Funding Options for Your Business
Finding the right financing option for your business can be difficult. With so many different choices, how do you know which is right for your company?
The right choice might be based on your size, monthly billing amount, the industry you’re in, where you’re located, or a combination of all of these. We’re experts in getting businesses the funding they need to continue growing, meeting payroll, financing new equipment, or cover the costs of anything else that isn’t possible because of a lack of cash.
Check out these different funding options and see which might be best for your company.
Accounts Receivable Factoring
Also known as invoice factoring, this form of funding is used by many businesses to fix an unsteady cash flow due to slow-paying customers.
Factoring is simple. Basically, a factoring company will purchase your invoices at a discounted rate to advance you most of the invoice so you can have the money quickly. The rates will depend on a variety of things like industry and amount of risk.
There are many benefits to factoring, such as:
- Increased cash flow without creating debt
- Flexibility in contract terms
- Fast funding, typically within 24 hours
- Easy approval
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Spot factoring is a form of invoice factoring where businesses factor on an as-need basis with no long-term commitment.
Businesses who want to use spot factoring will not be working with a traditional factor because some factoring companies require you to factor all of your invoices. Spot factors, though, will not have any long-term contracts.
The process of spot factoring is similar to traditional factoring.
- You will deliver the goods or complete the services and invoice your customer as usual.
- The spot factoring company will buy the single invoice and advance you a percentage, typically around 90 percent.
- Your customer will pay the factor according to normal payment terms (60 days for example).
- The factoring company will release the reserve to you, minus a small fee.
If your business gets a government contract, it’s a great opportunity to grow. However, government contracts typically have long terms. Some even longer than 90 days.
Many businesses find it hard to complete the projects because they lack the cash flow, but by declining a government contract, you’re missing out on a very lucrative opportunity overall.
That’s where government factoring becomes a solid, beneficial financing option.
More Funding Options
Small Business Loans
An unsecured business loan is a perfect option for businesses who are looking to purchase or upgrade equipment, expand office space, hire new staff and increase marketing efforts to name a few.
Unlike traditional bank loans, business can get an unsecured loan without using collateral or other assets. If you qualify, your business can borrow up to 90 percent of gross monthly sales.
Applying for an unsecured small business loan requires the following:
- Filling out a loan application
- Submitting three to six months of bank statements
Purchase Order Financing
P.O. funding is an option for businesses in the manufacturing and distribution industry. Purchase order financing is a little more complex than traditional factoring, and it’s slightly more difficult to qualify.
In order to qualify you must:
- A gross profit must be at least 20 percent
- Have similar experience with similar customers
- Have a first transaction of at least $100,000
- Be able to provide qualified purchase orders or letters of credit.
Read more about the P.O. financing process to see if it’s right for your business.
Why Work with Factor Finders?
First and foremost, we’re here to help you. Making sure that your business has constant working capital can be stressful and we want to alleviate your worries. Factor Finders has years of experience in the invoice factoring industry and during that time we’ve built relationships with the best factoring companies. No matter what industry you’re in, we’re committed to helping you find the funding you need to succeed. Our account managers are experts at what they do and will help guide you through the entire process. Our programs are completely flexible and customizable to your business goals. We want to take the guesswork out of invoice factoring. Let us do the work for you–you have bigger fish to fry.
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Welcome to the beginning of your financial future! Call us today @ 855-323-1825
Business Financing for Any Industry
No matter what your industry, Factor Finders can help you get funding. Whether you’re a start-up looking to get first-time financing, or an established business that just needs a boost, we’ve got you covered. Don’t see yours listed? Don’t worry–we’ll find a factoring company for you!
Benefits of Invoice Factoring
Invoice factoring is an alternative yet excellent financing method for businesses that can’t wait long periods of time to be paid by their clients. Factor Finders works with clients in the US, Canada, as well as abroad, making factoring a completely mobile-friendly financing option.
Other benefits include:
- The application process only takes 3-5 business days
- Cash advances on verified invoices within 24-hours
- Money to cover payroll, upgrade technology, accept larger contracts or expand marketing
- Hire new employees or invest in better training programs
- Back-office assistance to aid in taxes, collection calls, invoice management and more
- Build or re-build business credit