• Money Roll

Turn Invoices Into Cash

Waiting for payment on goods already delivered, this can make a small business' cash-flow very tight. Using invoice factoring is an effective strategy to moderate the ups and downs of the billing cycle, yet only one fifth of qualifying businesses take advantage.

How it works

Before your customer makes payment on their invoice, the factoring services company purchases the invoice at a discount. Once the factoring company collects from the customer, they'll take an agreed upon service fee and return the balance to your company.

Why it works

There are several reasons invoice factoring is an effective option for your business.

  • You can receive immediate payment for invoices, better managing cash-flow over longer billing cycles.
  • Receive cash without effecting your credit rating. It's still best to compare rates and charges to traditional financing options, like banks.
  • Invoice factoring helps manage risk. Pay bills and salaries on time, and have the cash on hand for unexpected expenses.
  • Free up your time and your employees time. Moving collections to the factoring company gives you more time to work on money generating activities.
  • Potentially save money. Costs associated with invoice factoring can be more than offset by reducing your collection management costs, because the factoring company manages the process.
  • Good factoring companies ensure customers pay on time, shortening the payment cycle.
  • Your ability to access more cash with invoice factoring grows as you increase your sales. As your invoices grow larger, your invoice factoring increases. Stop renegotiating borrowing rates and credit limits with banks.
  • By smoothing the ups and downs in cash-flow and allowing you to make payments when they're due, invoice factoring can decrease stress levels.

Use invoice factoring to manage cash-flow

Invoice factoring services and associated fees can be negotiated based on your business' circumstances. Use full- or minimal-service options. The best thing, however, is probably to use the lowest level of services you need to reduce the time you spend on managing collections and more time on growing your business.

For instant Cash Flow, call our office near you. 1-800-241-CASH (2274)

DMC Firewall is developed by Dean Marshall Consultancy Ltd