At different times, businesses across many industries can find it difficult to maintain a steady cash flow when they must wait 30 or 60 days or even longer for their customers to pay them. An increasingly popular cash flow solution for business owners is invoice discounting. Also called invoice factoring, invoice discounting could be a very straightforward solution for your business. Typically the invoice discounting company will pay you up to 95% of the value of each invoice on the day you issue the invoice. When the invoice is paid by your customers, you receive the balance minus an agreed fee.
Invoice discounting enables you to immediately boost cash flow and support your day-to-day business needs such as buying stock or paying wages. The factoring company will collect the accounts receivable from your customers on your behalf, saving you time and effort. Many factoring companies offer skilled payment collection services which can ensure a professional and efficient collection process on behalf of your business.
The benefits of invoice discounting
- Boost your company’s cash flow
- Avoid waiting 30, 60 or 90 days to get paid
- Increase your working capital
- Avoid incurring debt through traditional bank loans
- Save your business from an impeding cash crunch
Who uses invoice discounting?
If you often have to wait weeks or months for your clients to pay you, or you experience seasonal spikes in your business that affect your cash flow, then invoice discounting could be an option for you. Many people mistakenly believe that invoice discounting is only for new or growing businesses, but a variety of established companies across various sectors use invoice discounting due to all the benefits that this solution offers.
At Interstate Capital, for example, we offer tailored invoice discounting solutions for the staffing, trucking, oil and gas, manufacturing, service businesses, technology companies and more. Whether you are a new start-up temporary staffing company or run an established freight brokerage, invoice discounting can help you get quick access to your cash.
Any business that wants to expand, take on clients with longer payment terms or increase their order volume to tale advantage benefit from greater supplier discounts can also benefit from invoice factoring. Receiving your cash upfront rather than having it tied up in your accounts receivable means you can build a reserve or have cash on hand to:
- Hire more staff
- Buy new equipment
- Devote more resources to sales and marketing
These are just a few examples of how invoice discounting can grow your business. We also offer a 24/7 online site where you can submit invoices and review your account information on our website..
Why use invoice discounting?
Your business is at risk if you know that you are facing an impeding cash crunch due to delayed payments from clients. You can’t control the payment cycles of each and every client and you shouldn’t have to lose customers or turn away new business as a result of this. Improving your working capital and increasing your cash flow is affordable and convenient when you work with an invoice discounting company. Interstate Capital offers top rated factoring services in North America and their factoring professionals are ready to help you.