We live in a tremendously dynamic economic environment and it’s important to manage operations in a swift and comprehensive manner.
Unfortunately, as an owner of a small business, you could easily come across a situation in which your customer has failed to pay you on time into a regular, quick-pay solution. Thanks to invoice factoring, this is not only possible, it’s already happening. It is great for entrepreneurs who have customers who fail to pay on time or pay at a later day and those same business owners need this capital to quickly grow and operate their business. Of course, there are quite a few things that you ought to consider when it comes to this particular financial instrument, so let’s take a look.
What is invoice factoring?
Let’s start with the basics. This is a small business funding opportunity which is technically a lot different than a regular loan. Instead of loaning money, you would be selling your invoices for a price which is discounted to a third-party factoring company in order to get a lump amount of cash in exchange.
This particular factoring company would afterwards own the invoice and it would get paid as soon as it manages to collect from your customer. This usually takes them between 30 and 90 days.
So, let’s go ahead and have a quick example. You own an IT company and you’ve sold your services to another company for $20,000. Your customer has agreed to pay this amount in the next month but you would need the money in the next week in order to get your employees paid up. Obviously, you would have a shortfall in terms of cash.
You could always turn to a regular bank and get small business bank funding but it would put interest on the money you’ve loaned, require collateral and it’s always associated with the risk of default. Even if you ado qualify for the bank loan and you are not afraid of the aforementioned risks, you might not get the money on time.
This is why you ought to turn to an invoice factoring company such as Carter Funding Corporation. It would agree to buy your invoice for a certain amount of money, which is usually the difference between the initial amount and their factoring fee which typically ranges between 1% and 5%. So, in the light of the aforementioned example, if you get 1% fee and 85% advance on your payment, you’d receive 85% of $19,800 in advance and the remaining 12% once the company gets paid. The entire thing is going to cost you 3% in terms of fees and that’s what you need to account for.
Is it a Good Small Business Funding Opportunity?
This is a quick answer – yes, it is. There are a lot of advantages that stem from invoice factoring and that’s why it’s becoming so popular. Right off the bat, you will be given a quick working capital which is going to bridge the gap caused by customers who pay slowly.
At the same time, you would be able to keep your loyal customers who pay on longer payment terms yet improve your cash flow and leave it undisrupted in order to conveniently grow your business.
Additionally, invoice factoring provides quick small business funding opportunities to those companies who haven’t manage to get a capital from other sources. It could conveniently replace any other lending opportunity because it gets rid of the added risk of default and loss of warranties and collateral.
Carter Funding Corporation
The Carter Funding Corporation has been in this field for the last 23 years. Since 1994 it has been providing its clients with convenient solutions to their financial hurdles.
With tremendous flexibility and dynamic working conditions, the company offers serious advantages and it is ready to be your reliable partner when it comes to small business funding opportunities. With factoring fees as low as 1% and advanced payments on your outstanding invoices of as much as 90%, you can easily get rid of your problems and make sure that you have the necessary operating capital to handle everything flawlessly.
This is something that you should most definitely take into consideration. You need to be able to rely on the company that you are working with in order to ensure that everything is handled as per the highest industry standards. With this in mind, CFC is a company which is capable of going the extra mile with you. Offering high-end services tailored to fit your needs in terms of both time and amount, you can easily get the necessary dynamic in your cash flow so that you don’t worry that your clients are paying late.
Call Carter Funding Corporation now and get the best deal on your outstanding invoices!
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