Alcohol Inventory Invoice Factoring
Invoice factoring is a financial service that gives business owners a way sell open account receivables to a factoring company. When this happens, the factoring company issues a lump sum immediately to the company that sold them the open invoice. Invoice factoring services are helpful for small and medium-sized businesses experiencing growing pains or need fast access to cash for any number of reasons.
Why work with an Alcohol Inventory Invoice Factoring factoring company?
For business owners who have documented sales and transaction receipts, invoice factoring offers an alternative funding solution to stabilize cash flow and get access to credit card deposits quicker. Funds made available from factoring companies can get used for anything the business needs, whether it is to pay bills, buy inventory, or ramp up marketing efforts.
Do not confuse invoice factoring with a traditional business loan. These are two very different financial services. Conventional loans create debt for the borrower (company) whereas invoice factoring does not. Invoice factoring uses an ‘advance system’ that grants business owners access to credit card payments before the customer pays the invoice. Recent sales history, as well as credit card volume, are the two critical aspects of qualifying for invoice factoring. No collateral is required, and bad credit is acceptable.
The Alcohol Inventory Invoice Factoring process
Invoice factoring gets referred to as ‘receivable factoring’ and ‘accounts receivable financing.’ One of the most significant advantages of working with this type of financial service is that the process is uncomplicated. Decide which factoring company you wish to do business by contacting them and speaking with a representative. If you can agree, you’ll continue to do business as usual. Instead of sending invoices to clients, they get remitted to the factoring company to process. Typically, factoring companies release funds your company within 24 hours, so you don’t have to wait for the client to pay. The factoring company then invoices and collects the invoice from the customer. Fees get paid to the factoring company each time the customer pays their invoice.
Steps for Alcohol Inventory Invoice Factoring
1. Conduct regular business operations.
2. Remit invoices to the invoice factoring company you’re working with.
3. Get an advance on your invoices within 24 hours.
4. Factoring company invoices the customer and collects payment.
5. Fees get deducted and the outstanding balance automatically deposits to the business account.
How is Alcohol Inventory Invoice Factoring different from loans?
Invoice factoring is a reliable way for companies to access lump sums of cash without negatively affecting their credit or assuming more business debt. Conventional business loans and lines of credit require strong credit or collateral to qualify. Additionally, both of these financial products make the borrower assume more financial liability with less flexible repayment terms. The application process can get lengthy and frustrating.
Invoice factoring uses the businesses most recent sales receipts to determine whether they can offer advance services. Steady sales and a decent amount of volume of credit card transactions are the aspects of the business which invoice factoring companies are most interested.
Invoice factoring companies welcome the opportunity to do business with company owners with less than perfect credit because it doesn’t matter as much when making a decision. They work quickly and often let applicants about their status within 15 minutes, saving time, worry, and stress. Invoice factoring advances come in amounts as high as $20M, helpful to fuel growth.
Explain the Invoice Factoring Agreement
A factoring agreement is a contract that contains all the terms of the advance services. Typically, this document includes how long the deal is valid for, any fees associated with the advance, as well as a volume contract.
The length of individual contracts varies based on the program. Some arrangements last for six months, others can be active for years.
Business owners interested in an invoice factoring advance may get required to sign a volume agreement as part of their contract with the invoice factoring company. Company owners get the benefit of lower rates and more considerable advance amounts. This service is advantageous for business owners who want to keep things running smoothly.
How much will an Alcohol Inventory Invoice Factoring company give me?
Some invoice factoring companies offer 70% or more for advances on billable invoices. They use the most recent company financials to decide how much they can advance to your business. Other factors include billing history and creditworthiness of clients, average sales volume, and recent sales trends.
What are Alcohol Inventory Invoice Factoring Fees?
A factoring fee is a fee paid to the invoice factoring company for advancing payments on your accounts receivables. To determine what the factoring fee is, variables including sales trends, sales volume, average ticket price, are all considered. Depending on the factoring company you do business with, they might also charge an administrative fee for managing the account and corresponding transactions.
Choosing an Invoice Factoring Partner
These days, North America gets served by numerous factoring companies. When researching which provider is best for your company, they should be willing to help you get access to the capital that you request. Further, their terms and conditions should be agreeable and helpful for stimulating growth at your company.
Invoice factoring is a viable financing solution for businesses of all sizes and across multiple industries. There are two types of invoice factoring companies: Specialist factoring and Generalist factoring.
Specialist factoring companies focus on working with companies is a specific industry or niche. By working solely with one or two categories of businesses, they provide a valued service to those who need these financial products and services.
Factoring generalists are more open to doing business with companies of different types and sizes instead of limiting trade to one or two industries.
Discover if Invoice Factoring helps solve your cash flow issues
If you have a steady business and a proven track record of credit card sales, invoice factoring offers quick access to the capital you need for operational growth.