If your recruitment company is in need of financial assistance because of unpaid invoiced from clients, or if you would just like to speed up the process, then factoring may be something that will improve your business and any financial worries you may have. Factoring is something that is mainly used in industries where businesses need access to quick cash, and would prefer to pay a small fee, rather than wait for the full amount.
So if you haven’t already considered recruitment factoring, here are a few advantages and ways that you can get the help of a factor to buy your accounts.
Doesn’t Require any Collateral
If you were to get a traditional loan from a bank or other lender, you would have to get it against your home or other assets that you have. This is a risk to you if the business is not a success and may leave you in serious financial trouble. Having a factor buy your accounts does not cost you anything; you will simply charge them a slightly smaller amount than the full value of the account or invoice. This means that you will never owe them anything, which is a huge advantage.
Great Way to Grow Your Business
Once a factor has bought your invoices then you can use that money any way you like. You do not need to account for what you are buying, as you may with a traditional loan, and you can invest the money back into your business very easily. This will mean that you can grow your business faster and ensure that you will never have any problems with non-paying clients or invoice queries; which will also save you valuable time and effort.
Companies May Be Entitled to Extra Funding
It may be possible for you to get more cash from a factor than you could get through your bank or other lender in the form of a loan. This means that you will be able to increase the money that you can re-invest into the business and help it grow; as well as maintaining a good credit history and meeting payroll requirements. Information about this is easily available online; http://www.cashsimply.co.uk/improved-cash-flow/ and similar sites can advise you on the options that are available to you and the benefits of working with a factoring company to improve your business prospects.
Saves You Time and Effort
It can be time consuming and tentative when you are having to wait for your clients to pay their invoice. If they do not pay on time then it is up to one of your employees or yourself to chase them for the money; this can take valuable time out of your schedule and may lead to extra stress and hassle. A factor will pay you for your invoices; so not only will you get your money straight away rather than having to wait the allowed 30 to 60 days, you will not have to worry about whether they will pay at all.
The Money is Yours to Spend How You Like
As I have mentioned, the money that you get from selling our invoices to a factoring company is yours to do with as you wish. A conventional business loan may have certain terms and conditions attached to it which may limit what you can use the money for; this can be inflexible and difficult to manage. If you receive money from your factor for your invoices you have complete control over it and you can spend it however you wish. So find out more today and watch your recruitment company grow and succeed.
Image Attributed to FreeDigtalPhotos.net Stuart Miles