How a Factoring Company Can Benefit Your Business

April 30, 2019

It is not easy running your own business, especially since you are the one making all of the tough decisions, managing your staff, putting out fires, and most importantly maintaining working capital to keep the lights on and grow your business. After all, every business needs cash to operate. If you are ever feeling strapped for cash, it is ok to ask for help. Scale Funding may be the solution for meeting your cash flow needs. Below is a breakdown of what factoring is and how a factoring company can benefit your business.

What Is Invoice Factoring?

Invoice factoring is a type of financing businesses use to get fast cash. With factoring, companies can get an advance on invoices in 24 hours or less. So instead of waiting 30, 60, or even 90 days for customer payment, companies use factoring to eliminate the wait on customer payment.

When a Factoring Company Could Benefit Your Business

Every business operates differently, and every business’s financial situation is unique. Invoice factoring offers solutions for companies in need of reliable and steady cash flow that they may not be able to achieve on their own.

Below is a list of reasons why businesses use invoice factoring:

Expansion & Growth

Business owners are always searching for opportunities to expand and grow. Growth usually requires taking risks and investing more money in the company. Invoice factoring provides companies with immediate cash to use towards payroll, equipment, supplies, marketing, or whatever is essential to growing their business with reduced risk.

Maxed Out Lines of Credit

Receiving lines of credit from a bank or credit union is a feasible option for some business owners. But for many companies, securing a suitable line of credit can be a chore. If your credit line is maxed out or reduced due to tighter lending policies, factoring may be the solution for you.

Slow-Paying Customers

A lot of companies turn to invoice factoring because they are tired of waiting on customer payment and it is creating a cash-flow gap for their business. Invoice factoring eliminates the wait on customer payment by supplying same day cash on invoices.

Start-ups

It can be challenging to get a business loan and business line of credit as a start-up company, this is because new companies have little to no financial history. Invoice factoring companies give startups the ability to accept new contracts while having a steady cash flow to keep up with operational costs.

Bank Turn Downs

If you have applied for a bank loan or business line of credit then you know it can be a long and frustrating process. Especially, if you have been turned down. When a business requires fast cash, waiting for approval on a loan application can result in missed business opportunities. Invoice factoring can provide companies with a quote for a factoring line in less than 15 minutes.

Less Than Perfect Credit

Tying to obtain business financing through a bank if you have bad credit can be a difficult task. That is why companies with less than perfect credit turn to factoring because invoice factoring companies look at your customers’ financials and payment history and not your own.

In business since 1994, Scale Funding understands the obstacles small and mid-sized companies face when in need of immediate cash. With factoring, companies can receive the instant cash they need to operate, grow, and succeed. If you have experienced any of the challenges listed above, contact to speak with one of our financing experts. The will provide you a free, no-obligation consultation and factoring quote. To begin call (800) 707-4845.