Strengthen your company’s cashflow and working capital with invoice financing through invoice factoring or invoice discounting.
If your business sells to other businesses on credit, you will appreciate the options for invoice financing that allows you next day access to 90% of the invoiced funds. This means that money is available immediately to reinvest in your business. This is particularly important if your company has to purchase supplies and services in order to provide product to your clients. Having cash available allows you to negotiate for better prices for your purchases and to take advantage of special deals that are offered. You can move from simply responding to orders to planning strategically to increase the demand for your business
If your company decides to use an invoice factoring service, it will be handing over the entire invoice management process to that service. This means you have access of up to 90% of the invoice value within 24 hours. The invoice finance company collects what is owed. Then, the remainder of the amount owing less the handling charges is remitted to your company.
There are advantages besides the ready access to cash for your operational needs. Your company also reduces the cost of processing invoices, debt collection, and the risk of bad debt. There is access to this money from anywhere in the world, an important consideration in today’s global economy.
Invoice discounting is a slightly different service that also gives your company next day access of up to 90% of the invoiced amount. However, your company retains control of the invoice management process. In effect, you are simply using your unpaid invoices as collateral for borrowing money.
Some companies prefer holding that control over their invoices so they are up to date with the financial status of the client. It also makes it easier to maintain a good working relationship with client businesses that are prompt in honouring their debt. Using an invoice discounting service does mean that your company still has to pay for resources for processing invoices and collecting the monies owed. Whichever type of invoice finance service is chosen, your company will enjoy the benefits of a strong, predictable cashflow.