Success in business is often determined by the careful management of cash. Many businesses fail because they run out of cash, even though they may have significant amounts owed to them by their customers. Bridging the gap between the point at which an invoice is raised and the time that payment is received can be difficult. For this very reason the use of “cash flow funding” schemes such as Invoice Discounting and Factoring are of huge benefit. Using an Invoice Financing facility can massively improve your cash flow by releasing money as early in the process as possible after the order has been completed.
Invoice Discounting and Factoring are useful options for:
- Business Start Up – offers flexible finance to get your new company off the ground.
- Growing businesses – puts cash back to work for your business as soon as you’ve earned it.
- Struggling businesses – bridges the gap between invoicing your customers and getting paid.
In addition to the increased flexibility improved cash flow offers businesses, other key advantages and benefits gained from Invoice Discounting and Factoring include:
- Releasing up to 90% of the value of your outstanding invoices within 24 hours
- Funding can be secured without requiring other assets
- Cash is freed up to overcome cash flow problems or grow the business
- The level of funding available increases with your turnover
- Paying supplier invoices promptly increases your power to negotiate discounts
- Invoice Discounting and Factoring services are competitively priced
Whether you choose Invoice Discounting or Factoring will largely depend on the size of your business and your sales ledger management resources. If your business is relatively small and your human resources limited, the credit control and collection service that comes with Factoring is likely to suit you better. If your business is larger, and you have the human and information resources to efficiently manage your own sales ledger and debt collection – or if you feel strongly that you want your own company to deal with debt collection – Invoice Discounting is likely to be your preferred option.
What can Blue Sky Corporate Finance do to help you?
If you believe Invoice Discounting or Factoring could benefit your business, or if you have been using this facility but not reviewed your existing rates recently, then contact our team of friendly and professional experts who have a wide knowledge of the key providers in the Invoice Financing market. We offer a free consultation service to help small and medium size business owners ensure they really do get the best deal.
Blue Sky Corporate Finance specialise in helping the owners/managers of small to medium sized enterprises to become investment ready, raise finance, start up a business, to sell a business, to undertake management buy-outs/buy-ins and to make corporate acquisitions.