The Top 10 Reasons to Use Accounts Receivable Factoring
At Universal Funding we have heard countless reasons why companies want and need our accounts receivable or A/R factoring services. Here are the top 10 reasons businesses choose to work with factoring companies for their financing needs.
- To Make Payroll: “We need to make payroll by the end of the week.”
- To Pay a Supplier: “We need to pay our trusted supplier for raw materials.”
- Declined by Bank: “We were declined for bank loan and still need financing.”
- A/R Management: “We don’t have someone monitoring invoices and incoming payments.”
- Slow Paying Customers: “Because many of our customers require 15, 30, or 60 payment periods, we have a small fortune tied up in accounts receivables.”
- Low Cash Flow: “Every single month, we earn revenue but never have cash on hand.”
- Fast Growth: “Sales are growing, but cash flow is dwindling. We can’t sustain this level of growth.”
- No Debt: “We don’t want any more debt, but we still need financing.”
- Can’t Fulfill Large Orders: “We can’t take on more customers or big jobs, because we don’t have the cash to front new projects.”
- Swamped: “We’re so busy, that we need a financing solution that’s fast and easy.”
If your company has faced any of the reasons why companies factor invoices, you’ll appreciate the top 3 benefits of invoice factoring:
- Our application, approval, and funding cycle is often completed in a matter of days.
- Because you’re trading one asset (invoices) for another asset, (cash), you are creating no debt and thus no payments.
- The cost ranges from 0.5% to 4.0%. On average our clients get factoring rates between .55% and 2%.
For more information about invoice factoring, contact us today at 1-(800) 405-6035 or fill out a rate form to speak with one of our factoring specialists today,