If you’re a business owner or manager, you know how important your employees are for day-to-day operations. So when it comes time to pay those employees, you never want to be struggling to find the available cash. Sometimes cash flow can be a little bit tight, especially if you have weekly or bi-weekly payroll obligations, but meeting payroll is a breeze by using the services of factoring companies.
What is Invoice Factoring?
As a growing company, one of the biggest concerns you probably have is cash flow. When your accounts receivable go unpaid, or you have a long payment cycle, the available cash for your business can be even tighter. Rather than stressing out about how you will come up with the cash, or trying to obtain a loan from a traditional financing source such as a bank, which may take weeks, invoice factoring allows you to take those outstanding receivables and turn them into immediate cash.
Your company sells any outstanding receivables and gets the cash you need without worrying about adding more debt to your balance sheet. Since these loans are based on your existing receivables, they won’t increase the liabilities on your balance sheet and you won’t have monthly payments due in the future.
Benefits of Invoice Factoring for Payroll Expenses
For many businesses payroll is one of the largest expenses, and requires that you have a significant amount of available cash for your employees to draw upon. Using your existing accounts receivable through invoice factoring offers several benefits:
- Generate immediate cash when you need it
- Avoid the hassle, time, and paperwork of traditional loans
- Avoid worries about whether and when your customers will pay, particularly if you have a payment cycle of 30 days or more
- Concentrate on growing your business instead of collecting receivables
- Let the factoring company worry about the cost, time, and effort to collect on outstanding accounts
- Get unlimited access to cash, based on your existing receivables, without going into more debt
Find Out if Invoice Factoring Works for You
If your company has a good track record of income, but you find yourself in a pinch for cash around payroll, fill out our rate form to determine just how much cash you could access today.