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1521 N. Cooper Street
Arlington, Texas 76011
T: (817) 983-2558
F: (817) 983-2562
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Accounts Receivable Loans
Account receivable
factoring is where A/R and invoices are your most
valuable asset. "Factoring" is simply a way to
finance your sales. You sell your open invoices at
a small discount and you get the cash now. This
cash can be used for almost any business expense such as
paying for utility expenses, salaries, buying new
equipment, or even paying for a new marketing campaign.
There are several benefits
to account receivable factoring which are outlined
below:
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You don't give up
equity as with investment capital or new partners
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You can take advantage
of supplier early payment and volume discounts
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You have the ability to
make volume purchases from suppliers.
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No more offering early
payment discounts to customers
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Elimination of your bad
debt. Factoring is non-recourse
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No additional debt,
factoring is not a loan. (off balance sheet)
Remember, the proceeds from
account receivable factoring are not a loan. You are
literally selling your open invoices for their face
value less a small discount. Therefore, the
creditworthiness of your customers is a critical factor
in determining whether this will work for your business
or not. If your customers do not pay on time, then
the company which purchases the accounts receivables
from you will not do business with you again, and you
will not get the quick financing boost when your
business needs it. |
