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Factoring 1… 2… 3…

An ongoing challenge for small and mid-sized businesses (SMB) is finding the right sources of capital to fund the business.  Running a business requires real-time financial resources.  All too often company finances are overlooked until it is too late.  Do not wait to the last minute to find the right financing tools.

There are many financing options for small businesses, and factoring, also known as accounts receivable financing, can be a great choice for some companies.  Factoring companies can vary dramatically in what they offer so make sure to know the facts before you commit.

When looking for a factoring relationship remember Who, What and When”.

  1. Who is the best factoring company for my business?

Look for a factoring team with tenured management and operational staff.  Get to know the people you will be working with because WHO makes a difference.  Relationships are key, especially when dealing with what can be stressful financial matters.

  • What factoring program is right for my business?

Most factoring companies have similar programs but it’s how they work with the business that matters most.   Many factoring companies have industry specializations in areas like trucking, medical, and staffing that could be beneficial for those business owners.  Selecting a factoring partner focused on companies that are familiar and skilled with WHAT you do.

  • When should you work with a factoring company?

WHEN slow cash flow is preventing you from meeting your obligations on time, then it may be time to factor.  Most companies experience slow paying customers from time-to-time, but if it has become the norm, then factoring could be the answer.  Factoring is usually a short-term resolution for businesses.  Most businesses become eligible for commercial financing after they have been focused on strengthening their financials while in a factoring program.

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