Help Your Business Thrive with Receivable Financing

Accounts receivable financing

Help Your Business Thrive with Receivable Financing

15:29 01 August in Articles, Blog, Business Financing
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Your vendors, employees, or landlord are unlikely to wait until your customers pay their invoices to get paid. Business owners who are just starting up, have just made an investment in new equipment, or are in the process of attracting new customers all have one thing in common: they need cash.

When Input and Output Collide

There is little doubt you need cash to keep your business operational. You must be able to hire additional staff members, invest in equipment, and make sure you deliver product to your customers on time. These matters require available cash; unfortunately, most business owners do not have a ready supply of cash when they need it most. This is why today, more business owners than ever before are turning to accounts receivable financing; better known as factoring.

Benefits of Accounts Receivable Financing

Cash — nearly immediate cash is the most significant benefit you will gain when you factor your receivables. Readily available cash can prepare you to land a new customer, pay your current debts, or help you expand your business. Receivables financing is a much different option than bank financing; specifically, it is faster, and depends on your client’s credit rating rather than yours.

Improved Options for Business Growth

Many business owners believe if they intend to use accounts receivable financing, they must do so with all invoices. This is inaccurate; there is a method called “spot factoring“, allowing businesses to get cash against specific invoices any time they need an influx of working capital. It is also important to note that while typical bank financing may have strings attached, telling you, a business owner, how you can spend the money they loan you. There is no such restriction with factoring; you can use the cash anyway you deem appropriate to ensure your business stays operational.

Avoiding Month to Month Money Crunches

Too much month left at the end of the money? Need to pay your business invoices, or employees? Chances are, you have customers who have not paid their invoices; many times, you have offered 30-day payment plans and they use every single day. This may work well for your customer, but it may not work as well for you. This is why spot factoring may be the answer to your problems. You can get nearly immediate cash when you spot factor; in most cases, you can get cash within 24 to 48 hours of submitting an approved invoice.

Time For Growth? Get Cash Fast

Expanding a business can be very exciting; the problem is it is often costly. Too many business owners must often decide between paying their regular bills, and growing their business. Our goal is to make sure you have the capital you need to expand your business. Whether it is time to hire new staff members, invest in new equipment, or you have a new client who has placed a large order, you may be suffering a cash crunch. We know you cannot wait until your customer invoices are paid, the opportunity could slip through your fingers. This is why spot factoring, or regular invoice factoring could be the answer for your business.

Invoice Factoring Versus Bank Financing

One of the biggest challenges business owners face is establishing a line of credit with a local bank. This is because banks often have lengthy applications, stringent credit requirements, and want businesses to have an established track record before making a loan. We often are told by small businesses that banks only want to help them when they least need the money.

Borrowing money from a bank often means onerous terms. You may face prepayment penalties if you are doing well and want to pay ahead, your bank may dictate how the proceeds from the loan will be spent, and you may have to provide a personal guarantee. Most of these issues can be avoided by factoring your invoices; whether you want to factor the invoices of one client, or every client, we can customize a solution to meet your specific business needs.

When there is forward momentum that means growth for your company, you need to maintain that momentum. This is why Capstone may be the answer to your financing needs. We work quickly, and we offer a range of business financing options, Contact Capstone Business Funding, LLC today and learn more about how we can help you grow your business.

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