Accounts Receivable Financing Growth
What are your dreams and goals for your business? From expanding services to opening a new location, every business has a list of growth opportunities in mind. If you’re unsure how to gain the capital you need to grow your business, consider using accounts receivable financing.
This flexible financing option is a great way to leverage your working capital and take your business model to the next level. Accounts receivable financing works by contacting a factoring company to set up financing solution. Most businesses have accounts receivable that won’t be paid for up to 30 days or more. Because of this delay, your business may be struggling to keep up with day-to-day expenses.
With this form of financing, you can receive up to 90 percent of the outstanding receivables immediately. It’s an excellent way to ease your financial burdens without going into debt or paying large amounts of interest. Even better, it’s paid in cash, so you can use your funding however you see fit.
Know Your Business More
From daily costs to long-term growth opportunities, your financing can help you get a better grip on your business. You can keep it in savings in order to shore up your finances for a rainy day, or you can use it for a sudden investment opportunity that you otherwise wouldn’t be able to accept.
There are, of course, pros and cons to financing your accounts receivable. While it’s a great way to receive fast funding for your business, you’ll also lose a percentage of your profits. Some factoring companies charge 10 percent, but others charge up to 30 percent of your invoices. This can make it a difficult decision, since your business will be making less in the long term. However, it’s a competitive way to receive cash in pivotal moments in your business growth history.
For example, opening a second location or adding an online marketplace to your storefront can be ways that you grow your business exponentially. Short-term flexible financing can give you the winning edge you need to make these transitions not only possible but also successful.
After you’ve carefully reviewed your growth opportunity and determined whether its a pivotal moment or not, you’re able to make an informed decision about accounts receivable financing. Choose the course that sets your business up to succeed in the future without sacrificing present profits. With the right financing option, your business can enjoy a large and sustainable upward trend. Give us a call today!