Security staffing companies often have problems when it comes to closing the cash flow gap. This is mostly because such enterprises provide services on credit terms that are flexible. Even though this helps in building long-term working relationships with their clients, it negatively impacts the provider’s performance.
Most of the time, security staffing may not be able to expand their businesses, meet payroll expenses, and augment overhead because of their credit policies. Also, start-ups might lack sufficient capital to complete certain projects. This is usually a big problem since the contracting company may be unable to pay at the right time.
How Invoice Factoring Can Work for Your Security Staffing Service
Fortunately, there is a way out of this situation! Security Staffing Factoring is a feasible option. You can finance your invoices through this method, using them as a basis for getting advance funds. It’s not complicated to get an approval. After that, you can receive up to 90 percent of the value of your invoice quickly, and get the remaining amount later.
Advantages of Invoice Factoring
Choosing factoring services allows you to access a total business support. The system does more than just rejuvenating your working capital. Here are some other benefits that factoring services can offer you:
- Quick and Easy Approval. To process a conventional loan, it would take a lengthy period of time that might cause delays if you have an urgent matter to address. It requires proof of profitability, long-term contracts, or tax returns. With invoice factoring, you can receive funding in as little as 24 hours. Some factors delay a bit in transferring the cash but charge a lower fee for that. However, it depends on your choice.
- Competitive Rates. Factoring offers you a 100 percent debt-free business funding that requires no repayment. You only incur as low as 1 percent fee on all your invoices after the clients pay.
- Poor Credit Is Not A Problem. If you have a startup business or one that is struggling and needs rejuvenation, then you’re a candidate for factoring. The basing of the factor’s funding decisions on your clients’ creditworthiness rather than yours is a great advantage. In fact, even if your credit score is way below the ideal, the company can still approve the application.
- Unlimited Funding. How much is your invoice value? The factoring company can fund you for the whole amount. It just depends on the unpaid projects that you’ve already completed. Depending on your factor, some companies offer customized factoring packages that go up to $10 million.
- No Strings Attached to the Funding. Use the cash that you receive to build your company without limitations or restrictions from the factoring company. Meet your payroll expenses. Increase your business’ liquidity. Penetrate into newer markets. Pay operating expenses without straining. Hire more staff. Augment overhead. Grow your business… The list is endless.
- Control Over Operating Your Costs. With a standard fee and no up-front costs, it’s easy to account for the factoring cost on the balance sheet. You have the flexibility of asking for different amounts of funding at whatever time of the year. Therefore, by submitting the invoices only when you need to, it’s easier to control your costs.
- Negotiation Window. It is possible to negotiate early payment incentives and discounts with your creditors since you can easily access a working capital.
- Save Time and Money. The process of checking credit and collecting payments is usually time-consuming and costly. With the factoring company taking that load off of your back, you can concentrate on the other important areas of your business.
What to Consider in Choosing a Security Staffing Factoring Company
Working with a factoring company can be challenging if you do not know the qualities to go for. Especially, the process involves sharing some confidential account information. Therefore, you don’t want to work with just anyone. Before you choose a factoring company, consider the following:
- Excellent Customer Care. Some companies assign their customers a dedicated accounting manager who works with the service provider to provide the best offers. Just that they have given you someone to work with doesn’t mean you’ll receive great services. Always research the company’s reputation through customer reviews.
- Privacy. This is perhaps one of the most important things in dealing with a factoring company. Work with a factor that is professional and reputable for keeping customer information private and confidential.
- Expertise. It’s important to deal with a factor that has done business with B2B, B2C, and B2G service providers for at least 10 years.
- Quick Services. Work with those factoring companies that process applications within 24 hours.
- Cost. Look for companies that can give you an advance of about 90 percent and charge a standard fee of about 1 percent.