Posted by Phineas Gray , on May, 2015
When you are in business as a small business owner, a startup, or an entrepreneur, opportunities can come along at unexpected times. Having the working capital and resources to be able to take advantage of an opportunity for growth into a new market can be the difference between future success and shutting the doors on a business.
By using factored receivables, a small business can take full advantage of current B2B (business to business) accounts that are valid but pending payment. As a factoring company we will purchase the accounts receivables (AR), providing your business with the working capital it needs when you need it.
The Process Involved
Unlike some funding sources, the process of using factored receivables to generate working capital is very straightforward and easy.
It starts with an online application through our website, which will include a statement of validity and information about the accounts receivables you wish to sell. After a review of the application, the small business will be notified of approval, typically within 24 hours or less. Funding will follow in three to five business days, providing the business with the B2B accounts receivable as the collateral.
Top factoring companies can provide very good rates on the factored receivables. Often rates are 80% or more of the value of the accounts receivables as the initial funding. The specific fees charged by the factoring company will be made available at the time of the proposal. (you might want to add another sentence that uses the works accounts receivables)The factor will then collect from –your customer, providing the additional balance of the factored receivables to you, the client, as per the factoring agreement. This frees you up to work on expanding your business, obtaining new contracts, seeking out new markets and managing the daily juggling act of owning your own business.
The funds obtained through the factoring firm can be used just as you would any working capital. Many small business owners use them to buy materials and supplies, boost inventory or manage payroll. It can also be used to hire new employees, bring in consultants and otherwise expand and grow your business.
Taking advantage of the opportunities offered through accounts receivables factoring is a sign of a savvy, progressive-thinking business professional. Working with a top-factoring firm is a business partnership, which will continue to provide your small business with the working capital it needs to take advantage of opportunities when they are available.