You meet the minimum length of business operation - A factor may require that you've been in business for a minimum number of months.You run a business - Some factors may need to see proof in the form of LLC or incorporated structure.Still, factors often have some bare-minimum requirements to take on a business. CUSTOMER SERVICE REPUTATION - Some clients may perceive your use of a factor as a sign that your company is in financial trouble or be annoyed at dealing with a third party.Īs we mentioned earlier, the invoice factoring application process tends to be very simple compared to a traditional bank loan.YOU MAY BE HELD RESPONSIBLE IF A CLIENT DOESN'T PAY AN INVOICE - This can be a big problem if you've already spent the advance.Do your homework to avoid unscrupulous factors. RISK OF UNETHICAL FACTORING PROVIDERS - Anytime an industry serves people who need quick cash, you'll find some predatory players.Fees on money transfers or credit checks may be much higher than a more traditional financing option. UNEXPECTED OR HIGHER FEES - If an invoice becomes delinquent, for example, you may face daily rate increases until the factor is able to collect the funds.(You may be able to negotiate more control with a factor). LOSS OF CONTROL OVER INVOICES - Customers may get nervous when a third party collects debts instead of you.SAVING TIME - For some businesses, having a factor handle collecting payment from clients may be a time-saving perk.FLEXIBILITY - Factors may offer low minimums, spot factoring, month-by-month contracts or other terms to help you customize your plan based on your business needs.LOW MINIMUM LEVEL OF RECEIVABLES - Several major factors, such as Bluevine and Capital Plus, don't require monthly minimums at all.LOWER LIABILITY - You're selling the invoice, so you won't have to use your personal credit or put up business assets as collateral.HIGH APPROVAL RATES - New businesses that haven't built the credit to qualify for a traditional loan may still be approved by a factor."They're trying to use this money to make money, not just pay bills." GROWING YOUR BUSINESS FASTER - "There's a huge difference between a small business and a consumer," according to Steve Denis, executive director of the Small Business Finance Association.QUICK ACCESS TO CASH - A factor can give you an advance on receivables in days, not months.Consider the pros and cons carefully to decide whether your business will benefit from working with a factor. Why not get your invoice factoring quote right now? You may have cash for your invoices in just a few days.Invoice factoring is handy for some businesses, but this isn't a one-size-fits-all financing solution. Factors will provide you with the credit and pay history on future customers so you can avoid doing business with non credit worthy businesses that can waste your time and money. In addition to getting funded the same day the work is completed and invoiced California invoice factoring acts as your business credit department at no extra cost to you. Invoice Factoring will get you the cash flow needed to keep growing your business in California. How often does the waiting to get paid affect your ability to pay your suppliers on time or meet payroll obligations? Stop the madness of acting like the bank for your customers. Outstanding receivables can make your California business a challenge to run at times. Our fast invoice factoring program will turn your outstanding invoices to immediate cash. Does your California business need financing? No matter what size or industry your business is, California invoice factoring is a lending option that takes just a few days to get set up and you will have access to your cash to do whatever you would like with it.
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