We will explore the positive impact of factoring, also referred to as accounts receivable financing, on a business in the Staffing Industry. We hope you learn how Universal Funding can improve your cash flow and ensure the growth of your business.
Universal Funding can improve your cash flow and ensure the growth of your business by offering accounts receivable financing. To explore the positive impact of factoring, we will investigate a business in the Staffing Industry; for the purposes of this successful factoring scenario, we will call our company My People Corporation*.
My People Corporation, a temporary staffing company that provides a wide variety of skilled personnel, saw a rare opportunity to significantly grow their business in a short period of time. They guessed that many companies who laid-off workers because of decreased revenues after the economic downturn would still need staff to perform jobs on a limited basis. With this increase in layoffs, My People Company also predicted an influx of new job seekers registering for placement with their company.
Within a few months, they started to experience the high demand for their services as well as the increase in their personnel they predicted. My People Company wanted to gain a competitive edge over other staffing agencies in the area.
To accomplish this, they shortened their pay frequency from a biweekly to a weekly basis. Unfortunately, they lacked the working capital to pay new staffers while waiting for clients to pay 30 day invoices. My People Company needed a fast cash flow solution to make payroll.
Based on their accounts receivable invoices, Universal Funding was able to custom design a factoring program just for My People Company and advanced them the cash they needed. As the staffing company acquired new contracts and new temps, Universal Funding was able to increase the amount of funding to keep up with their growth. My People Company is now one of the largest staffing agencies in its metropolitan area. Factoring their accounts receivables with Universal Funding was the cash flow solution that allowed them to anticipate the demands of the market and grow quickly without taking on new debt.
* Not actual name. Representation based upon a combination of general examples.