Receivables Financing and Your Business

by Kevin Smith Author

You've heard the story of the small bakery business that needed money for a large repair. Or the medium-sized jewelry business that outgrew their current space and needed to find a new one quickly before their lease was up. Or the small bus company that needed to repave their parking lot. Every day, many small and medium-sized businesses face the risk of failure due to a large, unexpected expense or even on they expected but just didn't make enough money to cover. How can financing receivables in Columbus, GA help companies like this stay on their feet while making the needed changes to continue to operate? By working with you to get your money faster while you wait for payment.

How Does It Work?

Often, your customers want payment terms of 30, 60 or 90 days. Of course, you give it to them because often they're repeat customers or ones with solid reputations in the community, so you know they'll pay it. But in the meantime, you're stuck without the cash on hand. That's where receivables financing comes in. Receivables financing works by basically providing your business a cash advance on it's receivables, so you don't have to wait for that customer to pay. You would provide the service to your customer as usual, so there's no interruption for them and the quality of your work remains. A third-party company would then provide you a percentage of the outstanding invoice amount while you wait for the invoice to be paid. Once the invoice is paid, the company takes a small fee out for their service and gives you back the rest. So you've had the money and been able to use it for what you need up front, and you still get most of the remainder of the payment once completed.

How Does It Help?

When you're not waiting for invoices to be paid to get cash, you're able to do things quicker and more efficiently than you would otherwise. If you have the funds up front, you're able to take on more business quickly, which contributes positively to your bottom line. When you're able to increase your workload, you have more outstanding invoices, which also provides you the opportunity to finance more receivables and continue to stay far ahead of the curve and build your business quicker. Financing receivables in Columbus, GA is a great way to increase cash quicker, thus more quickly building your business and your brand in the local community.