Keeping Up With Invoice Factoring

There are a multitude of companies that provide invoice factoring or spot factoring to small businesses. This is an effective strategy that Jim Rubbinacio explains to help businesses that are in need of financing and how invoice factoring helps to meet businesses' cash flow needs. 

The Cash Flow Secret 

Ask many people about invoice factoring and chances are they will not be able to tell you how it works.  Truth is, factoring is a simple answer to increasing cash flow but is still somewhat of a secret, and more companies should be aware of the benefits of factoring their invoices to improve cash flow.

How invoice factoring works, and how it can benefit you

Invoice factoring, also known as accounts receivable factoring, is a form of working capital financing for businesses selling goods and services to other businesses on credit. By “selling” their invoices to a factoring company, a business has access to instant cash, professional accounts receivable management, and up to date credit information. 

Who Can Use Invoice Factoring?

Any B2B business selling its products and/or services on credit terms (i.e. net 15, 30, 60, etc.). Business can be early stage start ups or tenured entities with annual revenues up to $60 million.  

Cash Flow Challenges For A Small Business Owner 

Our client shares his story on how invoice factoring helped his company during cash flow challenges.

Accounts Receivable Financing  

It is not uncommon for some businesses to get a little short on cash from time to time due to seasonal slumps, and other slow sale situations. Seeking bank financing is often a traditional solution, but if you know you have some clients who are going to be paying soon, then you may not want to take on the extra responsibility or payment obligation that comes with taking out a small business loan.

In cases such as this, accounts receivable financing may prove to be a worthwhile alternative.

In today's economic environment, businesses are finding it difficult to handle day-to-day operations of their practices while also keeping tabs on their accounts receivable. Whenever the economy takes a downturn, clients tend to fall behind in payments they owe. This disrupts the operation of the business, obviously. If you're a business owner and your clients are slow to pay you, this can put you behind the eight ball in terms of paying your own staff and paying vendors.

How Invoice Factoring Works 

Cash Flow Solution