Debtor Finance, Factoring, Invoice Discounting has often been misinterpreted and misused. These finance products were never designed to send a business owner broke.
Most Accountants support Factoring when used correctly.
Debtor Finance, Factoring, Invoice Discounting has often been misinterpreted and misused. These finance products were never designed to send a business owner broke. However, if misused as they have been in the last 20 years. Often the costs of these products has been taken off the profit line, eating away at any chance of the business succeeding. Clients have also been locked in for 12-24 months with the wrong product. Continue reading “Most Accountants support Factoring when used correctly.”
Why would you want to pay more money to finance invoices. Most business owners need cash flow. Unfortunately as more and more sales go out the door. As a result more and more pressure is placed on cash assets to purchase more stock.
Trade Debtor Finance will list some of the main reasons, businesses can use factoring.
This product is used to take pressures of you cash at hand. Most business owners rely heavily in the first year of business fast payments in order to keep stock levels and sales revolving fast. Therefore by funding unpaid invoices you will have access to funds before payment. Having funds to purchase more stock gives your company the abilty to flood the market. The costs can be off setted by paying cash or discount purchasing. Plus the fact your sales will increase and income generated in growth. ____________________________________________
Star up business or sole traders often are owned by families. As these businesses grow, often funds are directed towards sales. The strain on paperwork, admin, is often an extra job. You can if you can afford it hire a person to help out! Hence Factoring companies has advantages by helping your companies back end. They verify invoices, make collection plans and provide paper trails. Also lenders provide you with cash flow, which could give you funds to hire more staff. ____________________________________________
Funding with factoring can turn around your business. Owners can purchase a business, and use its unpaid invoices to fund its operations. While you use your monies for improvements. Funding invoices can give you the ability purchase more staff, vehicles, and better equipment. This products expenses is claimed on Tax. ____________________________________________
This is why you Choose Trade Debtor Finance Consultants.
Our family owned and operated business helps businesses Australia wide. Consultants take the time to time to explain all products and lenders in great detail. Best of all TDFC places this in an obligation free written quote. This quote will have up to four options to choose from. Don’t guess, make that one call. 1300 00 8332
What is Debtor Finance, Full Service Factoring, or Invoice Discounting?
These facilities are when a business sells all or part of their debtors’ ledger (Unpaid Invoices) to a financier. Owners raise working capital (Cash) for expenses, wages or fuel.
How does debtor-finance / factoring work?
As a result of business delivering its goods/services to its customers, the invoices (trade debts) raised can be sold to a factoring financier.
Most Factoring Financiers can advance up to 80% of the unpaid invoices value. This occurs within 24-48 hours of verification. Therefore the remaining 20% is advanced after the invoice is paid from the client to the lender. Business owners are returned the final 20% less a small fee of about 1-3%.
So the business simply forwards copies of the invoices to the Factoring financier. Once verification of invoices is complete funds are advanced.
The businesses can retain control over accounting functions and collections. They may also opt for the Factoring financier to control this function. In our experience, its wise for your firm to retain the account functions.
What are the benefits of debtor-finance / factoring to a small business?
Consequently funds are readily available. Credit sales are converted into cash normally within 48 hours.
With cash in the bank, the client can negotiate better trading terms with suppliers. They can also ascertain an early settlement, discounts and the ability to buy in bulk.
Eliminate the need to offer settlement discounts to customers. Invoice-Discounting fees are usually cheaper than settlement discounts. With Invoice-Finance clients knows with certainty when they will receive cash.
What are the costs?
Hence different Factoring lenders charge different fees. Lenders base this upon setup structure, size and risk. The average cost of debtor-finance is 3% per month. This will vary depending on your debtors payment terms. The longer it takes for debtors to pay, as a result, the higher the cost.
Why Choose the Trade Debtor Finance Consultants?
Cost: Our firm has no direct upfront fee for our consultation. Confidential: TDFC will not sell your information to a third party. Choice: Our family owned business has access to over 28 trustworthy debtor-finance lenders. Experienced: TDFC consultants have expert experience in debtor-finance and know what lenders to recommend for your business needs Trust: Our policies dictate that you with be given no nonsense answers and will explain all costs Successful: TDFC can give you recent successful client referrals.
Find a facility for your business in your industry
Debt is a common issue for new businesses, usually incurred by startups in the early stages of their growth, and it can become a problem if you’re not familiar with debt management options. We’re taking a closer look at how debtor finance can help new businesses.
The most experienced people in the construction industry will tell you that success is based on managing your money in order to provide quality work at high speeds. Even thriving construction businesses can hit rough financial patches when invoices aren’t paid on time. Knowing how to manage those problems is crucial, and having the right assistance will help your business grow.
Trade Debtor Finance Consultants Pty Ltd (TDFC) has been providing expert help with Factoring and Invoice Discounting products for the last 10 years. TDFC has settled over 300 factoring deals in that time. Consultants have seen almost every industry and type of business there is. Also in that time, we have established connections with the very best lenders in the country.
With one call a consultant will help you understand the factoring product. Therefore help you understand the pricing and products. Consultants explain the dos and don’ts and help you make a plan going forward into the future.
Use Debtor Finance to improve cash flow
Factoring is a lethal product if used the wrong way and can single handed ruin a business. However, if used correctly and a steady plan is made, then this product can help your business grow with minimal security offered.
TDFC want you to better understand the products, the lenders, and the pricing. We stand behind this by offering it in writing to your firm with recommendations and why we chose those lenders.
Trade Debtor Finance Consultants will help you in one call.
TDFC is family owned business which started in 2007. Once we have all the information required, we offer a quote. This quote is obligation free, written and provides up to four factoring options that suit your business needs. Lenders cut to the chase an offer the best pricing for your needs. TDFC consultants stand by their choice and offer support for the life of the loan at no charge.
For more information you can go to your website, www.tradedebtorfinance.com.au or contact us today by 1300 00 8332. You can also email your inquiry firstname.lastname@example.org
The classic story in the agricultural sector is a tale of how much money is available at any time. Funds are necessary for equipment, stock, crops and much more, so one bad year (or several) can do irreparable damage to cash flow. Anyone who works on the land will tell you to keep debt under strict control at all times. All it takes is one unforeseen expense and you can find yourself with a lack of cash and bills piling up.
Most business owners need a cash flow injection to help secure more business growth. How do we get such finance, is the best question. If you have debtors that have accounts which are 14 days or more, then you can ascertain finance. Instead of waiting to the debtor pays his account, lenders will finance a part of the invoice allowing you access to funds within 48 hours.
Accountants and planners utilise all sorts of funding, secured by the owners. this is often the cheapest form of finance, but also the most secured. This is also very stressful as one lender has complete control of your business.
For years now TDFC has been helping people on their journey in their business. On the journey people can come across troubles that they may not know there is a solution for. Your debtors taking months to pay, chasing unpaid invoices or cash going out faster then it is coming in can be stressful. Problems can cause you to move slower and leave you feeling like your not where you want to be.
Christmas is a busy time for most businesses. Business owners however, still have wages to pay, debtors to maintain, and often the business world shuts for a week or so.
Improve your business Cashflow with Factoring. Get monies advanced on those invoices upfront. Therefore this will help you cover those fuel bills, those wages, and basically get over the period. This Cashflow with get your funds moving for you.