Using a Factoring Service as Alternative Funding for Your Business

1. Using a Factoring Service as Alternative Funding for Your Business Cash on hand and flowing is the absolute bread and butter of any small and growing business. You need cash on hand to meet your payroll, fund development of the business, and even just for day to day function of the business. That flow of cash, though, can be a frustrating pursuit as customers rarely meet payables in time for you to pay all expenses. It is the nature of small business, but that doesn't make it any easier. One solution is using a factoring service as alternative funding for your expenses while waiting for invoices to be paid. Using factoring service as alternative funding for your company is fairly simple to do. You essentially will be selling your accounts receivable from your customers by taking an advance on a percentage of the cash value of the invoice Alternative Funding. Then, once the factoring company is paid, they will pay themselves back, take a fee, and return what is left to you. When you chose to use a factoring service as alternative funding, you will also be able to have the cash on hand in a hurry. Most companies will give you 80% to 90% of the value of the invoices in 24 hours. That means no waiting for the factoring company either. Getting the money fast allows you to relax and think about things besides the money. When you run a small business, the more problems that can be taken off of your place the better off you are. Using a factoring service as alternative funding does require an application be filled out. You can do it online or in person. Generally, you will be required to give detailed information about your company, yourself, and your customers. Make sure you have business ID and your social security number ready for credit checks. However, most companies actually do qualify since the loans are backed by the invoices anyway. Finding a company is easy as well. You can look online and find hundreds of factoring companies available. You can also talk to local financial institutes and banks who often times offer it as a service to their small business customers. Be sure, though, to shop around for the best rates you can get. It is still your money. Using a factoring service as alternative funding allows a small business to have more control over their invoices. You can factor all or just selected invoices from customers. It allows you to have cash on hand, make payroll, and even cover day to day costs. With your finances under control, you can concentrate on growing and running your business and less on when your customers are going to pay and whether or not you will have the cash on hand in time. Using a factoring service as alternative funding can be of great value to your small business. Let's face it, cash flow is the key to a successful small business, and yet cash flow is the toughest problem in small

2. business. By funding and turning over much of the responsibility for that money to a larger entity, you can take more time to worry about the next step for your business. Stu Pearson has an interest in Finance & Business and Factoring Service, for more FREE information and articles please visit Factoring Service Resources