Sometime in September last year, I remember watching a news report on Fox Business News. There was a gloomy discussion about the funding issues faced by small businesses. A survey was conducted by a leading financial institute, which says that these businesses were struggling to keep sufficient cash reserves in almost all the levels. Their customers were also demanding longer payment terms. The survey also confirmed that 78% of the small businesses actually gave payment extensions to their customers. If your business is stuck in a similar rut, you may be better off taking a different route to overcome it. You can get over this financial crunch with the help of accounts receivable financing which is convenient and straight forward, sometimes in as little as four days.
Giving payment extensions to customers means, your outstanding receivables will no be paid until the end of the usual invoice terms like 15, 30, 45, 60 days after a sale. Additionally as you are aware in a tight economy customers take even longer to pay as they also see you as a financing source for their cashflow situation.
Almost a year down the line, the situation has not got any better. The credit environment is still tight, and small businesses are still trying to cope with this by trying to find a way out of their working capital cash crunch. But there is still hope. If necessity is the mother of invention, then adversity leads to innovation.
Selling your invoices as an alternative funding method will help you through this cash crisis phase, and eventually make your business thrive. These invoices can easily get you the funding you need through Invoice Discounting with any factoring company. You may have less than perfect credit credit history, or you may be a start-up, but these may not be obstacles, since a factoring company is mainly concerned with your customers’ credit worthiness, than it is about yours.
Now, you need not wait for your invoices to be paid by your slow paying customers, just turn to a factoring company and get the cash in as little as four days. Sometimes in subsequent transactions some companies are able to fund in 24 hours. There are even some companies that charge no fees with the exception of the discount fee. This is a nice feature, as I am sure you know finance companies in general have a habit of charging extra fees on everything or any situation.
So yes you can get much needed cash in as little as four days by using the technique of Invoice Discounting or accounts receivable financing to stabilize your financial situation and grow your business even during this slow economy and tight credit market. So, move on from a reeling business to rolling your business!