How businesses can use factoring to fuel growth
Businesses can use factoring to fuel growth. As a small business owner, you probably already understand the benefits of invoice factoring when it comes to easing your cash flow. But factoring is more than just a temporary financial stopgap. Careful use of invoice factoring can actually help you fuel the growth of your business.
Better credit control
Firstly, invoice factoring allows you to put your finances on a solid footing. It does this by freeing up cash for vital business spending and improving your credit control. By handing all your credit control functions over to the factoring company, it frees up both time and money for your business. Not only do you receive an instant cash injection, but you also have more time to dedicate to productive, operational work rather than wasting resources chasing after payments.
More available working capital
Most importantly, invoice factoring makes working capital available to you at crucial moments. Sometimes you need to take big steps to move your company forward and upward. To do this, you need to have cash at your disposal. Whether it is moving your business to a bigger space or purchasing new machinery, your company needs to make periodic investments in its future growth. These purchases cannot be made without working capital. This holds your company back from reaching its full potential. By selling your receivable invoices, you can free up the capital you need to take those crucial steps.
In addition to these benefits, it is also much easier to qualify for invoice factoring than conventional loans. And there are no financial covenants.
Kore Capital Corporation is a business financing company that specializes in offering lines of credit, particularly through factoring, to firms in several different industries. For more information on invoice factoring, contact us.