| Are you selling goods or services and waiting | | | | advance on your slow paying invoices - |
| up to 60 days to get paid? Learn how | | | | sometimes up to 85% of what you have |
| factoring receivables can help your business | | | | invoiced. You can use the advance as working |
| grow. | | | | capital to cover new sales orders, payroll or |
| | | | supplier payments. Factoring receivables |
| If you sell goods/services to other | | | | provides you with relief form slow payments |
| businesses or to the government, then you | | | | and provides you with the working capital you |
| know that commonly you have to wait 30 to 60 | | | | need to grow. Factoring receivables is simple |
| days to get paid for your services. Unless | | | | to use and works as follows: |
| your business is well capitalized, waiting to | | | | |
| get paid can drain your working capital and | | | | 1. You provide the product/service to your |
| affect your business. Lack of working capital | | | | client and send an invoice to them |
| can prevent you from making new sales, | | | | |
| forcing you to sentd customers to your | | | | 2. You send a copy of the invoice to the |
| competition. What is worse, if the problem is | | | | factoring company |
| not corrected, it can affect you ability to | | | | |
| pay employees or suppliers. Missing payroll | | | | 3. The factoring company advances you up to |
| and supplier payments is a sure indication | | | | 85%. This is your first installment |
| that a business is in serious financial | | | | |
| troubles. The solution to this problem is, of | | | | 4. Once your client pays, the remaining 15% |
| course, simple. You just need to get business | | | | (second installment) is advanced, less a |
| financing. Obtaining business financing (such | | | | small service fee |
| as a line of credit or business loan) is | | | | |
| easier said than done. If you go to a bank, | | | | The fee you pay will be based on the sales |
| they will require that you provide them with | | | | volume that you finance and the credit |
| three years audited financials and a solid | | | | quality of your clients. Fees can generally |
| business plan. That kills any chances of | | | | range from 1.5% to 3.5% per month. On of the |
| financing for most startups and new | | | | big advantages of factoring receivables is |
| businesses. There is, however, an alternative | | | | that it is easy to obtain and can be set up |
| form of financing that can help you get | | | | in a few days. Most new and established |
| working capital. And, it almost always works | | | | businesses can qualify easily. The biggest |
| better than a business loan. It is called | | | | requirement to qualify is that you must do |
| factoring financing. Invoice factoring | | | | business with reputable clients or government |
| provides your business with a substantial | | | | entities. |