Factoring companies benefit companies in many industries, including the staffing sector. Here are a few ways that a factoring company can solve your cash flow problems as well as add value to your business:
Factoring addresses the under-capitalization problem
Whether you run a staffing agency or a company from a vastly different industry, chances are that under-capitalization is (or has been) a problem at one point. It’s easy to underestimate the amount of money you need to start and grow a business, which is why many companies may have to look for alternative funding solutions. Factoring addresses this under-capitalization challenge so that staffing companies as well as other businesses can focus on signing more customers, getting new clients and making more money while all their other expenses are covered.
Customers often don’t pay within a few days
Expecting all your customers to pay within a few days of being invoiced is a grand idea, but it’s often unrealistic. Most clients have their own payment and administration cycles so it’s not uncommon to have to wait 30, 60 or 90 days to get paid. Unfortunately, staffing agencies have everything from expenses and wages to pay on a fixed basis. Whether you’re in the staffing industry or the trucking industry, your expenses don’t magically disappear because you are waiting for accounts receivable to come in. Factoring allows you to cover your costs while you are waiting to be paid by your customers.
You don’t have to turn down sales or clients
Staffing companies as well as other businesses often shy away from large projects out of fear of not having enough money to cover their costs while the project is ongoing. If you are turning down new clients due to a lack of cash, then it’s time to start investigating how a factoring company can solve this problem for you.
Since 1993, the factoring experts at Interstate Capital have been helping staffing companies take their businesses to the next level.Contact us for a factoring rate quote today.