Having trouble getting a loan for your business? Consider factoring your account receivables instead. For many small businesses, factoring receivables provides a way to turn non-liquid assets such as invoices into instant financing without incurring debt or damaging credit.
Universal Funding, a receivables factor, can provide you with a cash advance based on a percentage of the total value of the invoices that you provide as collateral. Once your client pays the invoice, you would receive the remaining value, minus a small factoring fee.
Getting advanced financing for your invoices might be the right step for your business to take. In this new business era, factoring invoices can help your revenue multiply by removing the lag time of getting paid for the services you have rendered.
For more information or to have one of our factoring specialist contact you, please fill out a rate form.
Your company’s accounts receivable are considered to be a type of asset, and as such can be sold as collateral.
Some companies sell their accounts receivable to a factor at a discount. This allows the company to focus on the core of their business with a new surge of cash through factoring. The factor can purchase the accounts receivables with recourse and non-recourse terms. Click here to read more in-depth about the varying terms.
Selling accounts receivable at a discount is a great way to inject some much needed capital into your business whether you need to finance your payroll, pay for services or equipment, or even build venture capital to grow your company. It is especially attractive to businesses that cannot, due to a poor credit rating or a host of other reasons, get traditional loans. Even if you have a good credit past, you may simply be a victim of the times as the turbulent economy has made many banks much less willing to lend money.
Contact us today at 1-800-405-6035 to speak with one of our factoring specialists or get started with your risk free quote.
The decision to factor your invoices could be one that provides many years of growth and profits for your company.
Like any big finance decision, you are likely to have some questions and concerns about the process and its implications, both short and long-term. With invoice factoring, one of those concerns could be what your customers, business associates and/or advisers will think of you factoring your accounts receivable.
First, rest assured that accounts receivable financing is an incredibly common form of business finance used by small, medium and large businesses throughout the world. Even if you are new to the idea, odds are your bigger customers are quite familiar with the process, and even expect it.
Universal Funding has been in the factoring industry for over 15 years, successfully helping thousands of other companies grow and become more profitable. If you have a question, we’ve probably heard it before and can provide a concise answer.
Don’t take it just from us, though. If you have professional, trusted business finance advisers ask them about factoring, too. The good ones will be able to talk you through the many different kinds of factoring and which might be the best fit for your business.
As far as your customers go, the only change they might notice is where they send their payments to you. Your invoicing process doesn’t change and your invoices remain exactly the same save for a change in the remit-to address. You retain complete control over your company, your money, and your customers.
When you’re ready to discuss factoring with some of the best in the business, give us a call and we’ll happily walk you through our process while introducing you to our company and learning about we can help you.
To learn more, please go to our Get Rate page.
Invoice factoring has been around, in some form or another, for centuries. It’s one of most tried and true forms of business financing out there.
Like all things in this day and age, technology has impacted the evolution of factoring. Businesses have begun to sprout up offering online auctions for a company’s receivables, where a business owner can post an invoice and have random investors buy it for a discount.
In theory that means an easy way to generate quick cash flow on an as-needed basis. Plenty of companies have tried these online factoring services, but some problems are beginning to surface. Problems that don’t happen when using a factor like Universal Funding.
When using an online auction-type factor, you never know who is buying your invoice. In fact, one invoice could be split between more than one investor. That may not seem like much a problem… until you consider that each invoice will be verified by the investor who buys it. That means your customers will be the ones bombarded with calls attempting to make sure the invoice is genuine. Do you want your customers dealing with the inconvenience and frustrations of that? That’s especially true if you do repeat business with the same customer over a long period of time. That customer is going to get awfully sick of fielding phone calls from different people every time you invoice them!
By factoring with Universal Funding, you still get a great rate and you get your cash just as fast. Plus, you always work with the same person and you know who is buying your invoices and can rest assured you and your customers will be treated with complete respect.
Unlike the auction sites, we are not a one-shot wonder factor. We build relationships with our clients and debtors and help businesses grow. We believe in and have adapted the latest technologies into our business, but one thing we’ll never stop doing is partnering with our clients and investing ourselves personally into their growth and success.
As our industry evolves, you can be sure our commitment to you and your business never changes.
A potential client of ours recently said he was trying to decide between using a merchant cash advance loan or invoice financing to fund his business.
Both funding sources have benefits, but there are some key differences to keep in mind if you find yourself facing a similar decision.
First of all, the cash advance is essentially a short term loan. Some companies classify it as a “sale of future credit card sales,” which shields them from interest rate limits, which can range from 10 to 100 percent. The bottom line, though, is it creates a debt that must be repaid, typically through a percentage of future credit card sales.
The benefits are immediate cash and an easy application process.
Invoice factoring is not a loan and creates no new debt. There is no money to pay back, ever. After an easy application process, funds are deposited immediately based on the value of your accounts receivable. Perhaps best of all, the financing line increases as your sales grow.
When Universal Funding is your provider of invoice factoring, rates can start as low as 1 percent. And with the added benefits of working with Universal, you have access to free business advice, tax help, credit checks on new customers and the option to obtain A/R insurance.
Choosing the right form of business financing is a huge part of any company’s success. If you’d like to discuss how invoice factoring can benefit you, as the gentleman mentioned in the opening paragraph did, please contact us today!
He’s the latest to benefit from our funding services, maybe you can be next!
Eleven companies were approved last month to begin taking advantage of the financial services offered by Universal Funding Corporation.
Industries represented include medical, government, manufacturing, janitorial, media, freight logistics, corporate safety and staffing.
The companies combine for a total line limit of $3.15 million per month, all of which is debt-free money the companies can use to grow their businesses. In addition, they have access to Universal’s credit screening services, tax assistance and accounts receivable insurance program.
The Universal Funding family is better off for having these companies as clients, and we look forward to helping them with their financial needs and watching them grow to their full potential.
As always, if you own a business, or know of one, that might benefit from financing through Universal Funding, contact us today and we’ll be happy to discuss your needs.
A common misperception surfaced this week while discussing the process of factoring with a professional acquaintance.
We were talking costs and my friend asked about typical rates that Universal Funding offers. Of course, that’s a question that varies depending on the client, the client’s customers, the volume of financing and the size and frequency of invoices. However, it’s pretty safe to say the majority of our clients enjoy rates somewhere between 1 to 2 percent for 30 day terms.
My friend, like many others looking into invoice factoring, assumed he could multiply that rate by 12 and figure out the yearly cost of factoring is between 12 and 24 percent.
That is not correct, and here’s why:
First, it’s important to remember that invoice factoring is not a loan, and thus the rate charged is not an interest rate. It’s more like a discount fee. Let’s say, to keep things simple, that my friend has a business that factors a $100,000 invoice every month. Let’s also assume the customer pays within 30 days and the rate is a flat 1 percent.
The financing cost, then, is $1,000 for that 30 days.
Let’s also assume that my friend does this same transaction every month for 12 months. That translates to $1.2 million in invoices, and $12,000 in factoring fees. Do the math and we’re able to show my friend that even over the course of a year, the rate is still 1 percent, not 12 percent.
That’s pretty inexpensive business cash! Plus, factoring can easily pay for itself through reduced administration costs and by taking advantage of early payer discounts offered by vendors. Not only that, but the increased cash flow can allow for business growth, an increase in hiring and ultimately, more profit.
If you would like more information on how factoring can benefit you and your business, contact us today and we’ll happily run some numbers and give you an idea of how we can help.
Universal Funding Corporation, a leader in the business finance industry, has two new ways to help its clients succeed and grow.
First, the company implemented eFactor, an innovative software application allowing clients to view account balances, get payment details, view detailed activity reports and directly upload invoices to be purchased; all in a secure online environment.
The software helps streamline the process of funding and eliminates the need to fax or mail reports when requested by clients. Universal’s clients have access to their account information anytime they wish.
With eFactor, clients can run real-time reports such as Debtor Payment History, Collections, A/R Aging, Advance Rates, Reserve Balances and more.
Secondly, since accounts receivable are vulnerable to unexpected losses but are typically the only major asset left uninsured, Universal Funding now offers AR insurance. This program provides in-depth credit analysis and ongoing account monitoring to provide early warning of potential credit risks before they become a loss. This service provides valuable protection to the company’s clients against the consequences of customer insolvency and non-payment.
Universal Funding prides itself on providing workable solutions and customized finance plans to meet the needs of almost any company. Universal Funding’s strategic plan for growth includes providing clients with the best tools, funding and support to grow into highly profitable businesses. The peace-of-mind of accounts receivable insurance and the convenience of eFactor help meet those goals.
We live in tough times. Who really knows if the economy is on its way up or about to turn back down? Of course we all hope for the best but, the truth is, we just don’t know.
That’s why protecting cash flow is so important right now. In a growing economy, business owners like you will need to keep up with increasing orders. In a sinking economy, they will need to bridge the gap and keep the doors open.
It doesn’t help that, right now, companies face longer payment terms from customers and tighter loan restrictions from banks.
That’s where factoring with Universal Funding comes in. Factoring offers many benefits for companies of all sizes. Chief among those is the ability to produce needed cash very quickly. But there are other reasons why factoring is so advantageous for so many companies:
1. Factoring streamlines your accounts receivable duties
When you factor with Universal Funding, we assume the responsibility for managing the invoices. This means that you won’t have to worry about performing your usual accounts receivable duties such as sending out invoices or making follow up collection calls. We will even keep customer records for you, saving you the trouble of file storage and maintenance.
2. Factoring allows for increased cash flow without going into debt
The most common form of business funding is small business lending from traditional institutions. However, taking out a new bank loan requires taking on the responsibility of repayment. With invoice factoring, a company can avoid any new debt, which means no money to pay back.
3. Even companies with poor credit, or no credit at all, can qualify for factoring
Getting a bank loan can be a struggle for a business owner. It can be nearly impossible for a new business or one with no credit or bad credit. Since invoice factoring is based on the creditworthiness of a business’ customers, small and developing companies can use it to build cash flow, even if they don’t qualify for a loan.
4. Factoring gives business owners more time
Instead of following up on customer invoices, business owners can get right to work on new projects, new marketing efforts or new customer accounts. Universal Funding will take care of all the collections work, payment processing and record keeping for you.
5. Universal Funding offers even more
Whether you need the peace of mind of accounts receivable insurance, help with tax problems or just sound business advice from experts in the field, Universal Funding can help. The purpose of our business is to help you grow.
Invoice factoring offers many benefits to businesses including a fast cash advance period, a streamlined collection process and the ability to increase funds without taking on debt. If you are interested in seeing how invoice factoring can help you, contact us now!
Traditional bank financing just doesn’t move fast enough for companies that do business in the oil and gas industry.
Oilfield service companies often have all kinds of equipment to help in the production and transportation of energy. Power units, vacuum trucks, frac tanks and anchor trucks are just a sample of the machinery companies operate on a continual basis. Demand for that equipment continues to skyrocket, which means business is moving fast.
In fact, business moves so quickly in this industry that companies need to have financing in place that can expand as fast as new opportunities arise. When a company knows growth is coming, it needs a flexible credit facility available to meet its needs no matter how much the company has in revenues and expenses.
Relying on the slow pace of bank financing can mean missed opportunities for new business. Out on the field, that could mean equipment sitting idle; which means no money coming in.
Accounts receivable financing, though, offers the flexibility to quickly respond to new opportunities while providing a credit limit that keeps pace with a company’s growth. In short, it means the equipment keeps running and the cash keeps flowing.
Universal Funding can provide that flexible financing along with the peace of mind in knowing there are no worries about trying to figure out the next financial relationship. We also know that things change fast, and make sure our clients have access to their account rep whenever a need arises. Whether there’s an issue that needs solved or a new opportunity that requires more funds, that person is always available to help.
In the oil and gas industry, a company has to strike while the iron is hot. The potential cost of not taking on a next job or customer is huge, but we all know it takes money to make money. Universal Funding can supply that money, and a business owner can rest assured that the business will grow and the next opportunity will easily be within reach.