We all know that one of the most important parts of being a business owner is being able to come up with cash when it’s needed. When a vital piece of equipment breaks down or you need to pay a supplier fast in order to maintain a good working relationship, you need a solution that is dependable, efficient and easy. Receivables financing is helping many different types of businesses avoid shutting their doors just because they can’t pay their bills. Using the cash that is expected from the businesses outstanding receivables, business owners can cover their expenses quickly and easily and they don’t have to worry about waiting for customers to wait months to pay. For those who work with large suppliers that may have long payment terms that can include anywhere from net 30 to net 90 days or more, and for business owners who are relying on that money to pay their bills, that amount of time can be damaging to the business. When you can’t pay your bills, replenish your inventory or pay your staff, it’s time to make a change.
The beauty of receivables financing
Receivables financing provides a simple way for businesses that are losing money or that have already gotten dangerously close to bankruptcy to take a step back and get a solid grasp on their finances again. Instead of taking on a loan or another type of traditional business financing, receivables financing is more like outsourcing your AR department to a company that buys your invoices from you at a discount, giving you the cash for them upfront. The company then owns your invoices, and then proceeds to collect on them.
Receivables financing boosts your business income
For businesses that are falling behind and who could use the extra boost of some added income, receivables financing provides just what is needed to get back on top. Small to mid-size business owners that are in danger of losing their business or who are starting to struggle to pay their bills each month can quickly begin to feel the strain of trying to keep a failing operation from going under. For many, it’s a welcome form of relief from the stresses of owning a business and it can help them turn the business around successfully.