rate. When the business needs ready cash for company survival or even to take advantage of an opportunity is when B2B factoring of invoices becomes a vital means of income to the business. Factoring out a company?s invoices does not require a business plan or tax statements. The cost behind doing this factoring is minimal for only a month or two; however, on a long term basis it can become more costly than a loan.

The idea of B2B business factoring of invoices may seem the solution you need for your circumstances. It would be advisable for you to consider some of the following facts:

? Do you really need the money for your company?s survival?

? Are you taking advantage of an opportunity that will enhance your business?

? Have you checked to see if this type of financing matches up with your business plan?

? At this time do you feel your business is ready for expansion and more money?

? Is this Accounts Receivables factoring your only way out or have you tried a small business loan?

? Finally, what are the current economic and industry conditions? Is now the time to finance or should you wait?

B2B business factoring of invoices plunge can mean the difference between company survival and bankruptcy. As a business person we understand that obtaining cash is one of the most vital means of keeping the business alive and doing well. Remember that this process is not regulated as the banking industry. We should investigate such things as the company we are going to work with. Make sure that you negotiate the rates, and inspect contracts. After you have done your homework and feel your ready then go with confidence.

The latest method in converting your invoices into fast cash is referred to as Inzap. We wanted to mention this procedure as it is a form of B2B business factoring of your invoices. Inzap has some good advantages that you might want to use. The fact is you can convert your invoices into fast cash for about 2% which is the best rate around. It only takes a few days to get your money but Inzap offers a more attractive payment terms to business customers.

This is a new approach to B2B business factoring of invoices. You do have many advantages over the traditional factoring services. I would like to mention some of these advantages for you to consider.

? The rates are lower about 2% of the invoice amount.

? The cash is available in just a few days.

? There are no minimum requirements you can use Inzap as little or as much as you like.

? You receive 100% of the cash upfront minus the fee charge.

? It takes about 5 minutes to sign up and they accept small business owners as well as the larger ones.

? You control your customer relationships while your customers enjoy getting more attractive payment terms.

Many business owners wonder why Inzap can offer such good services and low prices over the traditional method of factoring invoices. The importance of B2B business factoring of your invoices is always noted as essential to business. That is one of the main reasons that you should always investigate any business that you plan on doing factoring of your receivables with. Inzap has two good reasons that are beneficial to them which help them to keep good rates for the service they provide. The following two primary reasons may affect your business but you are the one who needs to consider if it will or not.

? One of the main things that Inzap does not do is insure you against non-payment by your customers.

? Cash flow is sped up but if your customer doesn?t pay for any reason then Inzap makes you responsible to pay them back. When you use this service I would advise that you use customer accounts that you can depend on.

? Inzap may start you out with a low credit line and build you up over time.

The B2B business of factoring invoices is indeed a method worth considering as a means of getting fast cash without the hassles.

This article has been supplied courtesy of Bill Darken. Bill often writes and works closely with Small Business Answers who can help with more information on B2B Business Factoring. This site is dedicated to supplying the latest news and articles on small business factoring to assist people progressing and with information and news. You can also look for small business information at small business answers. Small Business Lons are accessed at, http://loans-only.com/

Invoice Factoring: Turn Your Unpaid Invoices Into Cash Within 24 Hours

2008-05-01T02:33:00.000-07:00

Do you own or run an expanding business? Are you looking for capital to realise your potential or ease pressure on cashflow?

The biggest asset of most businesses is outstanding invoices. But they are virtually useless until you receive payment for them. Using an invoice factoring service you can start using the cash nearly as soon as the invoice is raised.

Like many UK businesses you could find that Invoice Factoring offers a real alternative to traditional bank finance.

How does invoice factoring work?

Invoice Factoring is a fast and flexible way to release money from your sales ledger which would normally take 1-3 months to be paid.

When a sales invoice is issued a copy is sent to the finance provider. The finance provider pays the business up to 90% of the invoice value with 24 or 48 hours depending upon the facility. The remaining balance is paid to the business, less the finance charges, once the debt has been collected.

The management of your sales ledger is transferred to the invoice factoring provider who will contact your customers for payment and chase unpaid invoices in line with your existing systems. This can be a huge benefit for smaller businesses who have fewer resources and need to spend more time running the business and generating revenue.

Is your business suitable for invoice factoring?

Factoring is only suitable for businesses that offer goods or services on credit terms. By advancing up to 90% against invoices, factoring can bridge the gap between issuing an invoice and getting it paid. Such as facility can be a massive benefit to an expanding business by ensuring reliable working capital and predictable cashflow.

How can your business benefit?

Factoring can benefit a business in many ways, one of which is as a source of finance to aid expansion by releasing working capital tied-up in trade debtors. As well as providing cash in advance of customer payment it can also ensure that invoices are paid faster further improving cashflow.

Another major benefit is the reduction in sales ledger administration costs allowing key staff to drive the development and profitability of the business.

As factoring becomes more widespread, it is proving a refreshing alternative to traditional bank overdrafts without the need for lending reviews as borrowing limits are met or exceeded. Instead, funding is expressed as a percentage of outstanding invoices so additional finance is automatically made available as more invoices are raised.

Used correctly, Invoice Factoring can be a real asset to your business helping it to grow and prosper with minimal fuss or interference from finance companies.

Permission is granted to publish this article on your website provided that the entire article and this copyright statement remain unchanged with live links.

The Growing Factoring Factor

2008-05-01T02:30:00.000-07:00

"We have plenty of business, but what we really need is cash to run our business!"

Have you ever heard a frustrated business owner utter this remark? Or thought it yourself?

What would you say if I told you I could help you or that other frustrated business owner get that cash to keep that cash flowing in your business -- keep your business up and going and running smoothly so that you can do what you do best -- run your business?

Okay.... got your attention?

Well, let me introduce you to a fast-growing source of cash for growth-oriented and cash-hungry small businesses -- factoring of accounts receivable.

"So, what exactly IS factoring of accounts receivable?" you ask.

Factoring is the conversion of a company's commercial accounts receivable into immediate cash by selling those accounts at a discount. With factoring you can get 70 to 80% of an invoice's face value wire transferred into your account within 24 to 48 hours of the invoice being issued and approved.

Better yet - factoring is not a loan! With factoring there is no interest to pay, nor principal to repay. No liability will appear on a company's balance sheet due to its factoring. A company simply sells one of its assets (accounts receivable) for an agreed-upon "fee" to obtain a more liquid asset (cash) thus self-financing it's own growth with debt-free funding. It's equivalent to when you sell your vehicle (an asset) to someone -- the two of you agree upon a price and the transaction is done!

Since factoring is not a "loan," funding is not based on a company's ability to repay the amount advanced. Rather, funding is based on the ability of the company's customers to pay what is owed the company for the purchase of the company's goods or services.

Unlike traditional funding sources, which require all the assets a business has available for collateral on a credit line, factoring is, in essence, a Receivables-Based Credit Line, which needs no other collateral. It is available to be drawn on when and as needed. In fact, a business can conceivably have a credit line with its bank with its other assets as collateral and a second credit line with a factoring company with the receivables ONLY as collateral! Interesting...?

With factoring, you can have cash on demand to meet seasonal demands, accommodate new and larger clients who may demand longer terms or use up any excess working capital you have on hand. Factoring, in essence, gives you the option of offering terms to your customers thereby helping you to increase your customer base.

Prior to the 1980's, factoring was used primarily in the garment, textile and furniture industries and was only otherwise available to "big business". At that time (as with many things), the terms and prices were much different than what they are today.

Due to the increased competition and visibility of this very viable financial tool, however, these have changed for the better. The terms and prices we see today make factoring a quick and viable alternative funding tool for small businesses nationwide so that they, too, can take advantage of this proven, debt-free and flexible method to effectively multiply working capital.

SOME HIGHLIGHTS/ADVANTAGES TO FACTORING:

1. No financials required -- MUCH less paperwork than traditional sources (oftentimes this can be done by fax or email and no personal "appearance" is required by the business owner)

2. Quick account setup - usually 5 business days (sometimes faster)

3. Usually can have 70 to 80% of invoice amount wire transferred to your account within 48 hours after approved.

4. No long-term contracts, you factor as much or little as needed.

Why don't YOU make this a year of growth and increased profits by using this financial tool to enhance your business!

Debra assists businesses with cash flow and working capital needs through non-traditional alternative funding tools, which help a business to leverage its liquid assets. This enables them to self-finance their growth and working capital needs. http://www.YourCashFlowConnections.com

Factoring: Unlock The Money You've Already Earned

2008-04-11T00:19:00.001-07:00

If you run your own business there?s no reason to wait thirty days or more to get paid - you can now have the money paid within 24 hours.

When you run a small business which depends on your customers making timely payments, you may find certain times of the year to be hard going. Even with your business being a really solid going concern, at times you may not be able to find the necessary cash for running your operations.

This can lead to some vicious cycles: your suppliers are discontent with your payment delays, so you may lose out on some good deals. Your employees get frustrated if they don?t receive their wages on time, and this can lead to a loss in productivity and higher staff turnover rate. So when you do finally get paid and you want to pick up activity again, you may have no one to supply you and no one to get the work done!

You need cash up front. What are the alternatives?

There are a number of ways for you to get more cash into your business:

* Inject personal funds. This is not usually an ideal solution.
* Find a new investor, if you are prepared to give away equity in your business
* Use an overdraft. A solution that usually implies a great deal of time and a lot of conditions your business has to comply with. Overdrafts can be recalled at any time and can be restrictive on your business.
* Apply for a bank loan. In this case you may be spending a lot of time only to find out that you are not eligible. Small businesses aren't usually banks' favorites when it comes to loaning them money.

The good news is that you don't actually have to wait. A good way to avoid these cash flow gaps and not enter the vicious cycle is to set up an agreement with a factoring company.

How to use your own money?

If you?re thinking that the money you've honestly earned is all locked up in outstanding or aging invoices, think again. A factoring facility can really work for you and help you to unlock the cash in your business.

Your invoices can be as good as any other assets from a factoring company?s point of view. Through factoring you can capitalise on your largest asset, your sales ledger today as opposed to waiting for payment from your customers.

How do you put an invoice through a factoring company?

The process is simple. When you invoice a customer you also send an electronic copy of that invoice to your factor. Then, within 24 hours or less, the factor advances you up to 90% of the invoice value. The factor usually takes on the responsibility of collecting the money from your customer the day the invoice is due to be paid. After that step is accomplished, the factor pays you the rest of the money, minus a small fee for the service.

For small to medium companies outsourcing the sales ledger management function can be of great benefit because it saves you the burden of managing invoices and undertaking the collections activity. By contracting out that element, you can effectively distance yourself from that function and concentrate on the relationship with your customers and focus on sales.

An additional service offered by such companies is protection against bad debts, which would typically cover up to 90% of the outstanding balance on any customer, where you have a designated protection limit in place.

Why should you use factoring?

Factoring is a complementary solution to be used alongside your standard banking facilities. You should look for the right factoring solution for your business.

Here are a few reasons why factoring should be another source of cash to consider:

* Because you'll never run out of cash again as a consequence of extending the payment terms to your customers.
* Because the facility will grow in line with your business growth
* Because the facility will allow you to take up opportunities available to you. to propel your business forward
* Because you can grow your business at the right pace without worrying about how long it takes your customers to pay you.
* Because you want the competitive edge against your competition.

Factoring is a financial tool that will allow you to obtain cash advances by capitalising your invoices, while at the same time easing your workload.

By Freelance writer sponsored by http://www.Ltsbcf.co.uk/ . LloydsTSB Commercial Finance provides business solutions such as term loans & factoring: http://www.Ltsbcf.co.uk/factoring/ . Please link to this site when using this article.

FACTORING: What's In It for You?

2008-04-11T00:18:00.001-07:00

Factoring or Accounts Receivable Financing is a tool for providing working capital and cash flow to businesses of all sizes and in all industries. It is especially useful for startups and for small, minority, women-owned and / or disadvantaged companies. There are many reasons why Factoring should be considered. Below I have highlighted some of the benefits.

QUALIFYING: If you're a start up or already have significant debt, you can still qualify for this financing. Funding is based on the financial strength of your customers. SPEED: the initial application process is fast, usually within a week. Then, as you generate and submit your invoices, CA$H is deposited into your bank account in 24 to 48 hours. PREDICTABLE: You have access to a steady, predictable cash flow. Invoices can be submitted daily. CONTROL: No longer do your customers determine your cash flow. No longer are you held hostage to the whims of your customers. And you are freed of credit term abuses. UNLIMITED: Virtually unlimited funds are available. We try to match you up with a factor / funding source that can handle current and future growth. But, in the unlikely event that you do exceed the capabilities of the funding company, Noble Finance$ will assist in converting your account so that you have uninterrupted cash flow. COST SAVINGS: Factoring clients have the ability to take advantage of early payment discounts from their suppliers. Additional savings are made when you can take advantage of volume discounts. These savings can significantly offset the factoring expenses. GOODWILL: Paying suppliers on time improves vendor relations and fosters good will. Suppliers are incented to provide better and more timely goods and services. This is a win-win situation. Vendors are better able to survive and support your expansion and growth. GROWTH: Factoring provides the working capital you need to fund business fund growth in general and to fund new lines of products or services, in particular. DIFFERENTIATION: Without concerns about cash flow, you can attract more business by offering better terms on your invoices. Most companies negotiate on price to win business in a competitive market. Factoring allows you to negotiate with terms instead of, or in addition to price. SCALABLE: Your funding grows as your business grows. No need to re-apply for a new or increased loan or line of credit. PEACE OF MIND: Get freedom from worry about how to meet payroll and pay tax obligations. You'll have sufficient working capital to eliminate these concerns. COLLECTIONS: The factor handles the collections. This frees up time spent on collections. Factoring clients generally have faster payments, since customers tend to pay financial entities faster than they pay other corporations. FLEXIBLE: No obligations, no minimums, and no maximums. You can control some of the factoring fees by waiting to submit invoices.

Noble Finances: Accelerating Cash Flow. Sandra Noble, CPIM, MBA, DCFS, CDP is president of Noble Finances, which is a division of Noble & Associates Consulting, Inc. Noble Finances helps companies Turn their Accounts Receivables into CA$H Now! See http://www.GetCashFromReceivables.com/

Loan Factoring

2008-04-11T00:16:00.000-07:00

Factoring of receivables is an arrangement whereby a company sells its accounts receivables to another company (banks and other institutions) that specializes in buying them and obtains the necessary financial accommodation. It is the most popular method of short-term financing in the US. Factoring offers the following advantages: relief to manufacturers and sellers from the bother of collection of book debts, saving in time and man-power required for debt collection, and last but not the least, adequate and better source of financing.

The factoring institutions render the following functions: Credit recording- that involves maintenance of debtor?s ledgers, collection schedules etc. Secondly, there is Credit administration that includes the collection of debts. Thirdly, there is credit financing, whereby the factor advances money against receivables. Finally, there is finance and business information wherein advices are given to customers on current trends and challenges.

Commercial paper is an important money market instrument, which is in the form of unsecured promissory notes issued by firms to raise short-term funds. Certain conditions are to be satisfied before the issue of commercial paper. Permission should also be obtained from the credit rating agencies. Commercial papers are issued for a period ranging from 3 months to 6 months. Commercial paper offers alternative source of raising short-term finance, helpful in times of tight bank credit and is a cheaper source of finance.

Term loans are those loans that are extended for a specific period ranging from 1 to 15 years. Medium term loans are extended for a period of 5 years and long-term loans are granted for a period of 15 years. Term loans are granted for establishment, renovation, expansion and modernization of industrial units as well as meeting the requirements of core working capital and for repayment of bonds and preference shares. Term loans are usually secured. They have either a fixed or a floating charge against the assets of the company. They are granted on the basis of a formal agreement, which contains the terms, and a condition of providing loans.

Factoring provides detailed information on factoring, credit card factoring, loan factoring, invoice factoring and more. Factoring is affliated with Invoice Factoring Discounting.

Accounts Receivable Factoring Companies

2008-03-30T23:28:00.001-07:00

As an owner of a company, you may have felt frustrated because your cash is tied up in fixed inventories and so you don?t have enough cash flow to energize your business. And keeping track of the invoices and the slow payments may distract you from the more pressing needs of your business.

You approach a bank for a loan, but don??bf?t get it. Then, in this scenario, the best option for you is to approach an Accounts Receivable Factoring or Financing Company. An Accounts Receivable Factoring Company will purchase your Accounts Receivable, such as invoices, at a discounted rate. This means that it will purchase them for less than the face value of the invoices. The seller company gets the cash, and the responsibility of collecting the money due becomes that of the Factoring Company. The Factoring Company collects the cash at the face value of the invoices, and thereby makes profits.

Apart from the Accounts Receivable Factoring Companies, there are also the Accounts Receivable Financing Companies, which function a bit differently from the Accounts Receivable Factoring Companies.

These Financing Companies offer loans by taking the invoices as collateral. This means that they don??bf?t really purchase the invoices. They just issue loans against them. This also means that the responsibility of cash collection lies with the business company, not with the Financing Company.

Both Accounts Receivable Factoring Companies and Financing Companies charge additional fees for their services. But the fees involved with the Factoring Companies are more than those from Financing Companies. This is because the responsibility of cash collection is also with the Factoring Company.

Accounts Receivable Factoring provides detailed information on accounts receivable factoring, accounts receivable collection, accounts receivable factoring companies, accounts receivable financing and more. Accounts Receivable Factoring is affliated with Accounts Receivable Collection

Accounts Receivable Factoring

2008-03-30T23:27:00.001-07:00

Accounts Receivable Financing and Accounts Receivable Factoring are two terms that are intermittently used, but there is a major difference between them. Although both refer to the concept of extending cash to an owner of a business in lieu of invoices and other Accounts Receivable, there are differences between the two, no matter how subtle.

First of all, Accounts Receivable Financing is a loan in which the invoices are used as collateral. But this not the case with Accounts Receivable Factoring. Accounts Receivable Factoring is not a loan. It involves the selling of the invoices to the Financing company at a rate less than the face value of the invoices. The Financing companies then collect the money at the full face value from the clients. This means the business house no longer has the responsibility of collecting the money.

But this is not the case in Accounts Receivable Financing. The process of Financing involves the extension of an advance on the percentage of each invoice??bf?s amount. Also, the responsibility of collecting the money remains with the business house.

Both Accounts Receivable Funding and Financing companies charge additional fees for services rendered, but in case of Accounts Receivable Factoring, the fees charged are comparatively higher. This is mainly because the entire responsibility of collecting the money is with the Financing company.

Companies providing Accounts Receivable Financing step in and work with companies who cannot get loans otherwise. Accounts Receivable Factoring, on the other hand, proves useful to business houses urgently in need of ready cash flow.

That said, both Accounts Receivable Factoring and Financing prove extremely convenient to companies who urgently require a cash flow to keep their business going.

Accounts Receivable Factoring provides detailed information on accounts receivable factoring, accounts receivable collection, accounts receivable factoring companies, accounts receivable financing and more. Accounts Receivable Factoring is affliated with Accounts Receivable Collection

Factoring And Invoice Finance Demystified

2008-03-28T23:02:00.000-07:00

When faced with a factoring service contract for the first time, you may find it complicated. In fact the concept of invoice finance is quite simple.

Factoring is a financial facility that allows your company to get paid on the invoices almost as soon as they have been issued. The facility effectively allows small or medium sized companies to turn your invoices, to include slow paying invoices into cash. Also known as accounts receivable financing, this is merely a way of helping small businesses capitalise on their future income today. It is a very easy way of improving the cash flow of your company and bridging the cash flow gap created when selling to another business on credit terms.

Factoring is similar to invoice discounting. The key difference is that with factoring, the financier runs the ledger, whilst with invoice discounting there is no credit control element to the facility. The business simply becomes the agent foe collecting in the funds on behalf of the financier. Invoice discounting can be disclosed to the customers or confidential, enabling you to go about your day to day activity without any implications as par as your customer?s perception goes and without any impact on the good relationships you have built.

What exactly can factoring do for your business?

Most businesses trade on credit terms, so when services and or products are delivered and the relevant invoice raised, there is a period of time (usually 30-90 days) before payment is received from your customer. There are a few solutions to assist you in trading and growing your business.

A Bank loan or overdraft is not the ideal way of financing a growing business. Overdrafts can be recalled at anytime and are not often granted at the right level to aloe you to optimize your business. In addition, often personal security is required.

The best cash flow solutions is invoice finance. The factoring/Invoice Discounting company will fund your invoices once the goods/services are delivered and the invoices raised. The rate your financier will advance against your invoices can be up to 90%. Invoices are typically financed for 120 days from the invoice date. Once your customer pays the outstanding balance, you will then receive the percentage you have not been paid against an invoice less your charges.

Charges can vary dependant on the type of facility and the level of service you opt for. The choice of the right solution for your business comes down to what your business?s specific requirements are. If it is particularly important to outsource the sales ledger management aspect of your business, then you may find it useful to opt for a factoring facility. This will free up some time and assist to reduce your debtor days.

An additional service offered by such companies is protection against bad debts, which would typically cover up to 90% of the outstanding balance on any customer, where you have a designated protection limit in place.

You?ve signed up with a factoring company. Now what?

When you invoice a customer, you send an electronic copy of that invoice to your factor.

The factor advances you the agreed percentage of that invoice. The factor is then responsible to collect the money from your customer. When the factoring company receives the amount due from the customer, it will pay you the rest of the money, minus the fees. Fees are usually broken down into two: Service fee, charged for running the ledger, collection activity and monitoring and a Discount Fee, which is charged over base rate, usually on a daily basis on the outstanding borrowed balance.

Who can benefit from using a factoring company?

Factoring is the best solution for any business that relies on a timely payment of outstanding invoices.

The most common indicators that you need a factoring facility are:

- When you are a new, cash flow dependant business.
- When your business doesn?t rely on a small number of major customers.
- When you need to finance the growth of your turnover
- When you foresee an increase in sales and you want to be able to take advantage of it.
- When you simply don?t want to get involved with anything other than what you do best, that is production and sales.

Now you have the basics. All that?s left for you to do is consider the benefits and decide if factoring or Invoice Discounting could be the solution to speed up the growth of your business.

By Iulia Pascanu sponsored by http://www.decision-finance.co.uk/ Decision Finance provides financial solutions such as term loans, stock & factoring: http://www.decision-finance.co.uk/ Please link to this site when using this article.

Invoice Factoring: Cash Now, No Waiting, NO Debt? Your competitor is doing it, Are you?

2008-03-27T22:50:00.001-07:00

What are Your costs for NOT Factoring?

Consider the time value of money and the benefits of improved cash flow to your business. By having, cash for your invoices within 24 hours are you able to pay your suppliers faster and receive better discounts. Are you able to fulfill your next order to XYZ Company and make payroll without tapping your line of credit at the bank? Can you offer longer terms to larger customers and attract more business? Can improved cash flow help your business grow or survive without incurring more debt at the bank? Can the financial benefits of improved cash flow to your business offset the fees of Factoring, and then some? Sure it can, the savings alone in taking discounts from your vendors can equal the cost of Factoring. All the other savings are in your pocket! Factoring is a smart business decision. Why are you doing it?

Is Cash needed immediately for growth or survival?

Is long billing cycles putting a strain on your business cash flow? Despite increasing sales, does the management of receivables and payables seem like a juggling act? Could your business increase sales by offering better terms to your new and larger customers? Are you spending too much time collecting from slow paying customers and not enough time building your business? Is your bank turning you down for traditional financing due to years in business, profitability, lack of assets, personal guarantees or financial strength?

Have you considered turning away new business due to slow cash flow?

These are challenges many businesses face that can be solved with Factoring.

Benefits of Factoring Receivables

Simplicity

The advanced funding you receive for your receivables and the discount fees you will pay are based solely on the financial strength and credit worthiness of your customers, not your business!

You receive Cash for your unpaid accounts receivable invoices. Usually the factoring company buys the invoice from you for an amount less than its actual face value (70-90%). When the Factor later collects the full amount of the invoice from your client, you will receive the remainder of the advance less the factoring fee (discount rate). Fees will vary depending on the total dollar amount you intend to factor on a monthly basis.

Flexibility

Need a flexible financial solution that can help your business be more competitive while improving your cash flow, credit rating, and supplier discounts? Factor as much as your want or as little as you want. You decide. No obligations. There are No minimums and No maximums in the amount you can factor. No binding contracts, if that is what you want.

Unlike traditional bank financing, factoring relies on the financial strength and credit worthiness of your customers, not you. Here?s why you should use Factoring services:

Offer Better Terms - Win More Business

With Factoring, you can attract more business by offering better terms on your invoices. Most companies negotiate on price to win business in a competitive market, but with Factoring, you can negotiate with terms instead of price.

To your customers, better terms can be more attractive than better prices.

When using attractive terms to win business, you can build the cost of factoring into your costs of good and services.

Example: A new customer may choose to do business with your company because you can offer NET 30 or NET 45 terms while your competitor (who isn't factoring) requires payment up front but has a 3% better price. If you factor the subsequent invoice at a discount of 3%, you have leveraged factoring services to win the business at no extra cost and improved your cash flow at the same time.

Improve Cash Flow * NO Additional Debt *WIN over customers

Your Business Receives:
* Get cash in 24 hours or less from your outstanding invoices! Eliminate long billing cycles.
* No new debt is created. Factoring is not a loan. This allows you to preserve your financial leverage to take on new debt. Improved credit rating.
* Purchase capital equipment to expand your business.
* Increase inventory for quicker shipments or handle seasonal inventory needs.
* Market for additional business.
* Take trade discounts. This alone can offset Factoring fees and all the other savings are gravy!
* Pay off nagging, expensive delinquent obligations.
* End payroll worries.
* Meet tax requirements on time. No more exhaustive penalty fees.
* Negotiate discount purchasing.
* Unlimited sales and profit potential.

You Receive:
*Cash stability
*Simple to start and use
*You keep control
* Reduce stress, improve planning, focus on what is critical to make money.
Customer Credit Services:
*Reduce bad debt expense, work with experts at collecting.
* Streamline credit approvals for new customers.
* Improve decision-making on new business.
* Reduce administration costs: long distance calls for collection and credit investigation, postage, staff, monthly statements and more.
* Larger customer credit lines and better terms, which increase sales.
* As you grow, your payroll budget for credit and collection department is minimal.
Accounts Receivable Management:
* Reduce administrative costs. Factor will post invoices and apply cash applications.
* Improve customer relationships. You are no longer the bad guy looking for payment.
* Improve receivable turns. Fact: Customers pay Factors before independent businesses.
* Improve accounting performance; timely reports, online access and more.
* Redirect your critical resources to marketing and production

If you are looking to receive an increase in cash flow and increase your bottom line profits, you need to factor your invoices now!

Please feel free to reprint this article as long as it is left intact and all links are hyperlinked.

www.brtfinancial.com/arecfac.htm

BRT Financial specializes in Invoice Factoring; it gets you the cash you need now! Factor as many invoices as you need! Invoice Factoring will provide the cash flow you need to increase your bottom line profits! www.brtfinancial.com/arecfac.htm www.brtfinancial.com

Increase Cash Flow With Invoice Factoring

2008-03-27T22:49:00.001-07:00

Invoice factoring is one of the quickest, easiest ways for business owners to increase their cash flow. If your business produces invoices, then invoice factoring is an option for you.

The process of invoice factoring works in just a few simple steps. When an invoice is created, you sell it to the ?factor? at a discounted rate ? usually about 3 to 5 percent off of the invoice total. Factoring means you do not have to wait for the customer to pay to start collecting money from the invoice.

First you, the business owner, notify the factor that the invoice has been created. Usually this can be done electronically. You provide the customer?s contact information to the factor, and the factor will confirm the invoice with your customer.

Typically, invoices are confirmed with a simple letter or phone call. Usually the factor appears to your customer to be a billing processor or department, confirming the invoice on your behalf. This way, the customer does not realize you have sold your invoice to a third party.

Some invoice factoring companies are willing to remain completely invisible to your customers. And after you have established a relationship with your factor, and they are more familiar with your business and your customer base, they will likely stop confirming every single invoice.

After the invoice has been confirmed, the factor pays your business what is known as the ?advance rate.? This is a percentage of the invoice total, typically around 70 to 85 percent.

The factor then collects the total amount of the invoice from your customer. They keep their 3 to 5 percent, and forward the rest of the total to you.

Invoices factoring increases your business? working capitol and helps improve the credit rating of your business. And, when factoring your invoices, you are in control. You decide which invoices to factor and which ones to collect yourself, based on your relationship with your customer base.

Have you just recently started up your business? Are you finding it difficult to build enough working capitol to run your business day to day? Invoice factoring can work as a bridge to get you over the rough waters after start-up until your business is able to run smoothly.

And, if your business has poor or no credit history, invoice factoring is an option to consider if loans or liens won?t work for you, or if you consider them too risky.

A steady, reliable cash flow is necessary for any business to operate smoothly. Worrying about your cash flow also causes business owners more stress than almost any other aspect of their business. Invoice factoring allows you to stop worrying. It is the simple, fast way to increase cash flow now.

Robert Michael is a writer for MZ Factoring which is an excellent place to find factoring links, resources and articles. For more information go to: http://www.mzfactoring.com"

Invoice Factoring: Cash Now, No Waiting, NO Debt... Your competitor is doing it, Are you?

2008-03-27T00:12:00.001-07:00

What are Your costs for NOT Factoring?

Consider the time value of money and the benefits of improved cash flow to your business. By having, cash for your invoices within 24 hours are you able to pay your suppliers faster and receive better discounts. Are you able to fulfill your next order to XYZ Company and make payroll without tapping your line of credit at the bank? Can you offer longer terms to larger customers and attract more business? Can improved cash flow help your business grow or survive without incurring more debt at the bank? Can the financial benefits of improved cash flow to your business offset the fees of Factoring, and then some? Sure it can, the savings alone in taking discounts from your vendors can equal the cost of Factoring. All the other savings are in your pocket! Factoring is a smart business decision. Why are you doing it?

Is Cash needed immediately for growth or survival?

Is long billing cycles putting a strain on your business cash flow? Despite increasing sales, does the management of receivables and payables seem like a juggling act? Could your business increase sales by offering better terms to your new and larger customers? Are you spending too much time collecting from slow paying customers and not enough time building your business? Is your bank turning you down for traditional financing due to years in business, profitability, lack of assets, personal guarantees or financial strength?

Have you considered turning away new business due to slow cash flow?

These are challenges many businesses face that can be solved with Factoring.

Benefits of Factoring Receivables

Simplicity

The advanced funding you receive for your receivables and the discount fees you will pay are based solely on the financial strength and credit worthiness of your customers, not your business!

You receive Cash for your unpaid accounts receivable invoices. Usually the factoring company buys the invoice from you for an amount less than its actual face value (70-90%). When the Factor later collects the full amount of the invoice from your client, you will receive the remainder of the advance less the factoring fee (discount rate). Fees will vary depending on the total dollar amount you intend to factor on a monthly basis.

Flexibility

Need a flexible financial solution that can help your business be more competitive while improving your cash flow, credit rating, and supplier discounts? Factor as much as your want or as little as you want. You decide. No obligations. There are No minimums and No maximums in the amount you can factor. No binding contracts, if that is what you want.

Unlike traditional bank financing, factoring relies on the financial strength and credit worthiness of your customers, not you. Here's why you should use Factoring services:

Offer Better Terms - Win More Business

With Factoring, you can attract more business by offering better terms on your invoices. Most companies negotiate on price to win business in a competitive market, but with Factoring, you can negotiate with terms instead of price.

To your customers, better terms can be more attractive than better prices.

When using attractive terms to win business, you can build the cost of factoring into your costs of good and services.

Example: A new customer may choose to do business with your company because you can offer NET 30 or NET 45 terms while your competitor (who isn't factoring) requires payment up front but has a 3% better price. If you factor the subsequent invoice at a discount of 3%, you have leveraged factoring services to win the business at no extra cost and improved your cash flow at the same time.

Improve Cash Flow* NO Additional Debt *WIN over customers

Your Business Receives:

* Get cash in 24 hours or less from your outstanding invoices! Eliminate long billing cycles.

* No new debt is created. Factoring is not a loan. This allows you to preserve your financial leverage to take on new debt. Improved credit rating.

* Purchase capital equipment to expand your business.

* Increase inventory for quicker shipments or handle seasonal inventory needs.

* Market for additional business.

* Take trade discounts. This alone can offset Factoring fees and all the other savings are gravy!

* Pay off nagging, expensive delinquent obligations.

* End payroll worries.

* Meet tax requirements on time. No more exhaustive penalty fees.

* Negotiate discount purchasing.

* Unlimited sales and profit potential.

You Receive:

*Cash stability

*Simple to start and use

*You keep control

* Reduce stress, improve planning, focus on what is critical to make money.

Customer Credit Services:

*Reduce bad debt expense, work with experts at collecting.

* Streamline credit approvals for new customers.

* Improve decision-making on new business.

* Reduce administration costs: long distance calls for collection and credit investigation, postage, staff, monthly statements and more.

* Larger customer credit lines and better terms, which increase sales.

* As you grow, your payroll budget for credit and collection department is minimal.

Accounts Receivable Management:

* Reduce administrative costs. Factor will post invoices and apply cash applications.

* Improve customer relationships. You are no longer the bad guy looking for payment.

* Improve receivable turns. Fact: Customers pay Factors before independent businesses.

* Improve accounting performance; timely reports, online access and more.

* Redirect your critical resources to marketing and production

If you are looking to receive an increase in cash flow and increase your bottom line profits, you need to factor your invoices now!

Please feel free to reprint this article as long as it is left intact and all links are hyperlinked.

www.brtfinancial.com/arecfac.htm

BRT Financial specializes in Invoice Factoring; it gets you the cash you need now! Factor as many invoices as you need! Invoice Factoring will provide the cash flow you need to increase your bottom line profits!

www.brtfinancial.com/arecfac.htm

www.brtfinancial.comInvoice Factoring: Cash Now, No Waiting, NO Debt... Your competitor is doing it, Are you?

Invoice Factoring: A Tool To Revitalize Your Business

2008-03-24T23:50:00.001-07:00

Imagine a situation where your company is unable to strike a good deal owing to late payment to be made by its customers. You find yourself to be really missing out on "that big deal." But now, you don't really need to face the guilt of missing out such an opportunity. Thanks to the boom of factoring into the financial field! All that you need to do is approach a suitable factor and see yourself getting out of every dilemma.

Compared to loans and lines of credit, which require the clients to have tangible assets and strong financials, invoice factoring helps one to attain cash easily. Besides, most of the business enterprises today do not qualify for the criterion set by the traditional lending institutions. As such, invoice factoring offers them an excellent opportunity to gear up their business. Factoring allows them to avail immediate capital only at a nominal cost.

Invoice factoring is a blessing for business enterprises that are preparing to grow significantly because the factor takes up a part of the client's credit risk for the end customers. It involves the factor's bearing up of the loss in case the debtor fails to pay the invoice. This, therefore, is one of the critical services lent by factors to ambitious business enterprises.

One essential thing to know about factoring is that one doesn't need to owe anything to the factor. The factor does not advance loans but buys invoices from the client. Since invoice factoring is not a loan, it is easy to qualify for it. All you need is a well-run business along with good customers. These are the only two potential prerequisites needed to avail the benefit of factoring. Many factors, infact, do not even demand high credibility on part of the customers. This makes factoring even more alluring to small business enterprises.

Besides, one of the primary objectives of any enterprise is steady cash flow. If cash flow freezes all of a sudden, there arises an immediate need to convert the receivables into ready cash. Invoice factoring thus offers the unique prospect to regenerate a dying business as it provides certain ancillary services as well as frees up internal resources.

Suzanne is an Internet marketing professional with expertise in content development and technical writing in a variety of industries. Small Business Cash Advance

Growing your Business with Invoie Factoring

2008-03-23T23:27:00.000-07:00

Is cash a little bit tight? Have you ever risked missing payroll? Have you ever had to pass up an opportunity because you did not have enough money? If so, you are not alone. Every business owner goes through those same challenges every day. Some come out on top. Others perish.

What is the biggest difference between those that succeed and those that perish? Cash flow. And plenty of it.

If you work with commercial or government clients, then you are already used to waiting up to 60 days to get paid by your clients. That is ok if your business has lots of resources and a stash of cash in the bank. But what if you don't?

One of the most frustrating things that can happen to a business owner is realizing that his company is invoice rich and cash poor. Meaning, you have tons of money owed to you by clients (and payable in 60 days) but little cash to show for it. This does nothing for you, if you need to meet payroll in 3 days or need money to buy supplies for a new project. Fortunately, there is an easy way to turn those invoices into cash, without using any collections or heavy-handed tactics.

The solution involves factoring your invoices. Never heard of invoice factoring? You are not alone. Factoring is one of the most used and least talked about business financing tools. It allows you to convert your invoices into immediate cash. It helps you turn your invoice rich business into a cash rich business.

Qualifying for factoring is simple and only takes a few days. As opposed to business loans, you don't need a long business history or reams of financial statements to qualify. All you need are invoices for credit worthy commercial clients or government clients.

And how does factoring work? Well, it simpler than you think. As soon as you have completed a job, you submit an invoice to your client and send a copy to the factoring company. The factoring company will advance you a substantial portion of your invoice, usually within a day. Once your client pays the invoice, the transaction is settled.

As you can see, factoring provides you with immediate cash as soon as you invoice. This helps you meet payroll, pay suppliers and take on new jobs. With factoring, you can streamline your billing cycle and grow your company, without ever needing a business loan.

Commercial Capital LLC Looking for a factoring company? We can provide you with a factoring, invoice factoring or accounts receivable factoring quote? Please call Marco Terry at (866) 730 1922 for more information

What can a factoring company do for you?

2008-03-23T23:26:00.000-07:00

Are you selling goods or services to commercial customers or to the government? If so, you are probably used to the idea of having to wait up to 60 days to get your invoices paid. However, waiting to get paid can be challenging, especially if you have business expenses that can't wait. That is where a factoring company can help you.

Factoring companies can provide you with financing, based on your slow paying invoices. They eliminate the 60 day payment waiting period and provide you with the necessary liquidity to meet payroll, pay rent and meet business obligations. Here is how factoring works in a nutshell:

1. You invoice your customers and send a copy of the invoice to the factoring company 2. The factoring company advances you up to 90% of your invoices 3. You get immediate use of the funds. The factoring company waits to be paid 4. Once the factoring company is paid by the customer, the transaction is settled

Although many business owners will go to a factoring company to get financing, factoring companies also provide other important services. Most notably, factoring companies can act as your business credit department. They can review existing clients and new prospects and advise you of their payment habits. And since they manage your accounts receivable, factors can also provide you with important financial reports and financial analysis.

More importantly, a factoring company can help you grow your business. By turning your slow paying invoices into cash, they give you the financing and the flexibility to take on new opportunities. And, factoring financing lines don't have arbitrary limits like business loans. They grow in relation to your sales. The more you sell, the more financing you get.

Because of these benefits, factoring companies can be great business partners and help finance your business growth.

Commercial Capital LLC Need a factoring company? We can provide you with a factoring and invoice factoring quote. Call Marco Terry at (866) 730 1922 for more information

Receibales Factoring Financing - How to Self Finance Growth

2008-03-21T00:04:00.000-07:00

Do you own a company that is growing quickly? If your company were a car, do you feel like you are pressing on the accelerator while at the same time stepping on the brake? Or worse, that your growth is stuck in neutral?

Slow cash flow is the biggest challenge to company growth. And business owners, like you, know that the biggest cash flow problem is having to wait up to 90 days to get paid by your commercial and government customers.

Going to the bank for a business loan won't help much, unless your company has a great past history. This is because banks give business loans based on past performance. What you need is a financing product that can finance your company based on its future potential. And who better to evaluate your future potential than yourself? This is where receivables factoring can help you. This is because receivables factoring is self-financing.

Receivables factoring, also known as invoice factoring, works by eliminating the 30 to 60 days it takes for commercial clients to pay you. It enables you to get a substantial portion of the money owed to you within a day or two of invoicing, providing you with funds to pay rent, meet payroll and more importantly - expand your business.

Imagine if you could get paid consistently, just two days after invoicing. How fast could your business grow? And without debt. This is how receivables factoring works:

1. You invoice your customers as you always do
2. You send a copy of your invoice to the receivables factoring company for financing
3. The factoring company advances you up to 80% of your invoice (20% is not advanced to cover potential disputes, etc.)
4. You get your money right away. The factoring company waits to get paid by your customer
5. Once your customer pays, the factoring company rebates you the 20% reserve, less a small fee

Factoring can be a very cost effective way of financing your business. The factoring fee is based on three factors:

1. The credit quality of your customer, 2. Your monthly volume and, 3. How long it takes customers to pay your invoices.

As a rule of thumb, monthly costs can go from 1.5% to 6% per month depending on these criteria. If you own a company that has a lot of capital tied in slow paying receivables and if you need financing right away, you should consider factoring your invoices.

About Commercial Capital LLC We can provide you with a no obligation factoring, invoice factoring or receivables factoring quote. For more information, please call Marco Terry at (866) 730 1922

Can Accounts Receivable Factoring Help My Company?

2008-03-20T00:23:00.000-07:00

Are you stuck with great but slow paying clients? It is interesting how your biggest asset (great clients) can also be your biggest liability. But that is how business is. And as an owner you must adapt.

Whether you like it or not, slow paying customers are here to stay. As a rule of thumb, commercial clients pay their bills in 30 to 60 days. And lately, the trend has been deteriorating. So, what do you do if you have slow paying receivables.

Many owners try to go to the bank to get a business loan. Not surprisingly, few business owners get business loans. As a rule, banks will only finance companies that have long and established histories. This is not your case if your company is new or emerging from tough times.

If your biggest challenge is that you cannot afford to wait up to 60 days to get paid by your customers, then the solution is accounts receivable factoring. Most commonly known as factoring, this type of financing eliminates the usual wait to get paid. It provides you with the necessary funds to pay suppliers, meet payroll and take on new business opportunities.

And how does factoring work? Simple:

1. You finish the work and send an invoice to your client. You also send a copy to the accounts receivable factoring company. 2. The financing company advances you 70% to 90% of the invoice (a small reserve is held to handle disputes, etc.) 3. You get the funds in 24 hours 4. As soon the customer pays the invoice to the financing company, they rebate the reserve (less a small fee)

As you can see, accounts receivable factoring can easily be integrated into your business, providing you with prompt invoice payments. Usually, funds are advanced within 24 hours of submitting invoices.

Accounts receivable factoring is easy to qualify for. Accounts can be set up in as little as 4 business days. As opposed to business loans, the main requirement for factoring is to do business with strong credit worthy customers. So if you do business with good commercial clients (or the government), be sure to add factoring to your business tool chest.

About Commercial Capital LLC We can provide you with factoring, invoice factoring and accounts receivable factoring. For a no obligation quote, call Marco Terry at (866) 730 1922

Invoice Factoring

2008-03-19T01:57:00.001-07:00

Factoring is selling invoices to receive your money at the moment, instead of waiting for say, two to three months. That's why it is one of the most important finance management tools - especially for a small company that does not create debt. Factoring does not require you to give up any ownership in your company.

For carrying out any operation, finance is required. So, necessary finance is to be raised, allocated and controlled for the effective execution of any function. Success or failure of the firm as such depends on how effectively the finance part is undertaken.

The finance function is comprised of the determining and raising of necessary funds from appropriate sources and their proper allocation and control. The aim is to attain the enterprise objective of wealth maximization. The wealth or the value of the firm is at the maximum when the return or profit is also at the maximum. But with the increase in return the risk also increases. For example, holding less inventory may increase profit because a lesser amount is locked up in inventory, but this may increase the risk as the chance of running out of inventory is higher.

According to experts, factoring process has some distinct advantages. For example, unlike a loan, collateral is not required in the factoring process, there is no interest, and no debt shows up on your balance sheet. What's more, fees are paid in the form of a percentage discount, deducted after all of the invoices have been paid to the Factor. The discount amount depends on the length of time it takes to collect on the invoices.

Always keep capital budgeting and working capital on mind while understanding the finance management. Capital budgeting is the evaluation and ranking of investment projects with the aim of finding out the most suitable project from among alternative courses. On the other hand, working capital is the amount of capital required for the day-to-day running of the enterprise.

Factoring provides detailed information on factoring, credit card factoring, loan factoring, invoice factoring and more. Factoring is affliated with Invoice Factoring Discounting

Factoring Software

2008-03-19T01:56:00.000-07:00

Factoring software can be defined as an interacting, continuing, future-oriented structure of equipment and procedure, designed to generate and process information flow that can aid business executives in the management of their programs.

Factoring software involves broader and more inclusive activity then, say, research. It includes determining and specifying the data needed, the generation of this information by means of research then the processing of this data. While this is a system concept, research usually deals with fragmented, unrelated research projects, done to solve an existing problem identified by some executive.

Software is used on a continuing basis, serving as both a prognosis and a diagnosis. It is preventive as well as curative medicine for factoring companies. Defining the information needs is the most important step in the development of factoring software. The efficacy of the system as a whole depends on this basic step. When clarity is lacking with regard to information needs, the software as a whole gets misdirected and handicapped. Good software recognizes that different executive levels in the company require different types/ segments of information and it ensures that information needs of various executive positions in the company are defined by the concerned executive themselves.

Good software should fulfill the following requirements. It must be unified. It must be conceived and used as a decision support system. It must be compatible with the company and with the overall level of sophistication of the firm. It must be user oriented and it must secure the involvement of users. It must also involve and motivate the suppliers of the information. It must be economical. The cost value ratio of the information processed by the software should be favorable to the firm. It must be capable of absorbing smoothly any changes that may become necessary in the system.

Factoring provides detailed information on factoring, credit card factoring, loan factoring, invoice factoring and more. Factoring is affliated with Invoice Factoring Discounting

Factoring Services

2008-03-18T01:19:00.001-07:00

Factoring services means managing the financial operations of an organization to achieve the objective of the enterprise. The basic financial operations are investment, which deals with acquisition of fixed assets; financing, which deals with the raising of required funds from various sources; and profit appropriation, which deals with appropriating the profit earned by the enterprise among the suppliers of funds.

Regarding investment, assets/projects are to be selected only by considering their net returns. Regarding financing it is to be ensured that the firm gets the required finance at the lowest possible cost. Similarly, regarding profit appropriation it is to be seen that sufficient fund is provided for the developmental activities of the enterprise without impairing the interest of the suppliers. In a firm where these operations are planned and controlled properly it can be said that there exists efficient factoring services.

All the operations and resources in a business organization are managed with the same broad objective, i.e., to attain the objective of the enterprise. So each resource or area should be managed in such a way to contribute to the fulfillment of the objective for each functional area. According to the objective of profit maximization the ultimate goal of a business enterprise is to maximize its profits. All the efforts of the organization are to be directed to achieve this goal.

Business is for earning profit. When profit earning is the aim of the business, profit maximization should be the obvious objective. Profitability is an indicator to the efficiency with which the firm is managed. The higher the profit, the better the efficiency. For growth and expansion, profit is the main source of finance. To meet unforeseen contingencies reserves are necessary which is possible only if there is enough profit. However the term profit is vague. It may assume different meanings in different contexts. It may be short-term vs. long-term, or profit to the equity shareholders vs. total profit. It may be profit before tax or profit after tax. It may be absolute profit or profit in relation to investment.

Factoring provides detailed information on factoring, credit card factoring, loan factoring, invoice factoring and more. Factoring is affliated with Invoice Factoring Discounting

Factoring Consultants

2008-03-18T01:18:00.001-07:00

The ultimate goal of factoring consultants is to maximize the wealth of the shareholders. This is represented by the market value of the shares of the factoring companies. Wealth is defined as the net present worth of the company, i.e., the present value of all future returns. This is determined by capitalizing the net income after taxes, which is achieved by discounting the return expected by the investors - also known as cost of equity.

Though the wealth maximization seems superior to profit maximization objective, it is to be noted that the former is based upon the latter. The market price of shares, which is the indicator of the wealth of the firm, is based on the long-term returns of the firm. The returns that accrue to the investor would be a function of the earnings of the company. In addition to serving the basic of objective of the firm, consultants has some specific objectives like, maximizing profit- both short-term and long-term profit, minimizing risk, maintain control, achieve flexibility, ensure liquidity and maintain financial discipline in the organization.

With the development of finance as a profession and as an important area of management, the role of consultants has undergone drastic changes in recent times. Presently, the consultants are in charge of determining the total amount of capital required (both working capital and fixed capital). This is done by proper forecasting and planning of finance. They also play a pivotal part in investing the funds in assets and projects with the aim of making profit. This is to be done in such a way that the earnings are more than the cost so that there is a positive net return to the concern.

To play his role well, the factoring consultant has different tools, such as cost of capital, which indicates the appropriate source of finance. Normally, the sources with minimum costs are selected so that the weighted average cost of capital can be kept at the minimum. Then there is leverage to decide the proportion between ownership funds and outside funds. Usually, outside financing is adopted to magnify the earnings on ownership funds, provided the outside financing is available at a lower cost and without much additional risk.

Factoring provides detailed information on factoring, credit card factoring, loan factoring, invoice factoring and more. Factoring is affliated with Invoice Factoring Discounting

Factoring Companies

2008-03-17T02:12:00.000-07:00

After the products have been selected and the systems for producing them have been designed and built, the next major step is to operate the system. This requires setting up a company structure, staffing the positions and training people. In factoring companies, managers are needed who can provide the supervision and leadership to carry out activities necessary to produce desired products or provide services. Other activities, such as purchasing and maintaining the inventory, are also required in maintaining the factoring companies. The aim is to obtain the best productivity ratio within a time period with due consideration to quality.

Controlling operations, as in any case of managerial control, requires setting performance criteria, measuring performance against them, and taking actions to correct undesirable deviations. Thus, one can control production, product quality and reliability levels, inventory levels and work force performance in factoring companies.

A number of tools and techniques have been developed to do this. With the development of computer hardware and software, it is now possible for virtually any measurable data to be reported as events occur. Systems are available for quickly and systematically collecting data bearing on total operation, for keeping these data readily available, and for reporting without delay the status of any of a large number of projects at any instant. They are thus primarily information systems playing a pivotal part in factoring companies to provide effective planning and control.

These and other systems that use the technology of fast computation clearly promise to hasten the day when planning all the areas of production can be more precise and controlling more effective. The drawback is not cost; rather it is the failure of managers to spend time and mental effort on conceptualizing the system and its relationships or to see that someone else in the company does so.

Factoring provides detailed information on factoring, credit card factoring, loan factoring, invoice factoring and more. Factoring is affliated with Invoice Factoring Discounting

Factoring

2008-03-17T02:11:00.000-07:00

A factor is basically a financial institution that purchases accounts receivable from businesses. The factor normally bears the credit risks associated with the accounts receivable purchased by it. There are about twenty firms in the United States engaged solely in factoring. These firms raise their operating funds by issue of equity and debt capital.

The factoring agreement governs the relationship between the factor and the business whose accounts receivable the factor purchases. The following conditions are typically found in factoring agreements. The factor will select only those accounts receivable which appear to be acceptable to it. The sales of accounts receivable will be done to the factor on a non-recourse basis. This implies that the factor has to absorb the losses arising from uncollectible accounts.

The factor would set up an account, similar to a bank deposit account, for the firm. Monies will be deposited in this account as payments are received or as due dates arrive. The firm can freely withdraw amounts from this account. Surplus balances in the account earn a certain rate of interest. The factor is liable to pay the firm on the last day of the credit period or when the account is collected, whichever occurs first.

The factor will advance money to the firm against not-yet-collected and not-yet-due accounts receivable. These advances, representing a negative balance in the firm's account, carry a certain rate of interest. Factoring costs consist of three elements: factoring commission, interest levied on advances, and interest paid on surplus balances. Factoring commission is payment to the factor for administering the tasks of receivables management and bearing the risk of bad debt. Factoring commission is usually 1 to 3 per cent of the face value of the accounts receivable factored. The interest period on advances may be 2 to 4 per cent higher than the prime rate.

Factoring provides detailed information on factoring, credit card factoring, loan factoring, invoice factoring and more. Factoring is affliated with Invoice Factoring Discounting

Credit Card Factoring

2008-03-14T05:30:00.000-07:00

Credit policy refers to the combination of decisions pertaining to variables such as credit standards, credit terms and collection. Credit standards constitute the various criteria on the basis of which the customers, to whom credit is to be granted, are evaluated by the firm. Credit terms contain the terms and conditions of extending the credit facility. They include, duration of credit, terms of payment, delivery schedule, discounts etc. Collection efforts comprise the steps taken by the firm in order to collect the book debts from the customers.

There are different types of credit policies being followed by factoring companies. A firm may either follow a tight credit policy or a liberal credit policy. A firm is said to be following a tight credit policy where it sells on credit on a highly selective basis only to those customers with proven credit-worthiness and are financially strong. A firm following a liberal credit policy sells on credit to customers on liberal terms and standards. Credit is granted even for longer periods to those customers whose credit-worthiness and financial soundness are well known.

A tight credit policy means rejection or refusal of certain types of accounts whose credit-worthiness is doubtful. This results in loss of sales and consequently loss of revenues. When the firm loosens its credit policy, two types of administration costs are incurred viz., the cost of credit investigation and supervision and the collection costs. An immediate consequence of liberal credit policy is the accumulation of bad debts, where the firm is unable to collect the debts. This happens because the firm tends to sell even to such customers with relatively less credit standing. In modern days, the credit policy is used as an effective marketing tool capable of boosting the sales volume of the firm. This may be used to maintain the market share, especially in a declining market. Credit policy helps to retain old customers and create new customers by luring them away from competitors.

Factoring provides detailed information on factoring, credit card factoring, loan factoring, invoice factoring and more. Factoring is affliated with Invoice Factoring Discounting

Business Banking & Factoring

2008-03-13T01:23:00.000-07:00

Business banking & factoring services help your business grow immensely

Several factors are responsible for the growth of your business including the hardwork that you put in, optimum finances, expert business knowledge, better business logistics and a host of other ancillaries.

Effective business banking and factoring services can provide your business the needed impetus that can bring a lot of positive results over the time.

An efficient banking institution is the prerequisite of any business organization. There are many aspects that you should consider when opening a new bank account for your business. Different business concerns have different banking requirements. Make it sure that the banking services offered by the banker meets your specific requirements. These days business bankers are providing services like online banking, anytime anywhere banking, telephone banking and similar other services designed to meet your business needs.

Other banking related service is factoring. Factoring means selling your business accounts receivable at discounted price to a factor. A factor may be a financial institution or a bank or any other institution that purchases accounts receivable from business concerns. Factoring allows you to get hold of finances for your business needs as and when they arise. You can get the needed cash within 48 hours. This process provides the immediate cash relief that your business so desperately needs.

There are many financial service providers and banking institutions in UK that provide very efficient business banking and factoring services for your business needs. You may compare their services online, consider the fees and charges that they impose and then select the one that suits your business requirements

Author: The author is a business writer specializing in finance and credit products and has written authoritative articles on the finance industry. He has done his masters in Business Administration and is currently assisting seek-uk as a finance specialist. For more information please visit: http://www.seek.uk.com

International Factoring - How to Finance your Frowing Export Sales

2008-03-13T01:17:00.000-07:00

Are you selling goods or services internationally? Learn how to finance your growing sales.

Selling your goods internationally can be extremely rewarding and challenging at the same time. When you start exporting goods, you truly open your company to a world of possibilities, including the possibility of big financial rewards. At the same time, you expose yourself to some of the challenges of international commerce.

Many international transactions are settled using bank or corporate letters of credit, which means you can rest assured that you will be paid on time. However, many of your clients will insist that you give them payment terms. This means you may need to wait 30, 60 or even 90 days before you get paid. And if your company is growing, waiting to get paid can be very tough.

Going to the bank for a business loan may or may not work. Most banks only give business loans to businesses that have a great past history. But this is of little use to businesses that have a short history but a bright future.

A better option is to consider factoring your invoices, which eliminates the 30 day wait that it takes to get paid. Export factoring (or international factoring as it is also known) can be a very useful tool for new and growing businesses.

Factoring is a form of financing, where a factoring company advances you a substantial portion on your invoices. The factoring company waits to get paid, while you get immediate use of the funds. This eliminates the cash flow issues that happen when you extend terms.

Export factoring is a factoring specialty. Actually, very few factoring companies offer international export factoring, so when talking to companies be sure to be specific and ask if they offer this type of factoring.

Many factoring companies also offer purchase order financing. This factoring product extension provides you with financing to fulfill purchase orders. Purchase order financing gives you the necessary funding to pay your suppliers, using the purchase order as collateral.

If your company is growing and selling goods offshore, be sure to look into factoring and purchase order funding as valuable financing tools to help you grow.

We are trade financing experts and can provide you with international factoring, export factoring and invoice factoring financing. For a quote, call Marco Terry at (866) 730 1922.

Are you a Freight Broker? Learn if Factoring your Freight Bills can Help you Grow your Business

2008-03-12T01:49:00.000-07:00

Running a freight brokerage can be very profitable. Although being a freight broker can be very rewarding, financially speaking, it can also be very challenging. Especially since drivers depend on you to pay them quickly. And many times, your clients make you wait 30 to 60 days before they pay you.

So you have a challenge. Your drivers want to get paid quickly but your clients want to pay slowly. The math doesn't work. Unless you have a nice cash cushion in the bank, paying your drivers will be a problem. And trying to get bank financing will get you nowhere. Banks always provide financing based on your past history. What if you are a new or expanding freight broker?

A better solution is to finance your freight bills through freight broker factoring. Freight factoring provides you with immediate money for your freight bills, giving you the necessary funds to pay your business expenses and most importantly - your drivers. And, as opposed to business loans, freight factoring is easy to obtain. While banks usually look at your past history to make their credit decisions, factoring companies look at your future potential. The main qualification requirement is that you do business with credit worthy clients that pay on time.

If you are a freight broker, factoring your freight bills may be a little bit different from traditional factoring. Most factors will team up with you to find a solution to pay your drivers on time, since this is essential. Others may even pay your drivers on your behalf, helping you handle back office tasks.

Freight broker factoring works as follows:

1. Once the freight has been delivered, you send copies of the documents to the factor 2. The factor advances you up to 100% (less fee) of the freight bill 3. You get immediate use of funds, while the factor waits to get paid 4. Once the client has paid, the transaction is settled

One of the big advantages of factoring is that it is easier to get than a business loan. And, as opposed to business loans, factoring financing grows with your business. The more you invoice, the more financing you qualify for.

About Commercial Capital LLC
Do you know how to find truck loads? Are you moving truck loads of cargo? We help finance freight brokers through our freight broker factoring program. For more information call Marco Terry at (866) 730 1922.

Invoice Factoring Financing for Small Businesses

2008-03-10T23:38:00.000-07:00

Do you sell products or services to commercial or government customers? If you do, then you must be very familiar with having to wait 30, 40 or even 60 days to get paid by your clients.

Most large businesses can afford to wait. Unfortunately, few small business owners can afford to wait - and worse - most small business owners do not take into account that they will have to wait to get paid when they first start their businesses.

But what if you can't afford to wait 60 days to get paid? The best solution is to factor your invoices.

Factoring is a financial tool (similar to a line of credit) that eliminates waiting to get paid by your clients. Factoring financing provides you with money for your invoices, usually 24 hours after you submit them. It provides you with the necessary cash to pay rent, expenses and take on new opportunities.

Invoice factoring is an ideal tool for cash intensive businesses such as trucking, staffing, business services, medical offices and IT. It works as follows:

1. You deliver a product or a service and generate an invoice
2. You submit the invoice to your client and send a copy to the factoring company
3. The factoring company advances you up to 85% of your invoice
4. The remaining 15% is held as a reserve to cover charge backs and credits
5. Once your client pays the factor, the transaction is settled and the reserve is rebated (less a small fee)

And how much does factoring cost? It varies on your business volume, how long your clients take to pay and their credit worthiness. Most factors will charge a fee of anywhere between 1% and 2.3% for every 10 days that an invoice is outstanding. However, fees vary and can usually be customized to fit your needs.

The biggest difference between invoice factoring financing and a bank loan is that factoring is easy to obtain. Since the factor is financing your invoices, their biggest concern is that you do business with strong credit worthy businesses. This means that factoring is available to small and new businesses, provided that you have good clients. And as opposed to a bank, a factoring company will not ask you for endless financial reports and three years worth of audited financials.

About Commercial Capital LLC

Interested in factoring your invoices? We can provide you with a factoring and small business factoring financing. Call Marco Terry at (866) 730 1922 for a quote. Need more info? Go here to get factoring resources, freight bill factoring resources

Can Medical Factoring Financing Fix your Cash Flow?

2008-03-10T02:03:00.000-07:00

Most healthcare businesses have to wait between 15 to 150 days to get claims paid by private insurance, Medicare/Medicaid and HMOs. Although most payments are made in 15 to 45 days, a simple change in billing codes or a request for additional documentation can add weeks or months to the expected payment date of a medical claim.

However, if you own a healthcare practice, DME, hospital or testing center you have expenses that must be paid like clockwork. Payroll needs to be met. Rent needs to be paid. Equipment must be bought. Not surprisingly, all these expenses have one common element - you either pay them or you go out of business.

This leaves you with two possible options. Either you must have a cash reserve sitting at the bank or you need to get financing to cover the wait.

Many healthcare businesses try to get a loan or a line of credit. Although they can work reasonably well, they have one serious drawback. They have limits. And once you reach them, you are usually out of luck if you need additional financing.

The best alternative is to factor your medical receivables with medical factoring. Medical factoring provides you with financing based on your insurance claims, eliminating the wait and providing you with funds to operate your business. And opposed to traditional financing, you have no set limits. You can factor as many insurance claims as you can generate. It's really a tool for growth.

Factoring is easy to implement and incorporate into your business. Here is how it works.

1. You send your claims to the insurance company and to the factor
2. The factor advances you up to 85% of your expected net collections
3. 15% is not advanced and is used as a reserve to handle charge backs
4. You get immediate use of the funds while the factoring company waits
5. When the claim is paid, the transaction is settled

Since factoring relies on the insurance company's payment habits and financial strength, it can be a great tool for new and growing businesses that may not qualify for - or have exhausted - their bank options.

About Commercial Capital LLC
Are you looking to factor your medical receivables? We can provide you with a medical factoring quote. Call Marco Terry at (866) 730 1922. Need more information? please go to our medical factoring resources area

Is Your Freight Company Stuck In Neutral? Finance It With Factoring

2008-03-07T22:37:00.000-08:00

Growth in the trucking industry is all about freight volume. The more freight you move, the faster your company will grow. But big volume comes with a catch ? slow paying customers. Unfortunately, waiting 30 to 45 days to get paid is very common in the industry.

But what if you cannot afford to wait 45 days to get paid by your clients? What if you need to buy fuel, pay drivers or pay for repairs? Employees and suppliers seldom like to wait to get paid.

Needless to say, going to the bank for financing is not an option. They usually do not like to finance small and mid sized businesses. Unless, of course, you have tons of assets, three years worth of financial statements and you have great credit.

So, now what? What are your options?

If you own a trucking company, there is a solution that will provide you with plenty of financing. And as opposed to bank loans, this financing is tied to your freight bills. The more you invoice, the more financing you qualify for.

This solution can provide you with the necessary funds to buy fuel, pay drivers and pay for repairs. And it is available to freight companies of any size. The solution is called freight bill factoring (or freight factoring for short).

Freight bill factoring works as follows:

1. You deliver the freight and invoice your customer
2. You send a copy of the freight bill to the factoring company
3. The factoring company advances you up to 90% of your invoice (10% held in reserve)
4. Once the factoring company gets paid, they rebate you the remaining 10% less their fees

As opposed to bank loans, factoring has no arbitrary high limits. You can factor as many freight bills as you can generate. So, as your company grows, so does your financing.

Factoring is a great tool to finance growing trucking companies that need money to grow. It allows you to take on new opportunities to drive your company to the next level.

About Commercial Capital LLC We specialize in business financing. We can provide you with a free freight bill factoring, freight factoring or invoice factoring quote. For an immediate consultation, call Marco Terry at (866) 730 1922 or http://www.ccapital.net/html/freight_factoring.html or http://www.ccapital.net/html/business_financing.html

Financing Your Pharmacy With Medical Factoring

2008-03-06T00:29:00.002-08:00

Hurry up and wait. If you own a pharmacy that is billing private insurance companies, HMO?s and Medicare/Medicaid you know the meaning of that phrase very well. Hurry up and wait is what happens after you submit client claims for payment. You wait 30, 60 and sometimes 90 days before you get paid.

In the meantime, you still need to pay rent, meet payroll and pay your suppliers. Paying them on time is critical for the success of your business.

So, what can you do if you cannot afford to wait to get paid? Going to the bank won?t help you unless you have been in business three years, have great credit, plenty of assets and can provide three years of audited financials. Without them, banks will seldom lend you a dime.

But there is a financing tool that can provide you with the financing you need. Not only that, as your sales increase, so does your financing. This tool will allow you to have the funds to pay rent, meet payroll and pay your suppliers. It eliminates the hurry up and wait game that insurance companies play.

It is called medical factoring.

Medical receivables factoring provides you with financing based on your slow paying insurance claims. As opposed to bank financing, medical factoring is easy to qualify for and can grow, as your business grows.

It works as follows:
1. You bill insurance companies, Medicare/Medicaid and HMOs as usual
2. You then submit your invoices to the factor for financing
3. The factoring company advances you up to 85% of your expected collections
4. The remaining 15% is kept as a reserve.
5. You get immediate use of the money. The factoring company waits to get paid
6. Once the factoring company is paid, the remaining 15% (less a fee) is rebated

Factoring financing streamlines your cash flow and allows you capitalize on your biggest asset: your slow paying claims from insurance companies. It is an ideal tool for new and growing pharmacies or healthcare providers who need the cash flow to grow and take their business to the next level.

About Commercial Capital LLC We provide business financing. We can provide you with a medical factoring, medical receivables factoring or invoice factoring quote. For a free consultation, call Marco Terry, at (866) 730 1922 or http://www.ccapital.net/html/business_financing.html or http://www.ccapital.net/html/medical_factoring.html

Factoring Your Way To Liquidity

2008-03-06T00:29:00.001-08:00

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, medical factoring, purchase order financing, real estate lending, staffing, systems, technology, trucking, verdict funding, wholesalers, etc.

Various agencies provide all these types of factoring. Usually their turnaround time is 24 hours. They provide exclusive online and paperless factoring solutions to the small and medium sized businesses. These agencies either provide stated rates for factoring of invoices of a particular amount or they offer a free invoice-factoring quote. Thereafter these agencies approach the factoring companies that purchase the creditworthy accounts receivable at a small discount and convert the invoices in to cash.

With the help of these factoring agencies cash is received in mere 24 hours and no debt is created. Since there is no debt created it increases your credit worthiness which can be used to avail a loan. This also represents a healthy balance sheet and strong financial position. These agencies also offer higher advance rates which ultimately results in factoring lesser invoices but generating all the required money.

Moreover the factors handle the collection in professional manner thus reduces the collection costs. They also help in processing of invoices by generating invoices online. This further means increased paperless work. As a result the turnaround time is much shorter than any other means.

Invoice factoring is also known as accounts receivable financing. This practice helps in solving the immediate cash flow problems for small businesses with immediate infusion of money. They also provide a credit facility to small business owners with complete flexibility. This also provides the working capital to the small or medium business owners. This factoring helps in generating working capital without the need of constant renegotiations. Since there is a considerable increase in the working capital it leads to more sales and expansion of business.

A practice of factoring helps small business owners not only to solve their cash problems but also help in increasing sales. Small business owners can also concentrate on their businesses rather than chasing their customers for payments and cash. Factoring practice helps all kinds of small to medium business owners whether they are a small trucking company or any manufacturers.

As a result of invoice factoring, it not only reduces accounting costs but also helps business owners and manufacturers in increased productivity. This practice if factoring the invoices keeps the businessmen from other time consuming jobs like collection, administration, book-keeping, looking up additional capital or warding off creditors.

Finally the best part of factoring is that the business ownership remains unchanged as in case of loan, etc. Since there is no loss of business equity, the ownership percentages remain unchanged.

Henry Byers, Factoring Financial Services advisor - focusing on Factoring Company and Business Factoring

Offshore Outsourcing re-factoring

2008-03-04T23:17:00.000-08:00

Because of the impediments databases the Offshore Outsourcing re-factoring are unfortunately notorious for high level of coupling. In between the database, there is coupling in tables via overseas keys to other tables, and further coupling between those tables and database code, such as triggers and stored procedures, which manipulates those tables. Within the coupling between a database and the systems which access it, is a more significant problem for Offshore Outsourcing, including online software applications, batch jobs, reporting applications and data extraction systems. Systems like this, the same data tables and columns are usually accessed from several parts of the data system, and again use of the interconnection of system. Therefore, a simple data re-factoring can trigger a cascade of other, within Offshore Outsourcing through database and source coding.

The Process: Do not get carried away of primary things, Software Development team should not modify a production database; first of all, the vendor should try out ideas in their own sandbox development, and then examine production implications of proposed changes, while making those changes in the production database consider only if and when it makes sense to IT and Software Development.

For effective working of data re-factoring, it should migrate and convert, while every time the changes occurred for the database schema, it still needs to store the same data to maintain the original semantics of the systems. At the time writing the scripts, copy the affected data to secondary location and convert old schema to the new one, and then start translating the copied data, so that it can write to the new one.

Offshore Outsourcing by scripts The actually need for Offshore Outsourcing by scripts like: The evolvement of the Software Development database and others that will eventually be used as a help for migration of the production database. The script at the time of production is an accumulation for the Software environment, which is an important approach because of re-factoring the development environment. Before running the scripts one must back up their database, so at the time of requirement it can restore it. But writing of the scripts for Offshore Outsourcing is very difficult, with the experience it became a much easy task. In Practice: Well distinguished and designed database process is not an easy way for Offshore Outsourcing solution, with the right approach and the right team support; one can bring the well-known benefits of re-factoring to their database as well as in the coding system. One often has extensive coupling between systems and a database, which makes it as tedious task. Data re-factoring works best when it apply by one at a time, so it can iterate and incrementally release the Offshore Outsourcing work.

For detailed inforamtion log on to: Software Outsourcing News Blog India

How Invoice Factoring Works

2008-03-03T22:37:00.000-08:00

Can?t afford to wait 30 to 60 days to get paid by your clients? If you are like most business owners, waiting to be paid can be very challenging. In some cases it can mean lost opportunities. It can mean that you don?t bid for big sales because you know you won?t be able to play the waiting game. At its worst, it can spell disaster. It can mean that you need to delay payroll. It may mean that you don?t pay rent or taxes. It may force you to shut down your business.

If you are like most business owners, your first reaction will be to call your banker. Unfortunately, banks will not lend money to businesses that are new, have no hard assets or don?t have three years worth of profitable financial statements. At this point, most business owners give up, thinking that they don?t have any other options. However, they do.

If your company sells products or services to large credit worthy companies, you could qualify for invoice factoring financing. Invoice factoring reduces the time it takes for you to get your money to one day. How quickly could you grow your business if your invoices were paid in 24 hours?

As opposed to bank loans, factoring companies do not require hard collateral. The only requirement is that you have invoices form credit worthy clients. Factoring companies work differently than banks. A factoring company will provide you with financing based specifically on your invoices. This means that if your invoicing grows, your financing also grows.

Invoice factoring is very simple:

1. You generate invoices for your products or services
2. You submit the invoices to your clients and to the factoring company
3. The factoring company advances you up to 85% of the gross value of your invoices (the remaining is kept as a reserve to offset disputes)
4. Once the invoice is paid by your client, the factoring company releases the 15% reserve and charges their fee

Factoring financing is easy to qualify for and can virtually eliminate the 30 to 60 days it takes for your customers to pay. It provides you with the necessary working capital to grow your company and take new opportunities.

About Invoice Factoring Group. Need to receivables factoring? We can provide you with a factoring, invoice factoring or accounts receivable factoring quote for free. Marco Terry, the president, can be reached at (866) 730 1922 or at http://factoring.qlfs.com

How Factoring Financing Can Help You Grow Your Business

2008-03-03T22:36:00.000-08:00

Most sales to commercial clients usually carry 30 to 60 day payment terms. This means that as a supplier, you must deliver your products or services now. However, your client has between 30 to 60 days to pay you.

This creates a significant challenge for owners of small and midsize businesses. The problem is simple. Your clients want to pay you in 30 to 60 days, but you must pay rent, payroll and your suppliers now. As you can see, the math does not work. Unless you have a substantial bank account, this leads to an almost impossible situation.

If you are in this situation, it is also very likely that the bank will not be able to help you. As you well know, banks only lend to businesses that have three years of profitable operations and significant hard collateral. If you do not qualify for bank financing, your best bet may be to consider factoring.

Factoring is a business financing tool that helps business owners who cannot afford to wait 30 to 60 days to get paid by their commercial customers. Factoring provides you with the necessary funds to meet payroll, make rent and pay your suppliers on time.

As opposed to bank financing, factoring is easy to qualify for. The main requirements are that you have a profitable business with a strong roster of commercial clients. For the factoring company, your best collateral is the invoices from your strong customers.

Factoring is also easy to use. It enables you receive a substantial portion of your billings within a day of invoicing. It reduces the time you wait to get paid from 60 days to 2 days. The transaction is usually structured as a two installment sale of an invoice. The first installment, called the advance, is paid to you immediately. The advance can be anywhere between 70% and 90% of the gross value of the invoice. The remaining portion (10% - 30%) is held as a reserve to cover disputes and charge backs. The reserve is rebated as soon as the invoice is paid in full. The factoring company will charge a small fee for this service.

Factoring financing is an ideal tool for companies that are growing and that cannot afford to wait to get paid by the clients. It helps you to stabilize your financial situation and positions you for growth.

About Invoice Factoring Group. We can provide you with a factoring, invoice factoring or accounts receivables factoring quote for free. Marco Terry, the president, can be reached at 866 730 1922 or at http://factoring.qlfs.com

Stimulate Company Growth Using Accounts Receivable Factoring

2008-03-02T23:01:00.001-08:00

Accounts receivable factoring is the sale of part or all of a debt that someone owes to your company. When companies purchase a debt through accounts receivable factoring, they pay for your invoice at a discount. They then collect the debt directly from the company who owes you money.

Accounts receivable factoring is distinct from using your accounts receivable as loan collateral because you are outright selling some or all of your receivable to a factor, such as a bank or insurance company, at a discount. You don't collect the debt owed to you from that account anymore, but you also don't have to worry about loan repayments. Accounts receivable factoring makes up about a third of all financing secured by American companies using accounts receivable and inventory as collateral; it's not an uncommon practice. And accounts receivable factoring can help you get large orders that you otherwise wouldn't be able to manage.

Consider the following scenario: you have ten thousand dollars in cash on hand, most of which is currently earmarked for payroll or debt payment. As a relatively new company, you don't have credit enough to use your accounts receivable as collateral for a loan. A large new account becomes available, and you bid on it and win. The problem is, you only have a workforce of fifteen people, and the new contract requires you to staff it with twenty people, purchase several new computers, and find space for the new staff to work out of. And you must do this immediately.

Your ten thousand dollars isn't enough to do this, and you can't get a loan. But you can engage in accounts receivable factoring, sell your current receivables at a small discount, and have the cash immediately on hand to hire the staff, rent the space, and purchase your necessary equipment.

Another possibility - you have a large amount owed to you as in accounts receivable, but one company is paying much too slowly, despite the penalties for late payment. You can sell your not-past-due accounts receivable to an accounts receivable factoring agent in order to maintain your cash flow, and with penalties for late payment applied to the other company, you will probably break even.

Using Accounts Receivable Factoring Wisely

When you sell part of or all of an account to an accounts receivable factoring company, try to get a personal recommendation for the company from a trusted associate: another company's officer, a trusted friend, a bank, etc. If you can't, at the very least ensure your accounts receivable factoring agreement states exact conditions, charges, and procedures for the purchase of your accounts receivable.

And don't use accounts receivable factoring just as a way to get ready cash. Accounts receivable factoring can help you determine whether your payment terms are overly generous, whether the companies to whom you're extending credit are credit worthy, and whether your collections arrangements are adequate for your business. When you speak to the agent arranging your accounts receivable factoring, be it a broker or the actual funder, ask about these things. Accounts receivable factoring companies are interested in long-term ongoing relationships with companies, and will be happy to help you ensure your procedures and information concerning accounts receivable are adequate for your needs.

You should never use accounts receivable factoring for debts you suspect won't ever be paid. Again, you want to develop long-term relationships with accounts receivable factoring companies; they can help your company grow for a long time into the future. But if you sell them accounts they can't collect on, you can be certain they won't work with you again, and they may share that information with other accounts receivable factoring companies as well.

Henry Byers, Accounts Receivable Factoring advisor - focusing on Business Factoring and Factoring Receivables

Growing Your Supply Company With Medical Factoring

2008-02-29T23:22:00.000-08:00

Medical supply companies in general are very profitable enterprises. However, most medical supply companies operate on a very tight cash flow. Unfortunately, the challenging billing procedures and slow payment cycles of insurance companies, HMOs and Medicare/Medicaid create a situation where many companies wait 30 to 60 days before getting paid.

Cash flow can get even tighter if the company?s sales grow, or if the owners decide to open new locations. When this happens, most company owners try to obtain bank financing through a loan or line of credit. However, qualifying for bank financing is incredibly challenging as they will only lend money to a business that shows profits for three straight years and can provide audited financials.

There is a financing alternative in the healthcare industry that has been used with success with medical supply companies. This solution provides you with quick financing based exclusively on your sales. Furthermore, since financing is tied to sales, the line of financing grows as your sales grow. The solution is to factor your medical insurance claims using medical receivables factoring.

Medical factoring provides you with immediate financing based on your slow paying insurance and Medicare/Medicaid claims. Rather than waiting 30 to 60 days to get paid, with medical factoring you can get paid in a few days. This frees up significant cash, allowing you to finance operations, and more importantly, to buy supplies and fuel new sales.

As opposed to bank financing, where the bank lends you money, the factoring company buys your invoices and pays you immediately for them. The process is fairly straightforward. But more importantly, this also means that you are free from the traditional bank lending requirements. Medical receivables factoring is easier to qualify for, and often, the owners? personal credit is not a consideration.

Factoring your medical receivables can be an ideal solution for your medical supply company if your main challenge is that you cannot afford to wait up to 60 days to get paid by insurance companies. If that is the case, medical factoring should provide you with the working capital you need to operate and grow your business.

About Invoice Factoring Group - http://factoring.qlfs.com We can provide you with a free medical factoring, medical receivables factoring or invoice factoring quote for your healthcare company. Marco Terry, the president, can be reached at 1 866 730 1922 or at http://factoring.qlfs.com/html/medical_offices.htmlCommercial Capital LLC.

Growing Your Trucking Company With Freight Factoring

2008-02-29T23:21:00.000-08:00

Trucking companies are one of the most cash hungry businesses in the transportation industry. There are driver expenses, equipment expenses and fuel expenses. However, trucking companies can also be very profitable, if cash flow is managed properly.

One of the main challenges that trucking company owners face is that freight bills can take as long as 60 days to get paid. This puts them in a tough spot, because unless the company has a significant amount of cash in the bank, it usually cannot afford to wait to get paid.

Usually, the owner will try to go to the bank to obtain financing hoping that a loan or line of credit might solve the problem. Unfortunately, banks will seldom finance businesses that have less than three years of audited financials that show consistent profits. Of course, if the trucking company could provide three years of financials that show profits, it would not need financing.

A better solution is to use freight factoring. Freight bill factoring enables you to convert your slow paying freight bills into cash by selling them to a factoring company. This provides you with immediate financing and allows you to cover all your ongoing business expenses. Also, as opposed to bank lines of finance, freight bill factoring automatically grows as your sales grow, providing you with flexible financing.

The process is simple. The factoring company buys your invoices and pays for them up front. The transaction is typically done in two installments. The first installment is called the advance and the invoice factoring company provides you with up to 90% of the invoiced amount. The remaining 10% is held as a reserve to cover disputes or charge backs. The remaining 10% (less a fee) is rebated as a second installment, once the invoice is actually paid.

The factoring fee is based on how long the invoice is factored for and the monthly volume of factored invoices. Discount rates average between 1.8% and 4% per month based on these parameters.

Most factoring companies buy invoices using a non-recourse factoring. Under a non-recourse agreement, the factoring company bears the risk of non-payment if your client becomes insolvent or goes out of business. This is a nice benefit of factoring and increases the peace of mind of business owners.

Freight bill factoring is an ideal solution for a new and emerging trucking company, and provides you with the necessary financing to operate and grow your business.

About Invoice Factoring Group - http://factoring.qlfs.com We are a factoring company that can provide you with a freight factoring, freight bill factoring and accounts receivable factoring quote at no cost. Marco Terry, the president, can be reached at (866) 730 1922 or at http://factoring.qlfs.com/html/freight_bill_factoring_for_tru.html Commercial Capital LLC.

Growing Your Business With Accounts Receivable Factoring

2008-02-28T21:39:00.000-08:00

Having to wait up to 60 days for commercial customers to pay their invoices can be one of the biggest challenges that owners of small to mid size companies have to face. Waiting to get paid is not usually an issue for well-established companies that have a significant cash cushion in the bank. However, it can seriously affect smaller companies or companies that are going through a significant growth phase.

Most owners react to this cash flow problem by going to the bank, hoping to obtain a loan or a line of credit. However, banks have strict lending guidelines and seldom lend money to businesses that cannot demonstrate three years of profitable operations and cannot provide audited financial statements. Furthermore, most bank financing products tend to have arbitrary limits, which are based on your existing financial capacity, rather than your projected growth.

What growing businesses need is a form of financing that is tied to sales, allowing you to get more working capital, as your company grows. Furthermore, the solution should work for small and mid size businesses that may not have established credit histories, but that have great paying customers. Is there such a solution?

If you are in a situation where your business is growing and selling products or services to great credit worthy customers, you should consider factoring your invoices as a possible solution. Accounts receivable factoring allows you to convert your slow paying receivables into cash, by financing them through an accounts receivable factoring company. Accounts receivable factoring is a flexible line of financing that is directly tied to your sales. Basically, the more you sell to good customers the more financing you can obtain.

The process is fairly simple. Once an accounts receivable factoring agreement has been established, you send copies of your invoices to the factoring company, who in turn advances you a significant portion of their value. A small percentage is usually not advanced and kept as a reserve to cover disputes/etc. You obtain immediate funding to pay for company expenses and grow the business, while the factoring company waits to be paid by your customers. Once they get paid, they will rebate the funds that were kept in reserve and charge a small fee for the service.

Accounts receivable factoring is an ideal product for companies that are growing quickly and cannot afford to wait 30 to 60 days to receive payment from their customers. It provides you with the necessary financing to operate and grow your business, and as opposed to bank products; it?s easy to qualify for this service.

Invoice Factoring Group - http://factoring.qlfs.com - is a factoring company that can provide you with a free accounts receivable factoring or receivables factoring quote. Marco Terry, the president, can be reached at (866) 730 1922 or at http://factoring.qlfs.com/html/accounts_receivable_financing.html

Achieving Cash Flow Management Through Accounts Receivable Factoring

2008-02-26T22:53:00.000-08:00

Accounts receivable factoring is another mode of receivables management and working capital funding to eventually increase the cash flow. Accounts receivable factoring involves buying and selling of accounts receivables in order to obtain immediate cash or working capital.

Accounts receivable factoring helps in acquiring cash for the product or the services rendered. It results in immediate cash inflow without creating any debt or transferring the business ownership. Accounts receivables are the most values assets for any company. It is one of the mode for increasing sales and expanding business. The payment is done of the 80% of the invoice value. The 20% of the value is kept as reserved and is paid after deducting the fee once the amount on the invoice is due.

This practice if accounts receivable factoring is most suitable for small and medium business owners. Due to accounts receivable factoring small and medium business owners are able to generate cash and avoid the debt trap. It also helps in representing string financial status and avoids interest on any loans if otherwise taken.

Accounts receivable factoring also results in increased working capital as receivables are conditional on customer's creditworthiness and not the business owners. It helps to avoid loan repayment, transferring business equity, engaging the assets, and also avoid yearly loan review process. For a small business owner accounts receivable factoring represents gaining working capital without overtaking any debt or loan. It is also a mode to increase sales without any repayment tensions for any loans etc. Thus business is able to meet demands and the circle keeps on auto-rotating as accounts receivable factoring increases sales and increased sales asks for more money to complete more orders.

Accounts receivable factoring also provides relief from non-paying clients or slow paying clients. It generates more sales due to increased orders. It also offers flexible funding program to help heighten the sales graph and take vendor discounts due to availability of cash.

This practice of accounts receivable factoring generates cash to fund the payrolls and taxes due. The funds thus generated also help to increase the inventory or buy new equipments, tools, etc to flourish the business.

The availability of cash helps small business owners to negotiate for discounts from their vendors and suppliers. It also helps to reduce book keeping, depositing checks, monitoring collection process, and preparing reports for collections. Brokers or agencies also provide their services for accounts receivable factoring. They help the business owners to manage their collections, payments, generating more cash and managing their cash inflow process.

Henry Byers, Business Factoring advisor - focusing on Factoring Services and Accounts Receivable Factoring

Financing your Business with Accounts Receivable Factoring

2008-02-26T00:25:00.000-08:00

Most owners react to this cash flow problem by going to the bank, hoping to obtain a loan or a line of credit. However, banks have strict lending guidelines and seldom lend money to businesses that cannot demonstrate three years of profitable operations and cannot provide audited financial statements. Furthermore, most bank financing products tend to have arbitrary limits, which are based on your existing financial capacity, rather than your projected growth.

What growing businesses need is a form of financing that is tied to sales, allowing you to get more working capital, as your company grows. Furthermore, the solution should work for small and mid size businesses that may not have established credit histories, but that have great paying customers. Is there such a solution?

If you are in a situation where your business is growing and selling products or services to great credit worthy customers, you should consider factoring your invoices as a possible solution. Accounts receivable factoring allows you to convert your slow paying receivables into cash, by financing them through an accounts receivable factoring company. Accounts receivable factoring is a flexible line of financing that is directly tied to your sales. Basically, the more you sell to good customers the more financing you can obtain.

The process is fairly simple. Once an accounts receivable factoring agreement has been established, you send copies of your invoices to the factoring company, who in turn advances you a significant portion of their value. A small percentage is usually not advanced and kept as a reserve to cover disputes/etc. You obtain immediate funding to pay for company expenses and grow the business, while the factoring company waits to be paid by your customers. Once they get paid, they will rebate the funds that were kept in reserve and charge a small fee for the service.

Accounts receivable factoring is an ideal product for companies that are growing quickly and cannot afford to wait 30 to 60 days to receive payment from their customers. It provides you with the necessary financing to operate and grow your business, and as opposed to bank products; it's easy to qualify for this service.

Medical Factoring Financing - A Tool for Medical Supply Companies

2008-02-26T00:24:00.000-08:00

Cash flow can get even tighter if the company's sales grow, or if the owners decide to open new locations. When this happens, most company owners try to obtain bank financing through a loan or line of credit. However, qualifying for bank financing is incredibly challenging as they will only lend money to a business that shows profits for three straight years and can provide audited financials.

There is a financing alternative in the healthcare industry that has been used with success with medical supply companies. This solution provides you with quick financing based exclusively on your sales. Furthermore, since financing is tied to sales, the line of financing grows as your sales grow. The solution is to factor your medical insurance claims using medical receivables factoring.

Medical factoring provides you with immediate financing based on your slow paying insurance and Medicare/Medicaid claims. Rather than waiting 30 to 60 days to get paid, with medical factoring you can get paid in a few days. This frees up significant cash, allowing you to finance operations, and more importantly, to buy supplies and fuel new sales.

As opposed to bank financing, where the bank lends you money, the factoring company buys your invoices and pays you immediately for them. The process is fairly straightforward. But more importantly, this also means that you are free from the traditional bank lending requirements. Medical receivables factoring is easier to qualify for, and often, the owners' personal credit is not a consideration.

Factoring your medical receivables can be an ideal solution for you medical supply companiy if your main challenge is that you cannot afford to wait up to 60 days to get paid by insurance companies. If that is the case, medical factoring should provide you with the working capital you need to operate and grow your business.

We can provide you with a free medical factoring, medical receivables factoring or invoice factoring quote for your healthcare company. Marco Terry, the president, can be reached at 1 866 730 1922.

Learn How To Finance Your Healthcare Business With Medical Factoring

2008-02-14T02:06:00.000-08:00

There are few bigger pains for healthcare industry professionals than having to wait 30, 60 or even 120 days to collect payments from insurance companies, HMOs and Medicare/Medicaid. The healthcare industry is riddled with complex billing, coding and processing rules that create very long payment cycles. This can be very difficult for medical offices, testing and diagnostic centers, medical supply companies, or any healthcare related business, for that matter. There are always many ongoing expenses that can?t wait. There is rent that needs to be paid, offices expenses that need to be covered, and payroll that must be met.

This situation creates a problem for most healthcare businesses. On paper, the business may look very profitable and seem to be doing well. But in reality, most of the money is tied up in slow paying invoices (also known as accounts receivable) with little cash to show for it in the bank.

When faced with tight cash flow, most healthcare professionals turn to their bankers. Medical doctors can usually qualify for signature loans or lines of credit. Other business professionals are not so lucky. In reality, a loan or line of credit may help you in the short term, but will not solve the main problem. Why? Well, loans are good for buying equipment or large capital expenditures, but not for covering recurring and ongoing expenses. A line of credit is a better solution, but they usually have fixed limits. What happens if the business grows past the limits of the line of credit? Many healthcare professionals usually find out, the hard way, that the bankers that were quite happy to extend the first loan or line of credit will not be so helpful at increasing it. Unfortunately, bankers absolutely hate it when businesses came back to the well for more money.

If you look at the problem at hand, you will soon realize that the perfect solution should have the following characteristics. First, it should be able to accelerate your insurance payments so that you can get them quickly rather than slowly. Second, the solution should be able to grow with your business. So, if your business grows its billings, the solution should be able to adapt the financing it delivers, seamlessly. Third, the solution should allow you to finance significant growth. Maybe three to five times your current revenues ? or more.

There is a solution that meets these criteria and is available to the healthcare industry. The solution is to factor your medical receivables using a financing tool called medical factoring. Medical factoring allows you to accelerate your payments from insurance companies, HMO?s or Medicare/Medicaid. It enables you to receive a substantial amount of your net collectables within days of billing, streamlining your cash flow dramatically.

Medical factoring, a specialty form of general factoring, allows you to sell your claims and receivables to a factoring financing company. The factoring company buys them ? at a small discount ? and pays you with immediate funds. The factoring company waits to be paid while you get to use the funds to meet business expenses. As opposed to traditional banking financial products, medical factoring has no arbitrary limits. You can factor or sell as much revenue as you can generate, making it the ideal financing tool for growth.

However, factoring is not the best solution for every situation. It works best in instances where your main challenge is that you cannot afford to wait to get paid in 60 to 120 days. It helps you meet ongoing and recurring expenses such as rent, payroll and lease payments. Medical factoring is an ideal solution for medical offices, rehabilitation centers, medical testing and diagnostic centers, medical supply companies and small to mid sized hospitals.

Invoice factoring Group can provide you with a medical factoring and medical receivables factoring quote for free at http://factoring.qlfs.com/html/medical_offices.html . Marco Terry, the president, can be reached at (866) 730 1922

Can Medical Factoring Help Boost You Healthcare Business Finances?

2008-02-13T01:54:00.000-08:00

This situation creates a problem for most healthcare businesses. On paper, the business may look very profitable and seem to be doing well. But in reality, most of the money is tied up in slow paying invoices (also known as accounts receivable) with little cash to show for it in the bank.

When faced with tight cash flow, most healthcare professionals turn to their bankers. Medical doctors can usually qualify for signature loans or lines of credit. Other business professionals are not so lucky. In reality, a loan or line of credit may help you in the short term, but will not solve the main problem. Why? Well, loans are good for buying equipment or large capital expenditures, but not for covering recurring and ongoing expenses. A line of credit is a better solution, but they usually have fixed limits. What happens if the business grows past the limits of the line of credit? Many healthcare professionals usually find out, the hard way, that the bankers that were quite happy to extend the first loan or line of credit will not be so helpful at increasing it. Unfortunately, bankers absolutely hate it when businesses came back to the well for more money.

If you look at the problem at hand, you will soon realize that the perfect solution should have the following characteristics. First, it should be able to accelerate your insurance payments so that you can get them quickly rather than slowly. Second, the solution should be able to grow with your business. So, if your business grows its billings, the solution should be able to adapt the financing it delivers, seamlessly. Third, the solution should allow you to finance significant growth. Maybe three to five times your current revenues - or more.

There is a solution that meets these criteria and is available to the healthcare industry. The solution is to factor your medical receivables using a financing tool called medical factoring. Medical factoring allows you to accelerate your payments from insurance companies, HMO's or Medicare/Medicaid. It enables you to receive a substantial amount of your net collectables within days of billing, streamlining your cash flow dramatically.

Medical factoring, a specialty form of general factoring, allows you to sell your claims and receivables to a factoring financing company. The factoring company buys them - at a small discount - and pays you with immediate funds. The factoring company waits to be paid while you get to use the funds to meet business expenses. As opposed to traditional banking financial products, medical factoring has no arbitrary limits. You can factor or sell as much revenue as you can generate, making it the ideal financing tool for growth.

However, factoring is not the best solution for every situation. It works best in instances where your main challenge is that you cannot afford to wait to get paid in 60 to 120 days. It helps you meet ongoing and recurring expenses such as rent, payroll and lease payments. Medical factoring is an ideal solution for medical offices, rehabilitation centers, medical testing and diagnostic centers, medical supply companies and small to mid sized hospitals.

Invoice Factoring Group

Invoice Factoring Group can provide you with a medical factoring and medical receivables factoring quote for free. Marco Terry, the president, can be reached at (866) 730 1922

Can Medical Factoring Help Finance Your Fast Growing Office?

2008-02-13T01:53:00.000-08:00

Regardless of what industry pundits say, opening a medical practice can be both very rewarding and very lucrative. Of course, as with any business, medical offices have their own specific financial challenges. One of the biggest challenges for medical practices of all sizes is adjusting to the long payment cycles of private insurance providers and Medicare/Medicaid. It is not uncommon for bills to insurance companies to take up to 120 days to pay. This slow payment cycle wreaks havoc in the office?s cash flow, forcing the medical office to carry the costs of doing business ? paying rent, equipment leases and office staff ? while waiting to get paid. This can be prohibitively expensive and prevent the office from growing and hiring additional staff. At its worst, it can threaten the very existence of the medical practice.

However, there is a light at the end of the tunnel. There is a financing tool that lets you capitalize on your slow paying insurance companies and turn their slow payments into immediate payments. The solution is to factor your medical receivables.

How does medical receivables factoring work?

Medical receivables factoring (or medical factoring for short) is a financing tool that allows you to turn slow paying invoices into actual cash, by selling them to a medical factoring company. The medical factoring company pays you for them and waits to be paid by the insurance companies. It eliminates the slow payment cycle, reducing the payment time from 90 days to two days. This provides the medical office with the necessary funds to meet expenses, such as paying rent and staff. It also frees up capital to grow the business into new areas.

The medical factoring process is fairly simple. Once a factoring arrangement is established, your office sends its weekly receivables to the factoring company for immediate financing. The factoring company will calculate the actual amount paid by insurance companies (called the net collectibles) and advance you up to 80% of that amount. The remaining 20% is called the reserve, and is used to settle billing discrepancies. Once the insurance company pays the medical bill, the remaining 20% is rebated, less the financing fee. The financing fee varies based on how long the invoices were financed.

Although qualifying for factoring is relatively simple, most financing companies will only work with medical offices that have net collectibles of at least $50,000. Terms usually get better as the practice grows. Medical practices, testing centers and medical supply companies that have over $200,000 a month in net collectibles are in the best position to get the best terms. This is because insurance payment processing can be very complex and there are a number of efficiencies that can be realized with high volumes.

Advantages of medical office factoring

Medical office factoring has some advantages over other financial products. The most important is that the financing is recurring and happens every time you invoice an insurance company. This makes it a cash on demand product. As opposed to loans and lines of credit, the factoring line has flexible limits. As a matter of fact, the limits are based on your ability to invoice, making it an ideal growth tool. Lastly, doctor office factoring is easy to qualify for and the personal credit of the practice owners is usually not involved in the financing decision.

Invoice Factoring Group can provide you with a medical factoring or medical receivables factoring quote for free at http://factoring.qlfs.com/html/medical_offices.html Marco Terry, the president, can be reached at 1-866-730-1922. Copyright? 2006 ? All rights reserved. Article may be reprinted provided it isn't modified

How to use freight bill factoring to finance your trucking company

2008-02-11T02:54:00.000-08:00

There are few businesses that are as cash flow intensive as a trucking company. The list of ongoing expenses can be endless and can easily overwhelm small and medium size trucking companies. There are fuel expenses, truck repairs, rentals and salaries. Although most trucking companies are very profitable, few can afford to wait the usual 30 to 60 days it takes to get paid for their freight bills.

Unless the trucking company has a significant cash cushion in the bank, waiting 30 to 60 days to get paid can cause serious problems. It can jeopardize existing operations and furthermore, it can prevent you from growing your business. The only way to get out of the cash flow rut is to find a way to capitalize on your slow paying invoices. The best tool to do this for a trucking company is called freight bill factoring.

Freight bill factoring enables the trucking company to get paid for their freight bills within a day of invoicing, eliminating the usual 30 to 60 day wait. With a factoring agreement in place, you can stabilize your company's cash flow and eliminate the stress of not knowing when you'll be paid. Since freight bill factoring eliminates the worries of waiting for your payment, you will be free to focus on what you do best: running your business.

Who qualifies for freight bill factoring?

Most small and mid size trucking and transportation companies should qualify for factoring. There are two main requirements to qualify. First, your company must do business with reputable clients or freight brokers. Second, your company must be free of tax problems. If you meet these two criteria, more often than not you will qualify. Most factoring companies are comfortable working with new businesses, so you should be able to qualify even if your company is a start up. Best of all, you can get a financing agreement in place within a few days.

What services does a factoring company provide?

The main benefit of working with a freight bill factor is that this will provide you with advanced funds on your freight bills. That means you can get paid very quickly after invoicing. However, most factors will also provide you with collections and credit protection as part of their services. This enables you to focus your energies and your staff on growing your company rather than on expensive and time consuming back office work.

Factoring for growth

Although many truck operators initially obtain factoring financing to avert the problems of dealing with slow payers, eventually most owners realize that factoring can help them grow their business. It eliminates their biggest worry by ensuring that invoices get paid immediately, freeing up cash and enabling the owner to grow the business.

About Invoice Factoring Group

Invoice Factoring Group (http://factoring.qlfs.com) can provide you with a free trucking company / freight bill factoring quote. Marco Terry, its president, can be reached at (866) 730 1922.

Invoice Factoring As A Short-Term Cash Flow Solution

2008-02-11T02:53:00.000-08:00

Invoice factoring refers to the practice where smaller companies sell invoices in order to receive money today. IN this case they do not have to wait for a credit period of 30, 60, or 90 days. Thus by selling invoices smaller companies do not create debt. This practice of invoice factoring is basically used as a finance management tool.

This practice of invoice factoring is usually adopted to avoid any loans or giving any collateral against availing any loan. The fee for invoice factoring is paid in terms of discount. This discount can ranger anywhere between 2.5% to 7%. As a result of invoice factoring the smaller companies avoid exhibiting any loans on their balance sheets plus they also do not have to pay any interest for the money taken. This results in better profit figures.

Various agencies also help small companies in invoice factoring. These agencies set up the company with the right factor for a particular factoring situation. If someone has an invoice or any receivable to be factored then these agencies come out to help in the same.

These agencies help the manufacturers, distributors, importers, exporters, wholesalers, contractors, suppliers etc equivocally. They also help truckers in construction invoice factoring. These agencies help to locate best factor for a particular situation within the area or can also help to choose from nationwide factoring companies to avail the best rates. They usually customized solution as per the clients need. To avail the services of such companies firstly a form needs to be filled out stating the type of receivables and other details required for invoice factoring. Then these companies approach the probable paying parties that avail invoice factoring. Some of these agencies assume the risk in the deal for non-recourse factoring where the client is not required to pay back.

There are different types of companies with different types of rates for factoring. Any invoices or receivables to the amount of $100,000 can be factored immediately. The average rate payable for discount in such cases is 2-5%.

Some agencies specialize for a certain category of invoice factoring. For example, some agencies indulge only in invoice factoring for medical industry. Some agencies, which cater to small and medium businesses for invoice factoring, create invoices online and receive immediate funding. They usually give a 24 hours turnaround. Other types of agencies also give funds to small businesses for their day to day operations against collateral of their invoice or purchase order. These kinds of agencies also buy mortgage notes, structured settlement annuity or medical receivables.

Henry Byers, Receivable Factoring advisor - focusing on Invoice Discounting and Invoice Factoring

Why Try Factoring?

2008-02-09T01:35:00.001-08:00

When you engage in factoring or selling your accounts receivable, you're accepting less money for an asset than you might expect to get for it. But there are great reasons for factoring and here are 10 of them:

1. The ready cash you'll get by factoring will help your company to grow. If you have $2000 ready cash in the bank, but you've invoiced for $100,000 down the line this will lead to $75,000. Think about it: the ability to hire more necessary staff, buy needed equipment, and have stock on hand could make a real difference to your business.

2. Ready cash can help you pay your suppliers sooner, helping you negotiate discounts and have a larger credit line than you had before.

3. Factoring your current invoices gives you the capital to take on large, deadline-oriented contracts and orders that you'd otherwise have to pass up because of slow cash flow.

4. Those large accounts are worth money. Having cash on hand now allows you to offer longer payment terms to the new large accounts.

5. Out of marketing comes business. With ready cash you can get from factoring, you can buy billboards, newspaper and radio ads, and even have direct mail campaigns for those timely marketing campaigns.

6. If you've invoiced too much and now are finding yourself in a cash crunch, factoring will help you to meet your current expenses right away, reducing the chance of not being able to pay your bills. Nothing is worse for your company than not meeting payroll; you lose your best employees, and the ones who stay are probably going to be seeking other employment.

7. You can improve your balance sheet with working capital without incurring debt.

8. Pay off limited lines of credit, or lines of credit that are costing you too much in interest and fees.

9. Factoring out slow debts allows you to skip the unpleasantness of making payment collection calls; instead, the factoring company does this for you.

10. If you factor out part of your accounts receivable, the factoring company will give you a free analysis and comparison of what payment terms and credit amounts your customers really qualify for. This is invaluable information for conducting business in the future.

In addition to these ten great reasons to try factoring your accounts, there are a few reasons never to factor your accounts. If you're concerned about late and slow payments without a good reason such as; you've given a thirty-day due date to someone and they take forty days to pay, then factoring is not a good idea. Instead, you should change your business practices to give a shorter due date. If you think your customer won't pay, factoring their invoice out is dishonest, and will win you no points with a factoring company. Do you really want to ensure you have a bad reputation with people who trust you with a large amount of their capital?

If you're in a dispute with a customer and you decide factoring out your invoice is a way out, you're wrong. The customer could simply refuse to pay the factoring company and then sue you, or worse, tell everyone else what a horrible company you run. Face your disputes head on. If you are dissatisfied with the customer, don't do business with them again.

Factoring to sustain a non-profitable business without some hope of profitability in the future is a sure way to drive your self into bankruptcy. Instead, you should let your business die a dignified death. Factoring so that you can remove cash from your business is a bad idea, akin to taking out a dozen credit cards so you'll have money now. When you engage in factoring, you're essentially agreeing to a profit loss; you should only do this if you stand to make more money in the long run.Henry Byers, Factoring advisor - focusing on Receivable Factoring and Invoice Discounting

How factoring your invoices can help your business grow

2008-02-07T23:52:00.001-08:00

Every day many business owners hit a wall. That wall prevents them from growing their business, or at least, severely limits the speed at which they can grow their companies. Sometimes, and especially for small and mid size businesses, the wall appears to be insurmountable. That wall is lack of working capital. Let's take a look at the most common source of working capital problems: extending payment terms to customers.

There are few things that small business owners hate to hear more than a customer utter the words, "We'll be happy to do business with you. However we pay net 45 days". As is well known, commercial clients like to pay their invoices in 30 to 45 days. As a business owner, you are expected to go through the trouble and expense of delivering your product or service on time... only to then wait 30 to 60 days to get paid.

It does not take a long time before the business has a lot of money tied up in their unpaid invoices - or accounts receivable. At this point the business may have more money in unpaid invoices than actual cash in the bank. When they reach the breaking point, they hit the wall. They can no longer supply new products until old invoices pay. Sometimes it's even worse. The business may stop operating until old invoices pay. Payroll is missed. Key suppliers are not paid. Unless this is fixed quickly, the business will certainly face major problems. If you hit the wall, there are two options. Either you step on the brake and stop growing your business, which means your competition gets the contracts, or you blast through the wall using some form of financing. Invoice factoring can help you do just that.

Your unpaid invoices are an asset - really!

Companies that hit the wall have a great asset that can be turned into immediate funds. They just don't know it. This asset is their unpaid invoices from credit worthy clients. Let me give you an example. Let's say that you have a $10,000 invoice from General Electric payable in 45 days. Do you think GE will pay? Isn't that invoice almost as good as money? Well, of course. GE is arguably one of the best and most financially stable companies on the planet. Most people would certainly consider that invoice to be "almost cash". Unfortunately, banks will seldom provide you any financing that relies on that "almost cash". However, there is a solution that relies solely on the power of your unpaid invoices. It is called factoring.

Invoice factoring. Financing your business without debt

Invoice factoring allows you to turn your slow paying invoices from good customers into immediate cash. It's a very simple transaction in which you trade an invoice - "almost cash" - for actual cash. Basically, the factoring company provides financing solely on the power of your soon to be paid invoices.

Provided that you have good customers, you can repeat this process for every invoice you have, almost indefinitely. If you sell products to good credit worthy customers, a factoring company will gladly buy your invoices. There are no limits, except how much you can sell.

One important thing to know about factoring is that it doesn't generate debt. The factor does not loan you money for your invoices. It buys them outright from you at a small discount. Since factoring is not a loan, qualifying for it is easy and your financial statements look cleaner. You just need a well-run business and great customers.

Who is a good candidate for factoring?

Factoring is a great resource for companies that have great paying - albeit slow paying - customers. To work well, the company should have profit margins of at least 15%. However, higher margins of 25% - 50% are more desirable.

Factoring works well for companies that have hit the wall and are turning away new business opportunities because of lack of money. In these instances, factoring will almost always allow you to grow your company immediately and will more than pay for itself.

Factoring works well for almost any industry. Some very successful staffing companies, trucking companies, IT consultancies, construction firms, manufacturers and service providers have used factoring to dramatically grow their businesses.

A sample factoring transaction

Let's take a look at a sample invoice factoring transaction. This will help you better understand how this financial tool works. Let's say that you have a company, called Super Services Inc. Super Services sells products to two clients. The clients are Company A and Company B. The factoring would look as follows:

1. Super Services delivers its products to Company A and Company B 2. Super Services sends Company A and Company B an invoice for its products. At the same time, it sends copies of the invoices to factor 3. The factoring company receives the invoices and advances funds to Super Services. Super Services can use the funds to grow the business 4. The factoring company waits to get paid. Once it gets paid, the transaction is settled

As you can see, invoice factoring is a fairly straightforward tool that allows business owners to capitalize on their most precious asset - their invoices.

Invoice Factoring Group

Invoice Factoring Group and its small business invoice factoring subsidiary can provide you with factoring quotes at no cost to you. Marco Terry, its president, can be reached at 866-730-1922.

What is Factoring and Invoice Discounting?

2008-02-06T22:36:00.001-08:00

Factoring and invoice discounting (known as debtor finance) can dramatically improve your cash flow by releasing money as soon as you have completed an order and raised an invoice rather than having to wait for your customer to pay. This makes them ideal for funding growth. Because it's linked to sales, factoring or invoice discounting is ideal if your business does not have the financial track record or security available to negotiate sufficient overdraft facilities.

A key advantage is flexibility. The amount you can borrow grows in line with sales and it is often possible for you to repay bank facilities and release previously pledged security.

Typically, when factoring is set up you can borrow about 80% of the value of your approved invoices less than 90-120 days old. Thereafter, cash will be made available against invoices on a daily basis with the remaining 20%, less charges, once the value of the invoice has been collected. Once the system is established, the level of advance you receive against invoices depends on a number of issues, but can rise as high as 100%.

Once in place, there is no limit to the amount you can borrow as the finance is linked directly to sales. This is in sharp contrast to bank overdrafts, which require regular re-negotiation and arrangement fees.

The cost of such a facility is normally up to 3% over base rate for the money borrowed together with a service charge linked to gross turnover of at least 0.5% depending upon the level of annual sales, the number invoices raised and how many live accounts are on the sales ledger. Small addition charges are often made for extra services such as credit insurance.

John Courtney AIMC, MABS, MInstDis, is the managing director of Strategy Consulting Limited (http://www.strategyconsultinglimited.co.uk). Having trained at The Academy of Business Strategy, and is an associate of the Institute of Management Consultancy and a member of the Institute of Directors, he is also a visiting lecturer on the MBA course at Cranfield University School of Management and a Judge in The National Business Awards

What Is Invoice Factoring And Invoice Discounting

2008-02-05T22:54:00.001-08:00

The Romans were the first civilization to sell promissory notes at a discount, beginning the industry of factoring. America was built largely on the possibilities of factoring, when colonial businesses were factored by Europeans willing to invest cash in exchange for the promise of large returns, and government bonds also use the same principles applied by businesses when they engage in invoice factoring.

Invoice factoring is, at its simplest, the sale of the right to collect cash owed on your outstanding invoices. Most businesses engage in invoice factoring when they need cash up front quickly, or when they have customers that are slow to pay and don't have the resources to build an accounts collections department. Though some companies are large and established enough to get accounts receivable financing through a regular bank, it can be handy to have access to invoice factoring companies as well.

Most businesses use invoice factoring to get fast cash. In the intense and fast paced business environment of today, ready cash can be invaluable. With the sale of your invoice futures, you can get the cash today you need to capture customers that will move your business forward.

Invoice factoring is not a loan; rather, it's an outright sale of an asset. Another way of looking at it is as a cash advance: you give up a certain portion of the money you expect to receive in the future in exchange for ready cash today. While some businesses purchase invoices outright, others give you a down payment toward the invoice, paying you the balance less their fee when they receive payment from the customer. One of the best things about invoice factoring is that your credit has no bearing on whether you are approved; instead, your customer's credit qualifies the invoice for factoring.

Many different industries take advantage of invoice factoring, including:

* Transportation
* Manufacturers
* Distributors
* Wholesalers
* Staffing and consulting firms
* Telecommunications companies
* Service providers

Because ready cash is so important in their business, industries that are heavily vested in human services and need to be able to meet payroll are among the best able to leverage invoice factoring. However, any business that generates at least ten thousand dollars in accounts receivable should be able to use invoice factoring, provided they've acquired creditworthy customers.

Other situations that might make invoice factoring a wise choice for you include:

* A young company with creditworthy customers, but not sufficient credit history for your own business to be considered creditworthy by banks
* A company with the necessity of taking advantage of new, time-limited sales and profit opportunities, but inadequate cash flow currently to do so
* Companies with income, credit, or tax problems
* Companies that have filed for bankruptcy, but that stand to turn a profit
* Companies that are growing too rapidly for ready capital to keep up with business needs
* Companies poised to grow very soon but do not want to incur debt
* Companies that are growing rapidly, but do not have good enough credit to take out bank loans.
* Start-up companies with no capital base currently
* Companies with seasonal sales patterns or uneven sales patternsHenry Byers, Invoice Factoring advisor - focusing on Accounts Receivable Factoring and Factoring Financial Services

Invoice Factoring - How To Finance Business Growth Without Debts

2008-02-04T23:09:00.000-08:00

One of the biggest challenges that the owners of small and mid size businesses have is waiting 30 to 60 days to get paid on their invoices. Although large businesses can usually afford to wait, smaller businesses usually can?t. As a matter of fact, waiting to get paid on their invoices, usually affects the owners ability to meet payroll or pay the company?s bills. This problem can even be more frustrating if the business has a number of orders that it cannot fulfill because its cash is tied in unpaid invoices.

How can invoice factoring help you?

Invoice factoring, also known as accounts receivable factoring, is a financial tool that allows small business owners to capitalize on the power of their slow paying invoices. It allows you to turn your invoices into immediate cash, enabling you to fund your business operations. Although it is not a well-known fact, invoices from strong credit worthy commercial clients are excellent collateral, especially for factors. Although most banks won?t take it ? invoice factoring companies are more than willing to provide you with financing based on them. This makes factoring an ideal financing vehicle for small and mid size companies, as well as knowledge-based businesses and employee intensive businesses.

How does invoice factoring work?

As opposed to most banks than lend you money against collateral, invoice factoring companies buy your invoices outright. The factoring company buys your invoices and provides you with funds immediately, while they wait to get paid by your customers. Let me describe the transaction with an example:

1. Let?s say that you sell services to Company A and Company B. As soon as you provide them with services, you issue invoices.
2. At the same time, you send copies of the invoices to the factoring company, who buys them and provides you with an advance payment for them.
3. The factoring company waits to get paid by your customers. Once paid, any remaining funds, are sent back to your company.

The invoice factoring process can be repeated for every invoice that you issue, providing you with a flexible line of financing that grows with your business.

How much will an invoice factor advance my business?

The factoring transaction is commonly done as a two-installment sale. The first installment is called the advance and is paid to you as soon as you submit the invoices. Advances can range anywhere from 60% on the low end up to 90% of the gross value of the invoices. The average advance is about 75% (for the industry) The remaining installment, called the rebate, is remitted to you once the invoices are paid.

The cost of invoice factoring

The actual cost of an invoice factoring tramsaction is determined by three criteria. First, the credit worthiness of your customers. Second, the length of time your invoices take to get paid. Third, the monthly factored volume. Your cost, actually called a discount in the industry, can be as low as 1.5% or as high as 12%, per transaction.

How can I determine if invoice factoring will help me?

Generally speaking, invoice factoring will help you if you have a business that has reasonable profit margins or is growing quickly. Mid size companies with 20% or more of profit margins or large companies with 15% profit margins can usually do well with accounts receivable factoring.

Invoice Factoring Group - http://factoring.qlfs.com - can provide you with factoring quotes at no cost to you. Marco Terry, its president, can be reached at (786) 206 4722

"The Pros and Cons of Factoring" - Trade Receivables

2008-02-04T00:15:00.000-08:00

Factoring is a quick and easy way to replenish your business with urgently needed cash in quickest possible time. However, this financing option is not all hassle free and has its disadvantages too.

The pros and cons of factoring

Advantages:
- It is among the quickest way to get advance cash. ( http://www.hjventures.com/factoring/accounts-receivables.html )

- Overhead charges get automatically reduced with the cut in invoice processing activities.
- The business owner becomes free of various other obligations connected with the invoice processing like depositing checks and entering payments.
- Getting cash with factoring helps in eliminating the risks of bad debts.
- By undertaking the task of debt collection it helps the company in concentrating over more value added activities.
- Without acting as hindrance to cash flow it gives an opportunity to offer credit terms to customers.
- Factoring brings no extra liability in balance sheet and hence does not result in creating hassles while obtaining other types of financing.
- Early payment discount is another benefit of factoring. Payment of bills before the scheduled time brings in many benefits in the form of discounts.
- It is an easy way to have an access to unlimited capital as with an increase in sale more money becomes immediately available to business owners.
( http://www.hjventures.com/factoring/factoring.html )

Some other benefits include building credit, quick and easy process, concentration on marketing and securing new accounts and no long-term obligation.

Disadvantages:

- The biggest disadvantage is it makes the process complicated as it acts as an extra link in the process.
- It is useful for companies with disputes and queries.
- The ambit for borrowing gets narrowed, as account receivables will not be available for security.
- Factors may want to get your customers examined and may have influence over your ways of doing business.
- In case the customers do not repay the money, you have to pay their amount entwined in factoring.

- It is costly than other sources of finance though it is competitively priced.
- Few customers don't want to deal with a third party and are not interested in factoring.

Learn more about factoring / business finance: http://www.hjventures.com/factoring/factoring-glossary.html

Business Finance Expert Series: "The History of Factoring"

2008-02-01T23:02:00.000-08:00

In conventional times factoring ( http://www.hjventures.com/factoring/factoring-glossary.html ) is one of the most sought- after method to improve the cash flow ( http://www.hjventures.com/factoring/cash-flow.html ) of a company. When a firm decides to its account receivables to a financial institution then it is termed as factoring. The factor then bears the credit risk for the accounts and finally receives the sum from the customers. It is among one of the most effective and efficient form of financing used these days. Factoring has been in existence since the beginning of trade and commerce. It can be traced back to the period of a Mesopotamian king Hammurabi. However, an extensive use of the concept began in American colonies before the revolution started. During those times raw materials like timber, fur and cotton were shipped from the colonies and before they reached the destination merchant bankers in London and other parts of Europe used to advance funds for the raw material. The practice was very beneficial to the colonists, as they didn't have to wait for the money to begin their harvesting again. Basic work of factors of colonial times is similar to factors of conventional times. They have the same job of making advances against the account receivables ( http://www.hjventures.com/factoring/accounts-receivable-financing.html ) in order to help them in continuing with their job even before they are paid for their sale. With the Industrial Revolution the concept of factoring got narrowed down to credit. In the 60's and 70's with an escalation of interest rates there was a surge in private factors. The trend strengthened in 80's with further increase in interest rates and changes in the banking industry. With various expenses and inflexible rules involved with banking, factoring is a safe and easy method for financial expansion and growth. Working capital arranged through factoring is an easy means to cover purchasing, operating and other pay roll costs and provides the much-needed freedom from varied book keeping functions like credits and collections. All these attributes have made 'factoring' a buzzword in the financing market. Learn more about http://www.hjventures.com/factoring/factoring-glossary.html

Howard Schwartz is a partner in several business strategy groups, including HJ Ventures International, Inc. Howard has worked with hundreds of entrepreneurs worldwide with a focus on writing Business Plans for companies interested in raising capital from Venture Funds and Angel Investors. Howard's business plans have secured several million dollars in funding. For more information: http://www.hjventures.com/factoring/factoring-glossary.html

Growing Faster Than Your Cash Flow? Let Factoring Fund Your Next Expansion!

2008-01-31T00:27:00.001-08:00

Why wait weeks or months to get paid by your clients when you can access your money in a matter of days by factoring your invoices. When a business factors their invoices, they are allowing a third party to purchase their invoices at a discount price. This discount is considered the third partys fee.

If your business receives orders from customers on a regular basis, but has to wait 30, 60, or even 90 days for payment, you maybe experiencing a crunch in your cash flow. Factoring gives you the opportunity to access your cash within days not weeks or months. The growth of your company depends on whether or not you have the working capital necessary to finance your expansion.

When a factor purchases a companys invoice or invoices, no interest is ever charged. This is because factoring is considered an outright purchase. When a company sells their invoices to a factor, they can expect to receive an advance up to 90% or more of their accounts receivable. The business gets this money immediately and the factor makes a fee for this service, turning the transaction into a win-win situation for both parties.

Factoring is no longer a business tool used by the large Fortune 500 Companies. Small to midsize businesses are receiving tremendous benefits by implementing factoring as part of their financial strategies. If your business is growing at a faster rate than your cash flow, maybe its time to explore an alternative solution such as accounts receivable funding.

Marty Milan works with businesses to help them generate a continuous stream of cash flow without the occurrence of debt. In addition to accounts receivable funding, you can read on various topics such as lawsuit funding, structured settlements, selling your private mortgage notes and more at: www.cashflowaccess.com. Email at cashflowaccess@aol.com.

Other articles include: To Factor or Not to Factor?

Factoring Financial Services - The Basics

2008-01-29T00:20:00.000-08:00

There are several aspects of an existing business that are taken into consideration when getting approved for factoring financial services. The information that is required from any factoring financial servicing company will revolve around average invoice size. This is a huge contributing factor as well as whether the invoices are domestic or international. This means that the company seeking factoring services sells their service or goods outside the boundaries of the home country. The payment terms that were implemented for the invoices will also be considered in assessing the risk factor. The final aspect that any factoring financial services company will consider is the credit worthiness of the clientele base. All of these points together will give the company the opportunity to assess the risk associated with financing the invoices for any existing business.

There are basically two different types applications that are applied by factoring services companies. These are called the discount method and the prime plus method. Many companies use both of these methods of determining the cost that is charged to the client. Each financial situation is unique and most factoring financial services companies accommodate each business client according to their specific situation. With that said, in terms of very general speak, the prime plus method is usually the choice that produces lower rates than the discount method. This is an incredibly important step when finding a company that offers factoring services because many have hidden fees that are not mentioned initially. Find out exactly how each factoring financial services company regulates their factoring fees so there are no surprise fees added on at a later date.

To effectively understand the different methods used by factoring services companies, it is best to individually research each one. Let's start with the prime plus method to determine factoring financial services fees. The prime plus method has only two fees within its structure. The first part of the fee schedule is a one-time fee that is applied to every invoice. This is generally called the factoring fee. The factoring fees are assessed depending upon the gross amount of the invoice and applied accordingly. The second part of the prime plus method is the interest charge on the financial advance that the factoring services firm is providing. The day that the finances are made available to the business is the day that the interest begins. The interest rate is calculated by a pre-determined amount by the firm and the client before any financial advances are made.

The discount method that is applied to invoices by the factoring financial services firm's is based on a percentage per number of days. For example, if the discount method were 3% for the first 30 days, it would be calculated accordingly. It isn't hard to ascertain that the prime plus method is likely the better choice for any potential factoring services customer.

Troy Degarnham is the author and webmaster of http://www.accounts-receivable-financing.info an informative website about Invoice Factoring.

Extensive help and tips on factoring companies, assets, small business, medical factoring, non recourse and other factoring financial services.

Financing Legal Fees (Factoring)

2008-01-28T00:50:00.001-08:00

While most small and medium sizes law firms want to grow and prosper, few have the necessary working capital to handle increased case loads or extended settlement payment. Factoring, which is the purchase and sale of accounts receivable (in this case, legal fees) at a discount at or near the time of creation (settlement), can help solve this all too familiar cash flow problem.

Financial transactions with attorneys are shaped by ethics issues. The intrinsic problem is that the non-lawyer entity has an incentive to attempt to "maximize its earnings to the detriment of the representation of clients." However, once a case has settled, these issues are not in play any longer and the ethics issues go away. Legal fees on settled cases are just like any other account receivable and can be sold, assigned, factored or otherwise financed.

Specialty finance companies like CapTran (www.captran.com) will purchase legal fees on settled cases. Most companies will deal in all fifty states.

• Minimum Transactions amounts are as low as $5,000

• Individual fees can be aggregated to meet minimum

• Maximum Transactions amounts are generally in the millions as most factoring companies are very well capitalized

• A portion of a fee may be sold

• Generally, there are no application fees

• The fees must have no known motions or actions challenging the settlement

How it works

Once a case has settled and all documents have been properly executed by both plaintiff and defendant, the fee receivable is purchased for a small discount, usually between 2% and 12% depending on the payor and amount. The main difference in rates is the factor’s estimation of the time it will take to collect the fee.

Step 1 – Master Fee Purchase Agreement

A Master Fee Purchase Agreement is executed specifying the terms of the under which fees will be purchased, including minimum and maximum amounts, advance rates, fees and rebates. Before you begin factoring, please fax us the following documents:

• If your firm is a Proprietorship:

o Fictitious Business Name Statement or other document you filed with your local governmental agency allowing you to conduct business under your company name;

• If your firm is a Professional Corporation or Limited Liability Company (LLC):

o the document stamped by your state governmental agency confirming your company's registration and allowing you to conduct business under your company name. This is often known as a Charter or Articles;

• A copy of the declarations page of your malpractice insurance policy.

Step 2 – Submit Fee Purchase

Submission of fee for purchase using factor’s submission process/forms. (CapTran has an online e-from to make the process of submitting fees for purchase as easy as possible.) The documentation is simple and closing is usually within 24-48 hours.

Documentation:

• Copy of client fee agreement

• Copy of settlement or judgment

• Must be signed by defendant

• must be signed by insurance company or other payor

• Letter of instruction from attorney to payor directing payment to factor’s bank or lockbox.

Step 3 – Acceptance

Purchase of fees is subject to the factor’s acceptance,(acceptance occurs when you receive your advance), at their sole and absolute discretion at a the discount from face value agreed to in the Master Fee Purchase Agreement, which is usually wire transferred directly into your checking account. The discount will include the factor’s fee as well as any margin or “haircut” form the face value, which the factor has required. Usually, the factoring of legal fees requires no haircut if the payor is of unquestioned credit worthiness.

The assignment and letter of instructions from you is sent to the payor of the fee (usually an insurance company).

Step 4 – Payment

The payor sends their checks to the factor, which amounts are credited to your account, as received.

If the payor pays in a timely fashion (less than 90 days), you will also receive a Rebate when enough money has been collected to close any particular transaction. The Rebate is calculated by a predetermined formula that adjusts the original discount in Step 3. Here's an example assuming a 12.5% factoring fee and a rebate of 4.8% for payment within 90 days:

Amount of Fee $10,000

Less Advance Disocunt (12.5%) $1,250

Net Advanced to Attorney $8,750

Rebate if payment within 90 days (4.8%) $480

Net retained by attorney if paid within 90 days = $9,230

Net retained by attorney if paid after 90 days = $8,750

Every factor has its own rules, preferences and idiosyncrasies. However, the welcome mat in clearly out for accomplished small to medium sized law firms.

Some firms also offer working capital loans which may, for certain firms, compliment factoring very nicely.

Wayne C Walker, President of Capital Transaction Group Inc www.captran.com

Wayne C Walker, president of Capital Transaction Group Inc http://www.captran.com

The History of Invoice Factoring

2008-01-24T22:53:00.001-08:00

Factoring is one of the oldest business practices known. We know that it was used at least as long ago as the time of the Ancient Roman Empire, when merchants would enlist the help of collectors in order to settle trade debts. The primary reason for factoring’s long history is that it addresses a very fundamental problem in business itself: cash flow.

Let’s say you run a small company that’s developing a unique idea. Everyone works hard in designing the product, and your sales department hits pay dirt: a large manufacturing contract. This is exactly what you wanted, but you now have a problem: you need to hire more people and invest in some machinery to fulfill the contract, but you won’t see any money until the goods are delivered.

In this situation, a lot of your options aren’t too appealing – a large loan (assuming your business has the credit,) or convincing your employees to accept a deferred payroll. In many cases the best solution is to strike a deal with an invoice factoring company. What the factoring company will do is effectively buy your invoices at a discount - the “factor,” which are typically 3 - 4% - and provide you with the up front cash that you need. When they come due, the factoring company will then collect your invoices in full. Although the invoice factoring company will collect the receivables, this is usually done in a transparent way to the customer: as far as the customer is concerned, they are simply paying an invoice to a company as they normally would.

Even if it’s not out of a need for capital, many smaller businesses also turn to factoring companies to alleviate cash flow issues. When selling to large corporations, some businesses find themselves dealing with long gaps between invoicing and payment and with little leverage to narrow it. By turning to an invoice factoring company they can create a steadier cash flow.

The Beginnings: Invoice Factoring in Early America

Factoring made its way to America almost as soon as the pilgrims did. Many early American merchants made use of factors in order to sell tobacco and cotton abroad: they would ship their goods to England where a factor would take a percentage for selling and collecting money owed, and English merchants would do the same using American factors. In this way factoring played a pivotal role in rapid growth of American industry – without factors it would have been much more difficult for merchants to maintain a steady cash flow and trade of goods overseas.

As the American economy grew, American factors were able to concentrate more and more on domestic business. From the early colonial factors, and group of around 40 large factoring companies descended, based mostly on the east coast, that played a major role in financing the textile and transportation industries until the early 1950s. In the early part of the 20^th century these factoring companies began to establish percentages of receivables that they would advance companies upon the purchasing the invoices, usually around 70%-80%. This provided much of the large amounts of capital needed in these industries.

The mid 1950s saw the emergence of smaller businesses using factoring to address cash flow issues, moving the factoring industry away from the exclusive realm of large industry. As smaller businesses began to make use of factoring, the industry grew rapidly and became more competitive. The result was a trend towards mergers beginning in the 1970s that saw the number of large factoring companies reduced to around 10 by the end of the decade. At the same time, banks and other large financial institutions began to offer factoring services, and the business of factoring became the domain of large, institutional organizations.

The Impact of Invoice Factoring on Today’s Small Business Trends

The factoring industry more or less remained this way until fairly recently. The last 10 to 15 years has seen the re-emergence of small, independent factoring companies catering to a much wider range of businesses and needs. This trend has created a split market with a few mammoth factors targeting traditional factoring industries, and many small factoring companies that are continually creating new markets.

This trend towards newer, smaller invoice factoring companies is a reflection of contemporary business trends. The pace with which smaller companies develop and operate, particularly in the competitive technology and service sectors, requires a steady cash flow that can’t always be provided by receivables. An example of this can be seen in the emergence of temporary staffing agencies. These companies have large payrolls and depend heavily on cash flow. The competitive nature of this industry puts many temp agencies in a position where their payroll is due before their invoices are, and many smaller factoring companies have come about to provide solutions for this gap between payables and receivables.

David Springer is a consultant for Sovereign Funding Group. Sovereign Funding Group is an experienced, reputable company that offers convenient, no-risk services to help you with the selling of your deferred payments and business financing including invoice factoring.

Factoring. Cash Without Borrowing

2008-01-24T22:52:00.001-08:00

How to Increase Cash Flow Without Borrowing

Cash flow is one of the main reasons businesses fail. At one time or another, every business, even successful ones, have experienced poor cash flow. Cash flow does not have to be a problem any more. Do not be fooled -- banks are not the only places you can get funding. Other solutions are available and you do not have to borrow.

What is Factoring?

One solution is called factoring. Factoring is the process of selling accounts receivable to an investor rather than waiting to collect the money from the customer.

Oh, the Irony…

Factoring has an ironic distinction: It is the financial backbone of many of America's most successful businesses. Why is this ironic? Because factoring is not taught in business colleges, is seldom mentioned in business plans and is relatively unknown to the majority of American business people. Yet it is a financial process that frees up billions of dollars every year, enabling thousands of businesses to grow and prosper.

Factoring has been around for thousands of years. Factors are investors who pay cash for the right to receive the future payments on your invoices.

An unpaid receivable or invoice has value. It is a debt your customer has agreed to pay in the near future.

Factoring Principals

Although factoring deals exclusively with business-to-business transactions, a large percentage of the retail business uses a factoring principal. MasterCard, Visa, and American Express all use a form of factoring in their retail transactions. Using the purest definition of the word, these large consumer finance companies are really just large factors of consumer paper.

Think about it: You make a purchase at Sears and charge it to your MasterCard. The store gets paid almost immediately, even though you do not make payment until you are ready. For this service, the credit card company charges Sears a fee (typical fees range from two to four percent of the sale).

The Benefits

Factoring can offer many benefits to cash-hungry companies. Rather than wait 30, 60, 90 days or longer for payment on a product or service that has already been delivered, a business can factor (sell) its receivables for cash at a small discount off the amount of the invoice.

Payroll, marketing efforts, and working capital are just a few of the business needs that can be met with this instant cash.

Factoring provides the means for a manufacturer to replenish inventory and make more products to sell: There is no longer a need to wait for earlier sales to be paid. Factoring is not just a cash management tool for manufacturers: Almost any type of business can benefit from factoring.

Generally, a business that extends credit will have 10 to 20 percent of its annual sales tied up in accounts receivable at any given time. Think for a moment about how much money is tied up in 60 days' worth of invoices: You cannot pay the power bill or this week's payroll with a customer's invoice, but you can sell that invoice for the cash to meet those obligations.

Factoring is a fast and easy process. The factor buys the invoice at a discount, usually a few percentage points less than the face value of the invoice.

The Drawbacks

People consider the discount a small cost of doing business. A four-percent discount for a 30-day invoice is common. Compared with the problem of not having cash when you need it to operate, the four-percent discount is negligible. Look at the factor's discount as though your business had offered the customer a discount for paying cash. It works out the same.

Companies consider the discount the same way they treat a sales price: It is simply the cost of generating cash flow, much like discounting merchandise is the cost of generating sales.

Factoring is a cash flow tool used by a variety of businesses, not just those who are small or struggling. Many companies factor to reduce the overhead of their own accounting department. Others use factoring to generate cash, which can be used to expand marketing efforts and increase production.

Why Factoring Appeals to the Start-Up

Factoring is especially appealing to young and rapidly growing companies. Since the process shortens their business cycle, these businesses can grow faster. The ability to make more products to sell while waiting for invoices to be paid is largely eliminated. Such businesses usually net much more profit with factoring than without, even when the discount is considered.

Factoring vs. Bank Loans

So, why not simply go over to the friendly banker for a loan to alleviate cash flow problems? A loan can be difficult if not impossible to receive, especially for a young, high-growth operation, because bankers are not expected to decrease lending restrictions soon. The relationships between businesses and their bankers are not as strong or as dependable as they used to be.

The impact of a loan is much different than that of the factoring process on a business. A loan places a debt on your business balance sheet, which costs you interest. By contrast, factoring puts money in the bank without the creation of any obligation. Frequently, the factoring discount will be less than the current loan interest rate.

Loans are largely dependent on the borrower's financial soundness, whereas factoring is more interested in the soundness of the client's customers and not the client's business itself. This is a real plus for new businesses without established track records.

There are many situations where factoring can help a business meet its cash flow needs. It provides a continuing source of operating capital without incurring debt, which can result in growth opportunities that dramatically increase the bottom line. Virtually any business can benefit from factoring as part of its overall operating philosophy.

Every good businessperson must understand the concept and benefits of factoring in order to operate as profitably as possible. The following chart can help you understand the differences between factoring and other sources of funding.

For more information on factoring and other non-traditional ways to obtain funding, contact Fred Coutts at (206) 364-9613 or Fred@FredCoutts.com. Please visit my website at http://www.fredcoutts.com/index3.htm for more information on powerful funding programs without going through a bank

Since 1980, Fred Coutts has been crafting powerful cash flow solutions for businesses and individuals alike, from entreptreneurs to "Fortune 500" companies. He has built a solid foundation of financial and operational experience through many executive roles, including those as CFO and Controller. Fred is well versed and experienced in finance, accounting, and business operations.

Over the years Fred has developed relationships with funding connections nationwide, both traditional and non-traditional sources to help you meet your cash flow needs.

Professional Certifications:

---Certified in Public Accounting(CPA)

---Certified in Management Accounting(CMA)

Factoring Fundamentals - Vendor Financing

2008-01-23T01:37:00.000-08:00

Factoring is an efficient and reliable way of meeting capital needs of the business. It is beneficial when a business promises to have definite profits in future but faces capital deficit to get the project completed.

Factoring Fundamentals: Principles that govern factoring are same as those governing bank loans, credit cards and other such lending methods. The basics of factoring are divided into two main practices. When a factor purchases an estimated value of the future account receivables it is known as non-recourse factor practice. In non-recourse factoring the factor bears the bad debt risk and the business owner is required to pay interest to the factor for the period specified in the factoring agreement.

The second full-recourse factor practice involves the use of invoice as a security to make a loan. In recourse factoring the factor has recourse to business owner if the concerned customers do not pay. Recourse factoring is cheaper than non-recourse factoring.

How does factoring work?

The first step in the process is to fill the documents provided by the factor and when they get completed the factor provides the business owner with cash against receivables. The factor then pays the business owner a certain percentage of the total value of your invoices. This can be up to 90% of the total value of the invoices. This is paid as soon as the invoices are received, or at the time agreed upon between the business owner and the factor. The process normally takes 24 hours to complete and is either sent directly to business owner’s account or through the mail. Once customers pay up the bills at pre-determined dates lenders too pay up the remaining amount. In the end business owner will also receive copies of customer checks on the date of receipt to keep a record.

( http://www.hjventures.com/factoring/accounts-receivables.html )

Factoring fundamentals once confirmed and acknowledged, are a step towards a stable and secure business, as they help in keeping the working capital needs of the company on track.

Learn more about factoring / business finance : http://www.hjventures.com/factoring/factoring-glossary.html

Howard Schwartz is a partner in several business strategy groups, including HJ Ventures International, Inc. Howard has worked with hundreds of entrepreneurs worldwide with a focus on writing Business Plans for companies interested in raising capital from Venture Funds and Angel Investors. Howard’s business plans have secured several million dollars in funding. For more information: http://www.hjventures.com/factoring/factoring-glossary.html

Use Invoice Factoring to Succeed

2008-01-18T23:24:00.001-08:00

Factoring is an accounts receivable financing strategy for businesses to sell accounts receivable at a discount to get cash needed for business growth and development. By factoring the value of the accounts receivable, the business is able to increase the speed of cash flow.

The business can use a factoring company to obtain cash equal to the value of the accounts receivable minus a factor's fee. This process can also be referred to as invoice factoring.

When factoring an invoice, three parties are affected by the process, the seller who owns the invoice, the debtor who owes the balance on the invoice and the factor or factoring company who will buy the invoice.

There are several types of factoring.

Full service factoring involves notifying the debtors who owe the balance. The factoring company controls the credit as they collect the outstanding debts.

Invoice finance allows the seller to keep the credit control function so the factoring company is undisclosed to the debtor.

Recourse factoring is the most common type of factoring. In this case the seller continues to be at risk as the seller must buy back the invoice if the debtor does not pay within a specified time frame. This is the lowest cost option for the seller because of the risk involved.

Non recourse factoring puts the risk of non-payment completely on the factor who purchases the invoice. If the debtor fails to pay, the factor cannot attempt to receive payment from the seller. As a result the factor will often turn away customers with only average quality of credit. The cost of this type factoring is higher since all the risk is on the factor.

New company factoring.

Factoring is ideal for a new company to get financing since often when new, banks are more resistant to making loans to a company. By selling accounts to a factor (or finance company) the company can gain immediate cash based on what its customers owe. In this case the company would send the bills to the factoring company for payment rather than to the customers themselves, eliminating the wait for the billing cycle to complete.

Caution regarding factoring.

Factoring is an expensive source of funds and is only recommended when a company is growing faster than their current funds can handle. It should be used more as a last resort than as a first solution. Factoring can be a huge benefit during rapid growth or difficulty so focus can be on solutions and processes rather than on concerns for keeping bills and payroll paid in a timely manner.

To offset the cost of factoring, have customers pay higher percentage points to receive flexible terms. Give a large cash discount to customers or clients who make cash payments at the time of purchase. This way covering the cost of factoring can be turned into a benefit for both the customer and the supplying company.

Janie Jenkins is the "Easy To Do" instruction expert. Discover how easy it is to do what seemed like your most complicated ambition.More About Factoring

Factoring is Good for Business

2008-01-18T00:37:00.001-08:00

It seems you can never have enough money, and factoring is just one more way to meet that goal. The basic premise behind the business idea of factoring is that an owner sells his accounts receivable to get a quick influx of cash. The buyer gets the accounts receivable at less than their actual value. The pay off comes when the accounts are paid in full.

Factoring can be good for the business owner. The sell gives the owner some immediate working capital that would have trickled in otherwise. It also takes the hassle of collecting outstanding accounts out of the hands of the owner. The down side to factoring is that the owner will get less money for the accounts than they show on paper.

Most owners who look to factoring are trying to find a way to smooth out the cash flow and free up time. It basically comes down to a need for having the money now instead of later. The money is guaranteed at the sell of the accounts, and the business owner doesn’t have to spend time and resources trying to collect on accounts. Factoring also relieves the owner of concerns about bad debts. Collection is strictly in the hands of the buyer.

The buyer side of the factoring benefits because the accounts are purchased as much as 25% below their face value. This is a nice profit on a short term investment. It is also likely that a company interested in factoring has streamlined the collection process – making the process much more cost effective.

Factoring is not for every company, nor every investor. The best route for factoring is to find a company that specializes in this investment process and develop a relationship with it. It would also be wise to consult with an accountant to see if the process of factoring could be a money saving tool for your business.

Kathryn is a freelance journalist covering business and finance issues, specializing in subjects such as factoring and ecommerce.

Accounts Receivable Factoring Basics

2008-01-18T00:36:00.000-08:00

Invoice Factoring Group

Invoice Factoring Group is a factoring company that can provide you with a free accounts receivable factoring or receivables factoring quote. Marco Terry, the president, can be reached at (866) 730 1922.