If you have recently become the owner of a new small business, especially one that is primarily or solely based on the Internet, you know that collecting timely payments on your invoices is a major concern. You may well be involved in a segment of the industry where services are often rendered considerably in advance of payment received. This is precisely why invoicing your client and keeping track of these invoices is such a crucial part of your daily operations.
How Can You Keep Track Of All Of Your Operations In A Timely Fashion?
If you are the sole proprietor of your online business, the onus will be on you to keep track of each and every one of your operations in a timely and productive fashion. Even if you have taken the measure of hiring a small staff to assist you in the day to day running of your business, there may still be some vital parts of your operation that don’t receive the full attention and care that they truly deserve. In the long run, this lack of attention to these details may impair your productivity and profitability.
This is precisely why it’s an excellent idea to engage the services of a reputable and qualified invoice factoring service to assist you in handling these matters. It’s no fun waiting 30,60, or 90 days to receive payment for the services you have rendered. If you feel that a client is purposely ignoring your repeated reminders concerning the invoice you have sent them, it’s time to take action in order to collect the payment that you are due. This is an area in which a factoring company can be of direct and timely assistance.
How Does A Factoring Company Tailor Its Services To Assist Your Business?
There are a number of ways in which a factoring company can tailor its services to assist your business in its time of greatest need. For example, if you have invoiced certain clients for services and have not received a timely payment, a factoring company can assist you in the vital matter of collecting these payments. Of course, this is only one example of the many different services that a factoring company is normally equipped to perform on behalf of your business.
Perhaps the most popular and characteristic function that a factoring company normally performs on behalf of a business is to advance you money based on the total amount of your unpaid invoices. This means that you aren’t really taking out a traditional loan from a bank or corporate lender, but merely receiving an advanced payment on money that is already due to you from the clients you have previously billed for your services. The most important feature of this arrangement is that you are not the debtor – the factoring company will bill your client to cover the amount that you have been advanced.
Why Is Working With A Factoring Company The Best Solution?
For many small businesses, working with a factoring company is a better solution than going to a traditional lender. This is because when you deal with a factoring company, you won’t incur any new debt, or have to face the prospect of paying long term interest on the money you have been advanced. Since the amount of your loan is based on the total amount of unpaid invoices, the amount is fixed and there is no interest attached.
Creating advanced solutions for present day invoicing issues is what a factoring company does best. While other lenders may engage in a certain amount of speculation when it comes to giving out a loan, the arrangement you reach with a factoring company is far more secure. This means that you are able to bypass most of the red tape associated with a traditional loan and get your advanced cash in a timely manner.
Advanced Solutions For Present Day Invoicing Issues
Another important advantage of dealing with a factoring company instead of a bank is the fact that your debt will be paid off by the party that got you into financial liability in the first place: The client who failed to act on your invoice in a timely manner. In most cases, the factoring company will advance you the money, collect payment from the debtor, and this will be the entire operation in a nutshell. This is exactly why small businesses should choose a factoring company over a traditional lender.