When you factor your accounts receivable, you will be able to enjoy the benefits that come with increased working capital. In addition, you’ll also be able to hand over the job of collecting from your clients to your factoring company. You will be saving both time and money!
Now all you have to do is determine which factoring company you’re going to partner with. But how do you decide? What makes one factoring company better than another one? There are several things that you should keep in mind when choosing a factoring company:
A factoring company should provide you with a single point of contact – an account manager or account executive who will be your go-to person whenever you need assistance. You will start to get a sense of the type of people at a company right away as you begin to talk with its representatives. What type of vibe do you get from these people? Are they friendly, professional and eager to help? Remember that your clients are going to be dealing with them too, so partner with a factoring company that offers the type of customer service that you deserve.
Ease of managing your account
Some leading factoring companies have invested in online management systems for their clients which makes the entire process of submitting funding requests quick and easy. Instead of faxing or scanning invoices, you can do everything online from the comfort of your home or office. Some of the more advanced systems also give you the ability to track payments and get a bird’s eye view of your accounts, which can be highly beneficial for any business owner.
The company’s experience in the factoring industry
When considering who to factor with, look for a long track record of success. Experience does have its advantages. Companies that have been in the factoring industry for decades have proven to be reliable and have had the time to refine their services, develop extra programs that benefit their clients, and create tailored packages for different industries.
The company’s experience in your industry specifically
The needs of a temporary staffing company owner will vary greatly from the needs of a freight broker or a manufacturer. It is a good idea to partner with a factoring company that has experience in your industry. Not only will they understand their clients’ needs, but they will also be able to offer you tailored solutions that can help you run your business more efficiently.
Rates and numbers
At the end of the day, your goal is to grow your business and improve your cash flow. Fees are important to you. Ask a factoring company about advance rates, the percentage they charge for each invoice that they factor, and about any additional “hidden” fees.
For more information about factoring choices, get an instant factoring rate quote today.