They say cash is king.

When ample amounts of it are flowing through your business, they are right. But when there’s a lack of cash, the only thing king-sized about it is the trouble it creates.

For many businesses, keeping cash as king is as easy as factoring.

Factoring, in its simplest terms, is just another word for getting paid immediately. It enables businesses to avoid waiting for payment on invoices from customers who take upwards of 30-60 days to pay.

Instead a factor buys those invoices, effectively paying the business right away. The invoices are then forwarded to your customers, who are given the luxury of waiting to pay. Many companies rely on factoring because they simply can’t afford for their invoices to go unpaid for two months.

Universal Funding does the waiting for you.

Offering payment terms can be challenging when working with other businesses. Waiting 60 days to get paid can seem like a lifetime when you have bills that are due in 15. The situation can get even harder when a potential customer seems promising but then asks for lengthy payment terms. Is the opportunity to sign the customer and risk a cash flow problem better than losing out on the customer’s business altogether?

Working with a factor can eliminate that worry and allow you to take on the customer while knowing you’ll be paid immediately.

Universal understand the needs of businesses and the tools that help pave the way to success.

A strong cash flow is vital and factoring provides the capacity to grow when other forms of financing may not be available. Factoring can also provide access to credit and collection services at a fraction of the price of doing it yourself.

Factoring allows your business to be more competitive and make more money.

In short, factoring makes cash king again.

-Travis Griffith

“I had to make a choice: close my business or not.”

This quote comes from a business owner who makes money, employs people and has a steady client base. In fact, the business just secured a contract with a large company that will help the business hire more people and grow.

So why would the business owner wrestle with the idea of shutting down?

Because there was a big problem.

The large company pays its invoices on the 15th of every month but the small business must pay its employees on the first and 15^th each month.

That means the small business will need to pay its employees before it receives payment from the large company. This small business doesn’t have the cash available to buy all of the necessary supplies for the new client and pay its employees on time.

What options does the business have? Delay paying the employees? Apply for short-term credit with a bank? Let its new client go? Close up shop all together?

Paying employees late isn’t a real option. They’ll take it as a sign of trouble and bolt at the first opportunity. Seeking credit from a traditional bank would never be finished in time because of the rigorous approval process.

Closing a profitable business would be an absolute shame, but if the money’s not there, closing remains an option.

But there’s a solution. Solving this business’ cash flow problem is as easy as accounts receivable financing.  This type of financing would allow the business to access the cash tied up in its receivables, purchase supplies, pay vendors, meet payroll and stay in business.

That’s the business of factoring: helping companies grow and succeed.

Even profitable companies experience cash flow problems; it’s a part of doing business. It’s important to know that if your business is experiencing difficulty meeting payroll, paying vendors or buying necessary supplies to fill orders, there are solutions available to you. Even if cash flow isn’t a problem today, it could be tomorrow. When the problem arises, know that Universal Funding has your back and will get you through it.

-Travis Griffith

It happens all the time: A factor will get a call from a company that needs business financing but was recently declined by a bank.

These potential clients are fed up with the process of applying for financing and do not understand why banks don’t see the same growth potential the business owner does.

“If they just provided the cash, I could double my business!”

Banks, though, do not look so much at growth potential as they do number of years in operation. Banks look at hard assets, real estate and equipment that can be used as collateral. Simply put, banks lend against things you own.

That works great for companies with a long history of outstanding performance and flawless balance sheets.

If a company hasn’t been in business long, is in a growth phase or in the process of a turnaround, though, there may not be much for a bank to look at.

Few assets plus a short track record equals no cash.

But, let’s look at this from a factoring perspective.

When those prospective clients call and express their frustration with the financing process, a factoring company, such as Universal Funding, can often put them at ease and explain how it can help. Universal loves to look at a company’s growth potential and listen to the passion of the business owner as he or she explains what could be done with immediate cash.

Many factoring clients are companies that haven’t been in business long, or started out that way, but have since experienced vast growth and many years of profitability.

Watching clients grow is proof that factoring works. Plus, a company that factors will never outgrow its financing. As the company grows, its line of financing grows too.

If your company has had trouble getting approved for bank financing or just wants to try a different way of funding operations, contact us today!

-Travis Griffith

The news from places like North Dakota and East Texas flows as quickly as the oil from these now-booming areas.

In Williston, ND, the oil industry is causing as many headaches as benefits. The housing market is outrageously expensive; if housing is even unavailable. College students are leaving school for oil jobs. Others are  taking classes just to take advantage of cheap student housing while they work the oil fields. As rents continue to rise, the city’s elderly and other established residents will struggle.

But… the oil boom is creating a massive number of jobs and generating truckloads of cash for people and companies involved in the industry.

Universal Funding has financing programs available to provide immediate capital to many of these oilfield service companies. Companies that provide welding, drilling equipment, maintenance, transportation and other services to active oilfields can benefit from the rapid financing provided by invoice factoring.

In most cases, payment arrives within 24 hours of generating an invoice, which means instant cash infusion and eliminating the 30, 60, 90 or more day wait often associated with oil industry payments.

Companies that factor incur no debt because they don’t borrow money. They just get quick cash that allows them to continue operating and grow. Plus, they don’t have to deal with the tedious tasks of collecting on their invoices, dealing with late payers and wondering how to bridge the gap between daily operating costs and finally getting paid.

Factoring is a perfect fit for companies working in the oil industry and money is available right now for those who need it.

Contact us today to find out how much money we have for you!

-Travis Griffith

One of the first questions a business owner will ask when deciding whether or not to factor invoices is, “What will my customers think?”

That is a valid question and one that invokes more fear than needed.

The truth is, this is one of those worries that is really not an issue.

Invoice factoring, or accounts receivables financing, reveals intelligence and flexibility in dealing with a challenging economic climate. It is normal for a smart business to have multiple lines of credit, right?

Of course it is. And factoring could be thought of as nothing more than another line of credit. It provides money much faster, with significantly less paperwork, than traditional bank loans. In fact, having a factoring arrangement can even give you an edge over competitors. When you factor, you will be able to manage your cash flow and avoid cash crunches when the unexpected happens.

And, truthfully, many of your customers, especially larger ones, are already aware of factoring because they use it too.

Many small, mid-size and large companies use factoring to increase their liquidity and control cash flow.  Smart CEOs and owners use factoring as part of a growth strategy; especially when sales increase too fast for a traditional bank to finance.

Your customers can even benefit when you factor because they can choose to take advantage of payment terms that might not otherwise be offered to them.

If you remain nervous about what to say to a customer about your factoring decision, tell them you’ve chosen to factor your invoices to keep up with growth. You can take the opportunity to explain that factoring is an important step for your business and will allow you to continue providing your customers with the great service they have come to expect.

After all, they will still deal with you and your company just as they have in the past. For your customers, the only real change will be the remit-to address on the invoice. Hardly a big deal!

If you still have concerns, contact Universal Funding today. Our experts can discuss ways to inform your customers and make factoring work positively for you; and them.

-Travis Griffith

Choosing to factor your invoices is a smart decision.

Deciding which factoring company to use can prove daunting, however. Hundreds of factoring companies exist in the United States alone, so how can you know which is a good match for you?

While factoring is a business arrangement, you’re likely to have a fair amount of personal contact with the people at the company you choose; more so than with a typical bank relationship. The ability to speak with your account manager needs to be as simple as picking up the phone and dialing. No complicated phone menus, just a real person answering your call.

Also, the best factoring company for you must:

• Specialize in the industry you do business in, ensuring a proper base of knowledge and experience with the unique issues you face.
• Demonstrate a track record of stability, responsibility, integrity and strength.
• Offer access to a credit department staffed with experts in the industry
• Employ a professional collections staff who treats debtors (your customers) with the same level of respect that you do.
• Use current technologies to offer you 24/7 access to up-to-the-minute status reports on your account.
• Offer no-charge business advice and tax assistance.
• Make quick decisions and provide your money fast.

Of course, low rates and easy-to-understand terms are important too, but look for a factoring company that is interested in building a relationship with you and your business. Find a company that has similar goals and ideals as yours and you’ll enjoy a smooth path to financial freedom and healthy profits.

We hope you’ll find that Universal Funding is the factor you’ve been looking for!

-Travis Griffith

Being in the business of cash, we talk a lot about its impact on our lives and our businesses. The economic recession that we’re slowly climbing out of has taught business owners many lessons on how to manage cash, but it has also left a lasting legacy that will likely continue even when the economic engine is running at high speed again.

That lasting legacy is one of late payments.

While extended payment terms are becoming more common in the business world, the financial stress they can cause are also piling up. Many companies are caught between customers who want up to three or four months to pay and vendors who want to be paid immediately. It’s a catch-22 that can drive otherwise healthy businesses out of business.

Late payments are typically from large companies. Understandably, businesses dealing with these late payers are afraid to ask for quicker terms because they don’t want to risk losing the business. Being paid late is a better choice than not getting the business at all.

Right? Well, there’s another choice.

Universal Funding offers a way out of this catch-22. By working with us, you get paid right away, your customer gets the payment terms he wants and your vendor gets her payment immediately (which could even lead to early-payer discounts for you).

On top of all that, some factoring companies offer access to business strategy experts, credit-checking capabilities, detailed A/R aging reports and so much more.

This is how it works:

A factor pays you immediately when an invoice is generated. Instead of waiting 60-90 days, you might wait 4-6 hours for the majority of your payment. Then you have the money to pay your vendors, invest in marketing or buy more product. The factor waits for the payment, keeps track of the aging and provides receivables reports and payment records.

When partnering with a factor, you have access to a funding source that grows along with your company and ensures you always have the cash you need. No matter what economy we’re in.

-Travis Griffith

You might wonder, besides getting money right away, what else a factoring company can do for you.

If you’re working with a limited service factor the answer is, not much!

However, Universal Funding is a full-service factor and offers a wide range of services that can be tailored to meet your needs.

A limited service factor typically will not do much more than buy your invoices and collect the money. However the benefits offered by a full service firm like Universal can help any company become more successful.

Perhaps the biggest benefit achieved through invoice factoring is establishing a schedule of predictable cash flows. Cash runs business, every one knows that, and being able to rely on a consistent source of money keeps you productive.

It is hard to do business while waiting for money to show up. It is even harder when you don’t know when, or if, it ever will. Factoring can help companies build more accurate budgets and keep projects on schedule. More cash can increase purchasing power with suppliers, increase production, purchase valuable business assets and much more.

The value of reliable cash flow alone is worth the nominal factoring fees, but start adding the value of the additional services and you will definitely get more than your money’s worth!

First of all, remember that Universal Funding works for you! Our goal is to get you your money faster and works hard build your success.

Many banks, on the contrary, are really only interested in your ability to make payments on the loan. Actually, since the loan is most likely secured with some kind of collateral they may care little if your company actually prospers or not.

We, on the other hand, want your business to increase.

Universal Funding can even offer complete oversight of your company’s accounts receivable department. This can include everything from billing, follow up, and collections. This service can be especially useful for small and midsize businesses that usually do not have a dedicated A/R department, staff, or even person. Small business owners and managers wear a lot of hats and having to allocate time for managing customer accounts can be distracting to say the least.

One of the biggest lessons in business school is to stick with your core competencies- do what you know and do best and get someone equally knowledgeable to do the rest. Factors have the expertise in this department; out-sourcing the receivables department reduces costs and wage expenses and allows the company to focus on its bread-and-butter business operations.

In contrast to a bank loan with the interest and fees that go along with it, factoring is a much better value. Instead of paying a bank for the privilege of borrowing money from them- only to be harassed for interest payments- factoring fees include additional services from people genuinely interested in you and your company. Universal Funding keeps companies moving forward by relieving the worry associated with sporadic cash flows.

The quick answer: Myth.

The longer answer: It depends on specific situations.

When a company factors its invoices,  it doesn’t borrow any money or get a line of credit. In fact, there is no debt at all.  Instead, accounts receivable are used as a sort of collateral for instant cash flow.

The factor, or the company providing the financing, buys accounts receivable and takes on the responsibilities associated with collecting on those unpaid invoices. Because of this, a business won’t get the full invoice amount; but will generally get up to 99 percent of the face value.

Some benefits of factoring  include:

• Instant and reliable cash flow for a business that can be used without limitation.
• The ability to pay vendors  early and establish better relationships and take advantage of potential discounts.
• The ability to buy supplies and equipment and always keep up with demand.

All that comes at a cost generally between 1 or 2 percent of each invoice. Considering that cost could potentially pay for itself with vendor discounts, factoring is actually an economical  way to finance a growing business.

If factoring sounds good so far, contact us today, and we’ll look at your specific situation and help you determine the best course of action for your financial needs.

-Travis Griffith

Business management is full of options from organizational structure to compensation packages, accounting techniques, raising capital and many more.

Invoice factoring is an option available for keeping money in the bank so that your business can continue to move forward. Just like choosing whether to run the company as a sole proprietorship, LLC, or incorporate in Delaware, the decision to factor requires a bit of due diligence.

Not every business is run the same way with the same goals or motivations, so it follows that not every business benefits equally from all options. The balance of pros and cons for factoring is different for every circumstance, but there are certainly a lot of companies who find the benefits of invoice factoring to be vital in their continued growth and success.

Small and upstart businesses often have trouble obtaining capital through traditional bank loans, especially in the current economic climate. Larger companies with lower credit ratings or those seen as “informationally opaque” are labeled high risk and quickly dismissed.

Many of these companies would actually be very successful if they could rely on more consistent cash flows. Invoice factoring is very beneficial for businesses that must wait 30, 60, or 90 days for their customers to pay. These delayed cash flows may be interrupting daily operations like the purchase of materials, paying employees, paying rent or any number of other expenses which limit production or even bring business to a grinding halt.

Simply put, banks won’t lend money to a company that has bills piling up and zero inventory. Factoring is different because instead of evaluating your company’s ability to repay a loan, a factor focuses on the debt already owed to you. Once the invoices have been validated, cash is typically available in 1-2 days and business can go on as usual.

If your business is beginning to struggle because operating capital is tied up in accounts receivable then factoring may be a viable option for collecting those debts and maintaining predictable cash flows.

Let Universal Funding quote you a rate, and then we’d be happy to discuss how factoring can benefit you.