Accounts receivable factoring is a financing solution used by companies to get immediate working capital. With accounts receivable factoring, companies sell their open invoices to a factoring company, in exchange for cash to meet payroll, pay bills, purchase equipment and supplies, and much more.
Companies use accounts receivable factoring because it is a fast, simple and debt-free financing solution for businesses that cannot wait weeks or months for payments from their customers. Companies in a wide variety of industries use TCI Business Capital for their factoring needs. We customize our factoring services to fit the unique situation of each client, and help them reach their business goals.
Accounts receivable factoring is a very easy process. A company using accounts receivable factoring provides the work, services, or products to their customers as normal. When it’s time to invoice the customer, the company sends the invoice to their factoring company, such as TCI Business Capital. The factoring company will advance them a percentage of the value of the invoice. The invoice is forwarded onto the customer, who pays it in their normal terms. Once the invoice is paid to the factoring company, the remaining balance of the invoice is rebated to the company, less the factoring fee.
There are numerous benefits to companies using accounts receivable factoring for their financing. One of the main benefits of accounts receivable factoring is companies that are not eligible for traditional lending easily qualify for factoring. Factoring lines are based on your customers credit and payment history, not that of your business.
Second,having cash available helps companies meet payroll, purchase supplies and materials, settle payables and grow. With cash on hand, companies eliminate the stress and worry over payroll, and can take advantage of new opportunities as they arise.
Finally, leading factoring companies like TCI Business Capital offer value-added services to aid and assist clients. These services include experienced relationship managers, invoice review and billing support, collection services, 24 hour online reporting and much more. These services strengthen your business and free up your time to do what you do best – serve your customers and grow your business.
Accounts receivable factoring is an ideal choice of financing for many companies. Companies in a start-up or initial growth phase are often ineligible for traditional bank financing. These companies can easily qualify for factoring.
There are also situations where factoring receivables is a better choice than bank financing. Because top factoring companies like TCI Business Capital have experience in a number of industries, companies can gain insight and information on industry best practices and current trends.
Since 1994, companies across North America have selected TCI Business Capital for their accounts receivable factoring needs. At TCI Business Capital, we are driven to pride our clients superior service and support. Our portfolio of services incudes:
For more information on accounts receivable factoring with TCI Business Capital,
Call us at (800) 707-4845, or contact us via the web.
With the available cash provided from accounts receivable factoring, businesses can take advantage of new opportunities for growth. Adding equipment or staff, opening new markets, or introducing new products are all much easier with cash in hand. Look at the table below to see how accounts receivable factoring can lead to growth and profits.
|Sales||Sales with Factoring||% Increase||Sales with Factoring||% Increase|
|*Opportunities to negotiate early pay discounts and ask for quantity discounts|
|Cost of Sales||75%||($75,000)||($150,000)||100%||($225,000)||200%|
|Cost of Factoring||1.5%||0||($3,000)||($4,500)|