Are we right or wrong? We have always maintained that knowing something others don’t in business gives you an advantage, and we think you’ll see that advantage when we tell you about a confidential factoring program that works and why this type of invoice finance puts you head and shoulders above your competition.
You probably have heard that thousands of Canadian firms have moved to invoice discounting as their primary finance vehicle. Unfortunately misinformation about this type of financing is everywhere, and we’ll show you how the advantages of receivable financing can be put to work immediately.
The real power of confidential invoice financing is the fact that you have the ability to bill and collect your own receivables. 99.9% of your competition won’t be able to do this, and it is that stigma along with their suppliers, employees, etc that your competitors can’t overcome.
Invoice financing works because as you grow your company the collection of cash doesn’t, unfortunately, match the amount of sales you are generating. Those customers of yours continue to pay you in 30, 60, and 90 days… like it or not.
Naturally we tell our clients they have the option of restricting their customer’s credit, holding shipments, and enforcing a strict collection policy – as you can imagine that is not their preferred solution – which is more often than not to extend more credit and be patient with their customers.
If you have an operating line of credit from a bank you could generally fund this working capital at a pretty decent cost – unfortunately small and medium sized business in Canada can’t always access this type of credit.
Enter a confidential factoring receivable and invoice finance program! When you utilize this type of financing you are generating all the short term borrowing you need, and, more importantly, you have the ability, unlike those competitors of yours to bill and collect your own receivables. Most receivable financing in Canada is actually done on a full notification basis – it works, but we don’t like it, because it involves notifying our clients, employees, etc as to how your firm is being financing. We prefer that to be our clients business, not the entire marketplace!
When you use confidential invoice financing you receive approx 90% of the invoice amount the day you generate the invoice. The balance is simply held back and remitted to you when your customer pays you – less the financing charges.
And hey, what about those financing charges – aren’t they high? We have some strong opinions on that, mainly due to misinformation that abounds on the cost of factoring. Confidential invoice factoring costs the same as regular financing in this manner, and we point out to clients that the charge is not dissimilar to carrying those accounts receivable for 60-90 days on your books. And making using of that cash to generate further sales and profits, enhance relationships with suppliers, etc, is a key benefit of this financing.
Speak to a trusted, credible and experienced Canadian business financing advisor and learn how you can take a unique competitive lead via a confidential invoice finance program.
Stan Prokop – founder of 7 Park Avenue Financial –