Avoid an Irreversible Financial Tailspin

Like it or not, doing business with large companies usually means you have to offer 30-90-day terms.

Doing so offers small businesses a way to win, and retain, some potentially lucrative business contracts.

As a matter of fact, many large customers simply demand these payment terms as a condition of doing business. The problem, of course, is that waiting up to 90 days to get paid can wreak havoc on your company.

Unless you are exceptionally well capitalized, you will risk running into cash flow problems as a result of offering terms. You may risk missing supplier payments, being late on employee paychecks or missing out on marketing or growth opportunities. A few missed payments and your company can quickly go into an irreversible financial tail spin.

Even companies that are healthy on paper can enter a tailspin. The balance sheet might show plenty of money to take care of obligations, but if that money isn’t in the bank, it might as well not exist.

This is where Universal Funding can help. We can help solve this problem by factoring invoices, which significantly reduces the time it takes for you to collect your revenues. Factoring provides the working capital you need to meet current expenses, and the money you receive never has to be repaid. Also, your customers retain their payment terms and are not required to pay any faster.

Universal Funding’s invoice factoring programs can provide your company with financial stability which can be used as a platform for growth. Our factoring lines will increase with your growing sales, making them a flexible financing solution for growing companies.

Secure Financing for Your Growing Business

Plenty of new and existing small businesses have benefited from invoice factoring.

Many companies take advantage of this fast cash funding source and continue to use the money for whatever purposes they wish. They’ve purchased new equipment, paid their vendors early, paid their employees on time, paid off crushing bank debt, invested in marketing, taken on new customers and more. Most importantly, they have lifted the burden of worrying about cash flow and eased the financial stress on their businesses.

But is factoring for all businesses?

No. Unfortunately, not all businesses qualify to benefit from invoice factoring. Universal Funding is proud to offer factoring services to B2B companies in industries we are well-versed in serving. Those include:

  • Oil and energy
  • Printing and publishing
  • Staffing and temporary personnel
  • Business service providers
  • Transportation and trucking
  • Wholesale and distributing
  • Manufacturing and fabrication

We are also open to speaking with business owners who operate B2B companies in other industries. If you run a reputable business and work with credit-worthy customers, odds are good that we can secure financing to help you grow.

Invoice factoring can assist a lot of businesses with their finances, and getting approved is easier than the stringent requirements set by banks.

Invoice factoring is great for new and small businesses that aim to expand. This financing option allows you to receive payment on your invoices well in advance of the due date. There is no need to wait 30-90 days for the customer to pay the invoice. Simply put, you get your cash immediately and we play the waiting game with your customer.

A Quick Way to Fund a Growing Business

Let’s say you own a company that has developed an all-new, incredibly cool device that combines a camera, GPS, phone and personal assistant into one super-convenient pocket-sized device.

Yes, it’s kind of like the iPhone, only better.

Your device works all the time, around the globe, without a wireless contract. It’s pure genius.

Because you are as good at marketing and sales as you are at inventing, you’ve managed to sell $100,000 worth of these devices to Walmart.
You produce the devices and ship them along with the $100,000 invoice, which is sent to your contact in the purchasing department.

But, of course, she doesn’t have the Walmart checkbook in her back pocket so the invoice gets forwarded to the accounts payable department, which is in another state.

You agreed to 30-day terms when you set up the lucrative new Walmart account, but it didn’t occur to you that it typically takes 35-55 days the average net-30 invoice to get paid. Even longer with big corporations.

In the meantime, you score another $100,000 deal, this one with Costco. You manage to build the product and ship them out, along with the invoice, but you know there are another 30 days, at least before any money comes in.

So now you have $200,000 in accounts receivable, but no cash, no more room on your line of bank credit and no more devices to sell. Business grinds to a halt. Payroll is due. So is rent on your building. And the heat bill.

Your bank won’t loan you more money until you deposit the outstanding $200K. You think that’s crazy, but there’s nothing you can do. You consider asking your employees to wait for their paychecks.

But then you stumble across the Universal Funding blog and feel like invoice factoring might be the answer. And you know what? It is!

We will advance you money on those invoices, typically around $80,000 each. That means you get $160,000, today, and can start building more devices and pay your employees. Everyone is happy.

When we get paid by Walmart and Costco, your remaining $40,000, minus our small fee, gets deposited into your account.

The best part? When you generate more invoices, we send you more money and the process starts over. You never run out money and you have the resources to keep building your company and selling your product.