A/R funding is a kind of financing that provides a perfect solution for companies that require finances not available from mainstream lenders. Most companies do need additional cash flows with an aim of supporting growth, seasonal demands, and opportunities or solve short-term cash needs. Through accounts receivable financing, quick and flexible cash to run your business is assured.
It is because of the many beneficial reasons that A/R financing has been steadily gaining popularity. The advantages that are posed by this kind of funding are way too good to resist. This method improves the financial profile and credit rating of your company. The various benefits brought by accounts receivable are as follows:
Quicker cash flow. This mode of financing provides you with immediate opportunity of converting credit sales into immediate cash flow for the business. Through receiving outstanding receivables monetized by commercial funding company, you get into a position where you can obtain money whenever you are badly in need of it. This save you the time you would spend waiting for weeks and months for your client to pay you your dues.
Focus on your business. Accessing an easy working capital frees up your resources hence giving you a greater peace of mind. With this peace, you are now able to focus on other activities that are more productive such as selling and marketing. That time that would have been used to collect payment from some unsympathetic clients is now devoted to strengthening your business.
More user friendly. A/R financing can be applied to any kind of firm, large, medium and small. Setting up lines on accounts receivable factoring takes only a couple of days. Unlike conventional bank loans, making payments or creating a debt will not be required. In addition, one is free to finance as little or as more as he or she wishes.
Additional services offered. Many funding companies offer necessary aid in managing all your accounts receivables portfolio. These constitute of posting, invoice processing and reporting. A business owner consequently gains more time to attend to those activities that generate revenue. In many instances, factoring companies help to know the credit rating of customers before you make actual sales to them.
The company checks on payment history of potential customers before signing them up. This helps to significantly cut down prospects of bad debts and start dealing with customers with reputable records. In the end, possibilities of getting into financial crunches like inability to pay taxes are done away with.
It is because of the many beneficial reasons that A/R financing has been steadily gaining popularity. The advantages that are posed by this kind of funding are way too good to resist. This method improves the financial profile and credit rating of your company. The various benefits brought by accounts receivable are as follows:
Quicker cash flow. This mode of financing provides you with immediate opportunity of converting credit sales into immediate cash flow for the business. Through receiving outstanding receivables monetized by commercial funding company, you get into a position where you can obtain money whenever you are badly in need of it. This save you the time you would spend waiting for weeks and months for your client to pay you your dues.
Focus on your business. Accessing an easy working capital frees up your resources hence giving you a greater peace of mind. With this peace, you are now able to focus on other activities that are more productive such as selling and marketing. That time that would have been used to collect payment from some unsympathetic clients is now devoted to strengthening your business.
More user friendly. A/R financing can be applied to any kind of firm, large, medium and small. Setting up lines on accounts receivable factoring takes only a couple of days. Unlike conventional bank loans, making payments or creating a debt will not be required. In addition, one is free to finance as little or as more as he or she wishes.
Additional services offered. Many funding companies offer necessary aid in managing all your accounts receivables portfolio. These constitute of posting, invoice processing and reporting. A business owner consequently gains more time to attend to those activities that generate revenue. In many instances, factoring companies help to know the credit rating of customers before you make actual sales to them.
The company checks on payment history of potential customers before signing them up. This helps to significantly cut down prospects of bad debts and start dealing with customers with reputable records. In the end, possibilities of getting into financial crunches like inability to pay taxes are done away with.
About the Author:
Connor G. Schiffman has 27 years of experience in commercial lending including factoring, asset based lending, and banking. Connor helps readers manuver through all the account receivable options providing practical and useful knowledge to better understand all your lending options. If you want to learn more about Invoice Factoring Services he recommends you check out www.receivablefactoring.net.
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