A wide number of industries can benefit from invoice discounting. It gives you the ability to respond swiftly to market shifts and can serve as the foundation for a long-term growth strategy. Factoring and invoice discounting can be used in a wide range of industries, and this section explains why certain businesses have turned to this method of borrowing.
If you are looking for a company loan, you don’t have to limit yourself to a short-term option. It might be difficult to choose which sort of loan best meets your company’s needs when there are so many available options.
Construction
Paying individuals at the bottom of the construction industry’s pyramid might take a long time because of the industry’s hierarchical system of contractors and subcontractors. This problem is addressed by construction factoring, which is beneficial to both small businesses in the middle and independent contractors at the bottom of the payment chain.
You may bid on future work with confidence, competing on an equal footing with larger companies thanks to the money advanced on bills for completed work. The money is there, so you can acquire supplies and recruit additional workers. It’s all taken care of for you by the factoring company, so you can focus on building your business instead of chasing payments.
Transportation and logistics sector
If you need to engage drivers for one-time delivery or a long-term contract, you may not have access to enough cash on hand without risking your monthly budget. It is possible to get cash infusions within 24 hours of sending an invoice through factoring and discounting.
Businesses in the logistics industry must become more adaptable if they hope to compete with the bigger players. Even small businesses can benefit from borrowing money based on the work they have already done, allowing them to respond more quickly and with greater agility.
Production of goods
Invoice financing can be used to meet the unique cost requirements of the manufacturing business. In addition to the regular salary and facility expenditures, business owners often have to juggle a constant stream of repair and maintenance fees for their machinery. If you’re in the manufacturing industry and have faced this and other cash flow issues while waiting for payments to come in, you may benefit greatly by ‘selling’ your sales ledger to a factoring company.
Printing and distribution
Printing and publishing enterprises can use invoice financing to expand and thrive. Rather than waiting 30 or 60 days for a check, you can get paid right now. The lender swiftly advances a percentage of each invoice, allowing you to take on the next significant contract or repair that critical piece of machinery. Suddenly, your company’s cash flow is much better, and you can see a path forward for long-term expansion. To qualify for financing, you don’t need an excellent credit rating — it’s doing business with credit-worthy consumers that counts.
Services provided by experts
Businesses that offer credit terms to their customers can benefit from factoring, which can help them get paid. A 90-day payment delay can be frustrating, but it’s also time-consuming to chase down the money and risk offending an important customer. Cash advances are made within 24 hours of receipt of an invoice, thanks to invoice financing. The arrangement can be kept private if desired, and not having in-house credit control saves money. Architects, engineers, and legal organizations, as well as businesses in the financial industry, could benefit from invoice discounting and factoring.
Factoring and discounting in the hiring process
Recruitment has long had an issue with the time it takes to pay employees and receive paid for the services they do. Managing your cash flow so that you can prepare for future expansion is likely to feel like you’re balancing on a knife’s edge. In this situation, the value of invoice discounting cannot be overstated. It is common for lenders to release 80% to 90% of the total invoice amount as soon as you invoice your customers. As a result, you’ll be able to focus on securing additional work rather than worrying about meeting your payroll obligations
Security firm invoice financing
As a result of invoice financing, your company’s reputation in the security field will be maintained, as well as your employees’ sense of security. When you invoice, money is released to the firm. The only limitation to the amount of money available is how much work you take on.
Finance for the transportation industry
Fuel, labor, and vehicle maintenance costs are all volatile, and this can put a strain on transportation companies’ cash flow. It’s possible that your funding needs will change from month to month, but this sort of financing gives you the ability to prepare for the future by smoothing out your cash flow each month. In order to maintain your clients’ trust, transportation industry financing can be kept private through a variety of customized options. For long-term growth, or just as a short-term fix when cash flow is low, use it.
Factoring for wholesalers and distributors
There are long credit periods that are common in the wholesale market; if your firm is facing cash flow challenges, you may benefit from a custom factoring solution. Wholesale and distribution companies use invoice discounting to ‘sell’ their unpaid invoices. A fresh lease on life can be found in your organization by utilizing factoring to shorten the time it takes to get paid.
Factoring for export and import enterprises is flexible, efficient, and easy to set up since it meets all of your demands and objectives. This service can bring you in touch with reputable lenders and provide objective advice on the best sort of invoice financing for your business.
We work with a panel of lenders who can finance invoice discounting products depending on your business’ industry. Lenders include: Bibby, Hitachi, or Close, to name a few.
To find out more about invoice discounting, and how it can help your business, get in touch with the team at Funding Bay.
