Temporary staffing agencies are always battling the gap. What gap, you ask? It’s a virtual gap that exists between the need to pay their employees on time, and the payments from their clients. Factoring companies fill this gap by offering them funding. They provide the staffing agencies the cash they need based on the money they expect from their clients.
Factors enable the temp agencies to run their businesses, even despite clients may not pay until up to 90 days.Some factoring companies will immediately offer quick funding to staffing agencies; other companies need to build trust. In these cases, initial funding would be a bit slow…but factoring companies are still a better option than applying for loans and awaiting processing.
Advantages of Factoring Companies as Funding Sources for Temporary Staffing Agencies
- Ensures constant revenue.
- Assists the staffing agency in paying and retaining its employees; employees do not stay at staffing agencies that do not pay on time.
- Enables the staffing agency to access money earned before they’d normally receive it.
- Cash advances are based on the client’s credit history, not the staffing agency’s – factoring companies eliminate the need for concerns of clients’ ability to pay.
- No debt is added to the staffing agency because the clients pay for the advances; this leaves the staffing company with no stress on future repayment of debts, and if the interest goes beyond the amount, the client is responsible.
- The factoring company collects the payments and provides the checks.
- Enhances growth of the staffing agencies by ensuring their businesses run as usual.
Find a factoring company that specializes in temporary staffing. They will better understand your challenges and offer good support. A good factoring company will help you manage payments to your staff by offering payroll checks and reports.
When choosing a factoring company, inquire about all charges and fees; be sure to select a one with an exemplary track record.
Benefits of a Good Factoring Company for Funding Your Staffing Agency
- A Steady Source of Capital– If the factoring company is reputable, they will give you good advancements which serve as capital for your staffing agency business.
- Quick Advancements–The advancements should get to you within a very short time, so that you are able to pay employees, and cover other expenses, such as rent.
- Extra Services – Not all factoring companies offer extra services, such as payroll management and collections. If you select an established, reputable factoring company, you will undoubtedly be able to enjoy these extra services.
- Growth – A good factoring company helps and supports you to see that your staffing agency is making progress.
Invoice factoring is a good funding source for most staffing agencies. Take your time, do your research, and find a good source of funding for the continued growth and success of your business. If you have questions, contact Carter Funding today!
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