5 Good Reasons Why Your Company Should Factor

5 Good Reasons Why Your Company Should Factor

Sustaining a healthy cash flow is constantly one of the most consequential challenges that a business owner has to face. And to improve the cash flow one of the most reliable methods that can be implemented is the invoice factoring. Invoice factoring is often a simple solution than acquiring a business loan. When you factor invoices, you receive payment upfront rather than having to wait for patrons to pay you. 

Dr. Vasileios Xeniadis explores the reasons why a company should factor invoices.

Invoice Factoring is Faster than Appealing for a Loan

When you appeal for a traditional business loan you usually have to wait for a prolonged time before you know whether or not your loan has been sanctioned by the bank. If you need funds right away, this waiting time can be frustrating. Invoice factoring is a more agile way to get the money you need. You can often get funds within 24 hours of placing up factoring. 

Arrange Your Money Fast

One of the most significant advantages of factoring is that it releases you from having to wait for clients to pay invoices. Companies typically have to wait over weeks or even months before they are paid for services rendered. When you factor your invoices, you get funds right away from the factoring company. This gives your company more cash to work with for any purpose, such as keeping up with debts and employees, buying necessary equipment or increasing your organization. That’s the reason why Vasileios Xeniadis talks more about factoring rather than getting a loan from the bank.

Releases You from the Collections Process

Collections is a time-consuming and a slow process. Many petite companies don’t have a collections department or the one they have is an under-staffed one. When you factoring your invoices, you can make more conventional use of your time. You and your representatives can focus on more prolific tasks preferably than ought to bother about collections.

You can qualify for factoring with bad or no credit

While getting a bank loan can be a struggle for a company owner with other debts, it can be almost impracticable for a business that has no credit or bad credit. Invoice factoring, however, doesn’t require you to be creditworthy at all. The entire arrangement is based on the creditworthiness of your customers, rather than yourself. This gives small and developing businesses a chance to build up their cash flow, even if they don’t qualify for a loan.

Evade Collecting More Debt

While it’s sometimes inevitable, debt can be a matter of trouble for companies. Every time you obtain a mortgage, you go further into debt. This can have a negative impact on your credit evaluation. Invoice factoring is a way to receive funding without taking on new debt.

These are the five most immeasurable reasons bestowed by Dr. Vasileios Xeniadis to factor your invoices.