A/R financing is also referred to as invoice financing. It offers a great solution for business that may be in need of more funding that may be unavailable from traditional lenders. Most firms do require extra cash flow in order to support the seasonal demands, business opportunities, growth or solve a short-term cash requirement. Through accounts receivable financing, your business is provided with flexible and immediate cash.
Given the many benefits provided by A/R financing, this option has gained a very steady popularity over the past years. The benefits posed by this funding are very attractive that it will be unwise to resist this measure. This measure boosts up the credit rating as well as the financial profile of your company. Other advantages that are obtained through receivables funding constitute of:
Quicker cash flow. Financing your business through this mode provides an immediate opportunity of changing the credit sales into cash flow. By obtaining outstanding receivables that are monetized through commercial funding firm, you enter into a position whereby you can get money any time you need it badly. This saves time that would otherwise have been spent waiting for several weeks for a client to make his payments.
Focus on the business. Getting a hustle-free working capital relieves up your resources consequently giving you peace of mind. This enables you to turn your energies on other business activities that are more profitable like selling and marketing. The time that would be invested in collecting payments from unsympathetic clients becomes devoted to cementing your business.
More user friendly. Any type of business, large, medium or small can opt for A/R funding. Setting up the accounts receivable factoring lines takes just some few days. Unlike the conventional bank loans, you will not make payments or create a debt. Moreover, you are free to finance as much or as little as you wish.
Additional services offered. Many funding companies offer necessary aid in managing all your accounts receivables portfolio. These constitute of posting, invoice processing and reporting. A business owner consequently gains more time to attend to those activities that generate revenue. In many instances, factoring companies help to know the credit rating of customers before you make actual sales to them.
The firm checks on the payment history of a potential client before it signs him up. By doing so, you reduce the prospect of a bad debt by a significant margin, and you start dealing with clients who have a reputable track records. Instances of getting into a financial crisis such as bankruptcy are eliminated.
Given the many benefits provided by A/R financing, this option has gained a very steady popularity over the past years. The benefits posed by this funding are very attractive that it will be unwise to resist this measure. This measure boosts up the credit rating as well as the financial profile of your company. Other advantages that are obtained through receivables funding constitute of:
Quicker cash flow. Financing your business through this mode provides an immediate opportunity of changing the credit sales into cash flow. By obtaining outstanding receivables that are monetized through commercial funding firm, you enter into a position whereby you can get money any time you need it badly. This saves time that would otherwise have been spent waiting for several weeks for a client to make his payments.
Focus on the business. Getting a hustle-free working capital relieves up your resources consequently giving you peace of mind. This enables you to turn your energies on other business activities that are more profitable like selling and marketing. The time that would be invested in collecting payments from unsympathetic clients becomes devoted to cementing your business.
More user friendly. Any type of business, large, medium or small can opt for A/R funding. Setting up the accounts receivable factoring lines takes just some few days. Unlike the conventional bank loans, you will not make payments or create a debt. Moreover, you are free to finance as much or as little as you wish.
Additional services offered. Many funding companies offer necessary aid in managing all your accounts receivables portfolio. These constitute of posting, invoice processing and reporting. A business owner consequently gains more time to attend to those activities that generate revenue. In many instances, factoring companies help to know the credit rating of customers before you make actual sales to them.
The firm checks on the payment history of a potential client before it signs him up. By doing so, you reduce the prospect of a bad debt by a significant margin, and you start dealing with clients who have a reputable track records. Instances of getting into a financial crisis such as bankruptcy are eliminated.
About the Author:
Connor G. Schiffman has 27 years of experience in commercial lending including factoring, asset based lending, and banking. Connor helps readers manuver through all the account receivable options providing practical and useful knowledge to better understand all your lending options. If you want to learn more about Accounts Receivable Factoring Company he recommends you check out www.receivablefactoring.net.
No comments:
Post a Comment