Cash Flow Solution : Factoring

Many companies look to Factoring as a good cash flow solution, but some types of industries are ideally situated to reap the most rewards from this alternative versus an unsecured small business loan.

Many of these businesses are plagued by slow paying or late paying customers which can reduce cash flow to a trickle. Factoring allows these businesses to free up capital and gives them a predictable cash flow volume, enabling them to grow their business at a faster rate. Some of these industries include:

Transportation Companies

Many of the expenses of running a transportation company are up front: Fuel, tolls, maintenance, payroll, and taxes all must be paid in a timely manner, often before invoices are paid to the transportation company. Using such an accounts receivable line of credit increases operating cash flow.

Manufacturing Companies

Upfront cash allows your business to expand by investing in new inventory and equipment, which can keep you competitive in today's challenging business climate.

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Service Industries

Businesses such as consulting firms, IT companies, security services, and wholesalers who may have late paying customers see factoring as a viable cash flow solution.

Machine Shops

Factoring can enable machine shops to grow more quickly; with increased cash flow they are able to take on bigger customers and fill larger orders.

Temporary Employment Agencies

The time lag between placing temps, being paid for their services, and meeting payroll can produce a real cash flow crunch. Temp agencies sometimes fail because they run out of working capital; having a Factor account receivable line of credit alleviates these concerns.

Oil and Gas Industry

This is a typically expanding, growth oriented industry which can benefit from increased cash flow to assist with the company’s growth and enlargement.

Distributors and Re-sellers

These companies need a predictable and manageable distribution of cash flow. The availability of working capital without waiting 30,60, or even 90 days past invoice can give these companies the ability to grow.

More Benefits of this Cash Flow Solution

In addition, Factoring can provide companies with:

  • Efficient Management
  • Early Discounts
  • Payroll/New Hires
  • Tax Obligations
  • Cash Shortfall Solutions
  • Funded Growth
  • Purchasing Power
› Cash Flow Solution