3 Ways Small Business Factoring Can Help Your Business
Written by US Funding on December 28, 2015
With increased consumer spending and higher related profits in the current marketplace, small businesses are showing themselves as a prominent force in our economy. Although showcasing a strong standing, many small businesses continually seek ways to continue their trend of growth. Many owners who want to expand their businesses are looking at small business factoring as an alternative to a traditional business loan or other financing options.
Small business factoring provides liquid assets by selling company receivables to a third party. Often, small businesses choose factoring over a loan because of the ease and quickness of the financial transaction. Small business factoring is a great tool to use for growing a business. Here are three ways factoring helps to grow your small business.
The health of a business is not only measured by the sales, but also by the rate at which it grows. In order to grow, a business needs the liquid cash to invest in its expansion. This is where small business factoring helps. Perhaps you need to buy more equipment, expand your physical location, acquire more product, or hire more employees. Instead of having money locked up in invoices and uncollected accounts, your accounts receivable are converted to liquid cash for available use.
Business Development Time
When you are consumed by day-to-day functions, you are not able to invest your time on other things that can help develop your business. Collecting accounts receivable is a time-consuming part of running a successful business. Most small businesses are not large enough to have an entire department dedicated to this task and may have a dedicated employee or owner handle this function.
A third party small business factoring company can handle this task and free up your time to pursue business development, which is important to creating new opportunities. Whether you are looking to form partnerships, perform acquisitions, or concentrate on your business operations, a small business factoring company can serve as your accounts receivable department. This third party handles the collection of invoices, so you can focus on developing and growing a strong, healthy business.
With small business factoring, you are not incurring debt as you would with a loan. This keeps your balance sheet free from loans payable. Without the burden of additional liabilities, small business factoring allows your company to stay debt-free. This increases your financial standing and credibility among suppliers, customers, and investors. Not only does it give you a positive cash flow, but opens the business up for even more financial options in the future.
Small business factoring is a viable solution to help expand and grow your business. When selecting a factoring company, reviewing their terms, features, and flexibility options is important in determining if the company is a good fit for you. US Funding specializes in small business factoring and our experienced staff works with your business to create financing solutions that meet your specific needs. With access to cash in 24 hours or less, competitive rates, proven methodologies, and state-of-the-art systems, your small business can be on its way to experiencing the growth you want and need.