Factoring What Is Factoring? Factoring is a quick and flexible form of financing which substantially improves a company's cash flow. Many companies get into a cash bind by extending credit to their customers for 30 days while having to immediately fund certain costs, particularly payroll. This problem only gets worse as sales grow. With factoring, your invoices are used as collateral for a short-term loan which provides you immediate cash with which to meet these expenses.
There are several advantages to factoring. Maximizes the cash available to you Factoring provides more cash than traditional bank lines of credit. No arbitrary line of credit amount You borrow based on your sales activity so you are automatically set up to finance your growth. Cash Flow is more predictable In addition to speeding up your cash flow, factoring also makes it easier to manage your cash since your invoicing is more predictable than when customer payments will be received. Flexibility with your financing Factor when you want, as much as you want, and for as long as you want. With Liberty Capital, there is no minimum factoring level or commitment to factor in the future. Improved credit evaluation Liberty Capital can provide credit reports and expertise in helping to assess new customers or changes to existing ones.
And when you use Liberty Capital, you've added a business professional to your team whose expertise can benefit you beyond just financing. We welcome the opportunity to discuss your particular situation and needs. Is Factoring For You?
Any company that extends credit terms to its customers can benefit from factoring its invoices. Factoring puts the cash you will collect in 30 days into your bank account today. This accelerated cash flow allows you to:
Grow - You have the financial means for an almost limitless increase in sales.
Think Big - Go after the accounts and contracts you thought were "too big."
Factoring works well for many companies who have solid customers but only limited resources to front the necessary costs for 30 to 40 days until payment arrives.
Is your cash tied up in unpaid invoices?
Is payroll your largest expense?
Are you growing but increasingly short of cash?
Have you been in business only a short amount of time?
If you answer yes to any of these questions, factoring is a good financing solution for you to consider.