How to Reap the Rewards of Receivables Financingby Johnalex alex Writing Extending credit terms to clients can make you look for funding solutions especially when you believe that it’s not good for your business if you ask the clients to pay before the due date. Nevertheless, when you look for solutions, everyone would advise you to opt for receivables financing or invoice factoring especially if you have some invoices to sell. Interestingly, you can reap the rewards of this funding solution only when the company you are dealing with offers a fast, professional, and efficient service. Furthermore, you can only use factoring to your advantage if the funds come your way at the earliest.
Insist on early approval
Companies that factor receivables are supposed to be better than banks when it comes to approving your application because you won’t expect the former to take much time. So, make sure that whichever company you choose, they offer a quick turnaround of application, thereby making it clear that they would also be releasing the funds as soon as possible. Furthermore, when you get an early approval, you can make plans for utilizing the funds for your immediate requirements such as replenishing the inventory. The good news is that a reliable company won’t require more than 24 hours to decide if they are willing to approve your application.
Read between the lines
While your application for receivables financing should be approved within no time, you would only benefit if you are offered a high advance rate. In other words, when you sell your invoices, you should get as much as 85% especially if you are supposed to take care of some big expenses such as buying new equipment. Furthermore, it is imperative for you to find out the fees that you have to pay to avail the services of the factoring company. Of course, the fees should be as low as possible. Last but not least, the company should be in the favor of factoring small invoices as well.
Tell all about your business
Receivables financing is likely to hold the key to buying new equipment, replenishing inventory, or meeting payroll expenses because it can alleviate your funding issues. After for all this to happen, you have to ensure that the factoring company knows everything they should. That’s because if they are aware of your credit history, your past bankruptcies, and your tax problems, they can offer they can certainly help you in making the most of invoice factoring. Furthermore, they can discuss your problems with the concerned authorities, thereby making it easier for you to run your business smoothly.
Created on Mar 25th 2013 06:04. Viewed 202 times.
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