How Factoring Companies Can Help Staffing Companies Grow

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

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

Factoring Receivables - Working Capital For Growing Businesses

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

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

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

How Freight Factoring Can Help Trucking and Logistics Companies

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

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

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

Invoive Factoring Company: factor receivables, account receivables

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.

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

Invoice Factoring: An Effective Alternative for Small Businesses

?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

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.

Accounts Receivable Factoring - An Exciting Alternative to Business Loans

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

Overcoming the Myths of Receivables Factoring

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.

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

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

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

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.

 

Top 5 Factoring Companies

Because factoring is such an obscure function of small business, despite its popularity within the business world, it can be difficult to find the right factoring company to help you out. Getting the right bid, the right terms, and having the cash flow through your business seamlessly is a big deal if you want to concentrate on the big picture. As you probably know, the internet is a wealth of information for small business owners. With that in mind, consider the top 5 factoring companies you can find online.

The first of the top 5 factoring companies you can find online is a site called FactorBids.com. This site is good in that it allows you to submit an application that will result in about a dozen factors bidding on your application. You will get a response in about 3 business days. The site is very professional looking and is very user friendly. Like many other sites that allow financial institutes to bid on business, everything is negotiable with this. A factor can change its bid or even cancel the deal completely, but then again so can you with this site.

The second of the top 5 factoring companies online is getfactored.com. At this fast and user friendly website you will be able to get quotes from up to four factors with just one application. That saves you time, which is a hot commodity for small business owners. This site also has a sister site, FreightCash.com, that specializes in factoring for trucking business, so that is something to keep in mind as well.

In the top 5 factoring companies, the third site to consider is Factors.com. Despite having sponsors on the site, it does offer you a great deal of information. The site is essentially a directory of companies by the industry they serve. You simply find your industry and will then have access to a number of factoring companies that specialize in businesses with needs just like yours.

Fourth is cfa.com, the site for the commercial finance associate. As factoring companies go, this one will help you narrow your choices down to factors who are CFA members. That means they are reputable and safe for you and your business. The site is a little cumbersome, but the information is good and you will be able to find a factor that can help you quickly.

Fifth on the top 5 factoring companies is another information site that will lead you to reputable factors. Factoring.org is the home of the international factoring association (IFA). The site is great if you are informed about factoring, but there is not a lot of information for beginners. Since IFA members are bound by a code of ethics, you know the lenders on the site are going to be easy to work with.

Finding a factoring company can be hard. However, these five factoring companies will help you find the right factor to help with the financial side of your business. Each is worth your time and with just a few minutes of research you will find which of these top 5 factoring companies on the internet can help you find the right factor for you..

Stu Pearson has an interest in Finance & Business and Factoring Companies, for more FREE information and articles please visit Factoring Companies Resources