3 Ways Cash Flow Funding Helps the Bottom Line
Written by US Funding on November 13, 2015
If you’re a successful small business owner, you may be looking for ways to access cash to meet payroll or monthly expenses, to accommodate a rapid growth phase, or to invest in equipment or raw materials to fill a big order. You have several options, including using a credit card, taking out a small business loan, or even tapping into equity in your equipment or facilities. But each of these cash sources has a number of drawbacks. For instance, credit card debt is tied to high interest rates and a reduced credit score, small business loans are difficult to get and take too long to close, and taking out a loan against equity is too risky.
On the other hand, cash flow funding not only gives you the cash you need quickly, but it actually can improve your overall business operations and your balance sheet. Let’s look at three reasons to use cash flow funding, otherwise known as invoice factoring, and find out why your accounting department will love you for using factoring to get the money you need.
1. Improve your company’s bottom line.
When you take out a loan or use a credit card to gain access to cash, these decisions result in debt for your company, and show up as negatives on your balance sheet. On the other hand, when you factor your invoices to access cash faster, this shows as income on your balance sheet.
If you’re looking to show positive cash flow to investors, cash flow funding help keeps your company “in the black.” It’s a proven method to manage cash flow, minimize debt, and encourage business growth.
2. Reduce your bookkeeping department’s workload.
When you sell your unpaid invoices to a factoring company like U.S. Funding, the factoring company now handles your Accounts Receivable. That means your bookkeeping department has fewer duties. Many small businesses employ one bookkeeper to manage Accounts Payable, Accounts Receivable, cash flow, balance sheets, and payroll. Your bookkeeper is probably already stretched thing. U.S. Funding helps lighten the load, while giving your business the cash you need faster.
Additionally, by outsourcing your accounts receivable to U.S. Funding, you may be able to reduce the size of your accounting team, saving your company additional money in salaries, benefits, and infrastructure.
3. U.S. Funding can also manage your payroll and other bookkeeping and back office functions.
Many small business owners use cash flow funding to meet payroll when customers are slow to pay or on Net-30, Net-60, or Net-90 trade terms. U.S. Funding can manage your payroll, too, ensuring your employees get paid in a timely manner. We can even establish direct deposit for your employees. We have expertise in payroll taxes so you don’t miss deadlines and incur penalties. Our team can generate and issuing W-2 forms, manage 401K deductions and track employee benefits. We also provide temporary staffing functions for many bookkeeping and administrative duties.
Cash Flow Funding and More
It’s easy to see that U.S. Funding is the right choice for cash flow funding, so why not call us to become your one-stop shop for bookkeeping, payroll, and back offices functions for your rapidly growing small business?