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Invoice Factoring for Service Providers
Whether you’re an electrician, plumber, heating and air specialist, or another type of service provider, you know that one of the biggest challenges in growing your business is having the cash on hand needed to make the moves to expand. One of the biggest contributing factors to this problem is waiting for clients and customers to pay their invoices. Frequently, clients and customers will wait until the last possible moment to pay on their invoices, leaving you waiting for capital while lucrative projects and deals pass you by. The result can be missed opportunities and slower growth than you might otherwise have had. The solution to these problems can be found in invoice factoring.
What is Invoice Factoring for Service Providers?
Invoice factoring is a financial product whereby a factoring company purchases your receivable invoices and provides you with cold hard cash. Typically they’ll provide an initial funding of 80-95% of your invoice’s value, and pay out the remainder once the client settles the invoice. The result is that you get the money you need to grow your business when you need it.
Benefits of Invoice Factoring for Service Providers
There are many benefits invoice factoring affords service providers. The first is that invoice factoring ensures that you have the cash on hand to do whatever it is your business needs. This can including hiring labor, buying new equipment or vehicles, expanding your office or warehouse, or anything else your business needs. There’s no restriction on how you can use the funds, so you’re in complete control.
Additionally, invoice factoring lets manufacturers consolidate and centralize many of the accounting and administrative tasks that can take up so much time. As a result, you’ll have more time to focus on your business and figure out ways to grow, rather than figuring out your books.
Finally, invoice factoring gets businesses funding fast. Many factoring companies provide funding in 24 hours or less. That means you’ll have the cash on hand to run a shift for a rush order, buy new equipment or repair equipment that has broken down. This can help you get ready for big projects, and remove worry over whether or not you’ll be able to complete orders on time.
As you can see, invoice factoring can provide many benefits to manufacturers. If your manufacturing business is facing a cash crunch, consider invoice factoring. It may just be the solution you’ve been looking for.