How Can I Get Cash for My Receivables or Invoices?
When running a small business, you need access to lots of money so you are probably wondering how you can get cash for your receivables or invoices. Account receivables and invoices serve as proof that your business is moving forward. However, your creditors will not accept your account receivables or invoices as payment.
Right now, you may have a mountain of receivables or invoices just sitting there, doing nothing while you wait 30, 60 or 90 days for them to be due. You’ve worked hard to get those receivables and invoices, pounding the pavement, brokering deals and knocking on doors. Now, it’s time to make them work for you by turning them into cash.
Can You Turn Your Receivables and Invoices Into Cash?
There are several ways you can get fast cash. One of the quickest methods of immediate business funding is to sell off your assets. However, your most valuable assets are most likely those you can’t do without.
For instance, if you sell your business property, you would have no place to conduct your business. Selling equipment or machinery would leave you unable to produce your products.
It is at this point that you should remember that receivables and invoices are also assets. They are simply the cash your business has earned but that you have not received in hand yet. Therefore, as assets, you can sell them.
Where Can You Go to Get Cash for Receivables and Invoices?
Today, there are many companies that will purchase your receivables in return for cash. It is crucial that you know the terms and conditions of each type in order to make the best decision for your small business.
Traditional factoring companies are one choice for selling your account receivables or invoices. Nonetheless, you should be aware that they can take up to three months to get your money to you. Also, your customers will have to pay the money they owe you to the factor, which is like waving a red flag saying you are having financial troubles.
Receiving business financing from a factor will also include expensive fees which gets added to the cost of the loan. In addition, they usually require a long term commitment, meaning it could take two years for you to repay the money.
A cash advance company, like Financing Solutions (www.fundmypayroll.com), is a better choice because they work differently. They still purchase your account receivables or invoices, but you can get the short term business financing you need in as little as 48 hours. Also, you will be able to repay the money in a few weeks or months.
This is very helpful when you need the money immediately just to get over a rough patch, to make up for a slow sales month, or to take advantage of a new opportunity for business growth.
How Does the Process of Selling Receivables and Invoices Work?
The practice of accounts receivable and invoice factoring has been a popular method for obtaining quick business financing since ancient times. One of the reasons it has lasted so long is because it works and is an effective means of getting cash when you need it most.
When you have receivables and invoices, it is written confirmation that you have made a sale. They signify that someone out there has purchased your product or service and has agreed to pay you for it in a reasonable amount of time. The problem is that while you are waiting, you still have to make payroll, pay bills, handle daily operating expenses and grow your business and these activities require cash.
To get the cash you need, you sell your accounts receivables or invoices to a factor. The factor will then provide you with cash based on their worth or a percentage of their value, typically about 75 or 80 percent. For instance, if you have a receivable or invoice worth 100 dollars, you can receive approximately 80 dollars in cash for it. It’s just that simple.
Getting cash for your receivables or invoices is a wise option, especially when a fast business loan from a bank is not possible. In truth, an emergency business loan at a traditional bank is out of reach for most small businesses.
So don’t let those account receivables and invoices keep collecting dust. Turn them into instant business funding with Financing Solutions.