Many businesses selling to commercial or government clients face a common problem: long payment cycles. You deliver your product or service, then wait, sometimes up to 60 days, to get paid. This delay puts a strain on cash flow, making it difficult to cover immediate expenses like rent, supplier payments, and employee salaries, hindering growth potential.
Traditional bank loans can be difficult to obtain and often lack flexibility, focusing on past performance rather than future potential. Invoice factoring offers a solution tailored to your sales potential.
Invoice factoring eliminates the wait by providing immediate funds upon invoicing. Instead of waiting up to 60 days, you can get paid within days. This rapid access to capital enables you to take on larger orders, manage expenses efficiently, and accelerate your business growth.
The process is straightforward. After delivering your product or service, you send the invoice to your client and a copy to the factoring company. The factoring company then advances you a significant portion of the invoice amount, typically within 24 hours.
This advance provides the financial flexibility to manage expenses and pursue new opportunities, leading to business expansion. Once your client pays the invoice to the factoring company, the transaction is complete.
Factoring is relatively easy to secure, with the primary requirement being creditworthy customers. If your business needs financing and works with reliable clients, invoice factoring is an option to consider.