One of the advantages of invoice financing is that most transactions are not structured as loans. Instead, the client sells their accounts receivable to the finance company in exchange for an immediate payment. This article describes how a company sells their invoices to a finance and covers the following subjects: 1. Invoice financing basics Invoice […]
Blog
How to Find Clients for a Labour Hire Agency (12 Ways)
One of the skills needed to run a labour hire agency is knowing how to find and get profitable clients. The Australian labour hire market is very competitive. Many labour hire and recruitment agencies are often chasing the same contracts. To succeed, you must know where to find these opportunities – and how to get […]
Cash Conversion Cycle Calculator
The cash conversion cycle, also known as the working capital cycle, measures how long it takes your business to sell inventory, collect invoices, and pay suppliers. It’s an important metric because it shows how efficiently your business turns operating activity into cash. An increasing cash conversion cycle may indicate that cash is tied up for […]
Inventory Days Calculator
Inventory days, also known as Days Inventory Outstanding (DIO), measures how long your business holds stock before it is sold or used, on average. It’s an important metric because it provides a general gauge of your stock management efficiency. An increasing inventory days figure may indicate slow-moving stock, excess inventory, or potential cash flow problems. […]
Debtor Days Calculator
Debtor days, also known as days sales outstanding (DSO), measures how long your customers take to pay their invoices, on average. It is an important metric because it provides a general gauge of your collections performance. An increase in debtor days may indicate collection delays and potential cash flow issues. Formula: Debtor Days = (Average […]
Creditor Days Calculator
Creditor days, also known as days payable outstanding (DPO), measures how long your business takes to pay its suppliers, on average. It’s an important metric because it provides a general gauge of how your business manages supplier payments and cash flow. An increasing creditor days figure may indicate that your business is taking longer to […]
Debtor Finance Interest Rates
Summary: This article provides an overview of the typical financing rates for the two leading debtor finance products. It explains how debtor financing companies determine your rates and how those rates are applied in a transaction. We cover the following information: If you are not familiar with debtor financing, read “What is Debtor Financing?” to […]
How Does Debtor Finance Work?
Summary: Debtor financing is an umbrella term for products that finance accounts receivable. It’s typically used when referring to invoice financing or invoice discounting. Invoice financing, also known as invoice factoring, is suitable for small and medium enterprises (SME). On the other hand, invoice discounting is suitable for larger companies with an established track record. […]
How are Invoice Verifications Done?
Summary: Debtor finance companies can finance an invoice only after it has been verified. This article helps you understand why invoices are verified and how the process works. We cover the following: What is debtor finance? How are invoices verified? How are problem invoices handled? 1. Understanding debtor finance Debtor finance, also known as invoice […]
Debtor Financing v. Overdrafts
Summary: Small companies that experience short-term cash flow problems often have few alternatives. Their available options often include getting funds from investors, a business loan, an overdraft facility or using a debtor financing programme. In this article, we compare debtor financing to an overdraft facility to help you determine which one is better for your […]