How To Know When You Should Use Invoice Factoring
Have you been researching ways to finance your business without getting a loan? If you came across invoice factoring and determined that it’s the best option then you are in the right place. But do you know when the best time is to take advantage of factoring? Below we are going to talk about the opportune time for factoring your invoices.
1. Slow Seasons and Low Cash Flow
If you are going through a slow season where your cash flow is drying up because you’re not selling as much or are waiting on invoices for months, this is a perfect time to factor those invoices. Invoice factoring is designed to help businesses stay afloat when they are having difficulty with finances due to a client’s negligence to pay invoices on time.
A factoring company will purchase your invoices and give you up to 96% on the invoice as an advance. This is the best way most business can get the cash flow that they need to purchase inventory, make payroll on time, complete orders and much more. Not only is it the best way to obtain fast cash, invoice factoring is also an easy, convenient process. With just a click of a button or one phone call, you can apply for factoring and will receive the cash within 24 hours of approval.
2. You’re Ready For Growth
If you are ready to expand your company then you will need the cash flow to do so. Expanding can cost a lot especially if you need to move to a larger space, hire more employees, purchase new equipment or inventory, etc. When you are expanding, you must find the financial means to afford it. If you have funds going out, but waiting long periods of time due to your invoices, factoring is the ideal solution for you. With factoring you can gain the capital you need without paying out of your pocket or getting into debt with a loan.
3. You Have A Start Up
Start up companies are very difficult to raise up and even harder to promote successful growth so it can take off running. If you want your baby company to grow up strong and take off then you will need to help with your cash flow. Many start up businesses take advantage of invoice factoring. From purchasing new equipment, hiring, taking on new clients, and much more you will be in need of reliable working capital. By taking advantage of invoice factoring, you can get your invoice paid right away to have the funds you need to succeed.
4. You Need Short Term Financing
Factoring your invoices is a fantastic short-term solution. It can be used for a wide variety of industries. Essentially, any industry that uses invoices can qualify for invoice factoring. While there are many types of invoice factoring, they have the mutual purpose of providing you with cash you need. If you want to get cash that is risk free, non-recourse factoring is the most popular solution.