Other News & Stories

When Does Invoice Factoring Make Sense?

View of an invoice form from a man's laptop screenInvoice factoring is a financial transaction that turns your receivables into real dollars in no time. Unlike accounts receivable financing, the factoring company would buy your outstanding invoices in this deal. It may not always be suitable for all financial situations, but it’s one of the better ones in terms of value and convenience.

When should you turn to an invoice factoring firm? Here’s when it makes absolute sense:

You Have Creditworthy Customers

TAB Bank shares that one of the qualifications for online invoice factoring is customer creditworthiness. If the suppliers that owe you money have a good history of paying bills, you can get the most money because the other party would feel confident purchasing your unpaid invoices.

You Need to Expand Your Working Capital Immediately

Unlike traditional commercial loans, invoice factoring offers a speedy and straightforward process. You can receive the funds in a matter of days. The approval of business loan applications takes a while because borrowers come under scrutiny. If you need the money ASAP, you can increase your liquid assets without building an excellent credit rating first.

You Want to Use the Money Without Restrictions

You can use the invoice financing proceeds in whichever way you want. There’s no need to come up with an elaborate presentation about how you intend to spend the money. The invoice factoring company only cares about how fast your customers can pay it. Your spending choices are entirely your own business.

You Like to Avoid Debt Collection

Debt collection can strain the years of business relationships you’ve built with your suppliers. Debt collectors are notorious for relentless contact attempts, which might antagonize your customers.

On the other hand, factoring companies don’t do anything that might cause debtors to ignore their financial obligations. If they frustrate debtors, they will suffer because they would solely absorb the losses from non-payment.

Invoice factoring is a smart way to rid your company of receivable. Do your due diligence to find a reliable factoring firm you can quickly deal with.

April 17, 2018 at 4:32 pmMind of Money

Forget ‘Unique’: Market What Makes Your Brand Different

Brand concept shot

Is it still possible for a business to be marketed as ‘unique’? In a market where every start-up company has the latest, the brightest idea that can change the world, how do you make your brand stand out? The secret is advertising what makes you different. The keywords are ‘advertising’ and ‘different’.

Here are some tricks to help you:

Embrace Local

So you’re a local company. All the employees are residents of Melbourne, and you are sourcing ingredients from the neighbourhood. None of the imported stuff. Is that a bad thing? Not if you and your SEO consultants market it the right way. Rather than belittle what is seen locally, talk about how you are helping the community and the environment by minimising the consumption of fuel.

Have a Stand

Customers these days are all for supporting causes that are close to their heart. If you express your love for the environment or openly support charities, that can work well for business. Follow the lead of shoe brand TOMS, which donates a pair of shoes to those in need for every pair that customers buy. Major coffee shop franchises also support various causes, which they talk about in their yearly planners. You could talk about your chosen cause in a press release or on a blog post.

Give Back

The cause you support in your business could be in other locations, but that does not mean you should ignore your local community. You are embracing local, remember? Sponsor local events and be an active part of the community. Participate in clean-ups and cleanliness drives. Donate old clothes. The options are endless, but you do not have to participate in all of them. Choose a cause that is in line with your brand’s mission and vision.

There are plenty of ways to market your business. The most favourable one is the one that takes advantage of what you have to offer that enriches the lives of your customers.

April 2, 2018 at 6:05 amThe Marketing Section

The Truth You Need to Know About Small Business Lending

money on a clipboardThe face of small business financing has undoubtedly changed over the years. Nowadays, small business owners can have an average debt load of $195,000. They also have a higher average credit limit amounting to $56,100.

This doesn’t automatically mean, however, that all small for-profit organizations have secured loans or credit lines that big. In fact, many of them continue to apply for financing services, although some have undergone the frustrating and emotionally-toiling experience of receiving a rejection.

As one of the 2.1 million small businesses in New York, what can you do to minimize financing risks?

Explore all possible financing options

Applying for a traditional business loan is one of the most effective strategies to acquire financing, but some are still skeptical about it. The good news is there are alternatives.

A good example is inventory-based loans (also known as inventory financing). This asset-based lending system gives your business a higher chance of getting an approval since you’ll be using your inventory as collateral. Through it, you’re secured to have a revolving line of credit. You’ll be able to keep product supply in safe quantities, which means more opportunities to make sales and gain steady profit.

There are several other uses for inventory loans, such as backing you up in case of a sudden emergency expense or in case you need to manage seasonal limited cash flows.

Start improving your credit

One of the biggest reasons business owners get a loan rejection letter is their lack of creditworthiness. This factor can make all the difference when applying for a loan, as it’s a reflection of how financially responsible you are. Lenders want and need borrowers like you, but they also have to ensure that they can get their money back. Before applying, make sure you have a good credit.

As early as now, find the most suitable loan for your business and start building and improving your credit. This way, you can grow your list of potential funding sources further and find it easier to acquire them.

March 29, 2018 at 1:00 amMind of Money