Invoice financing is a general term that applies to several products that allow you to finance accounts receivable. The two most-used solutions are factoring and sales ledger financing. In this article, we discuss both solutions in detail. The article covers: 1. Quick Summary Factoring allows your company to sell its invoices to improve your cash […]
Asset Based Lending
Inventory Financing vs. Accounts Receivable Factoring
Summary: Invoice factoring allows companies to improve cash flow by leveraging their accounts receivable. Inventory financing, on the other hand, enables companies to leverage the funds tied to their inventory. However, most small business owners misunderstand each solution’s role in their company. This misunderstanding often leads to expensive mistakes. Invoice factoring is more flexible and […]
How Does Inventory Financing Work?
Inventory financing is a form of asset based lending that allows you to leverage your inventory. This can help improve your company’s cash flow and provide funds to pay for business expenses, or to purchase additional inventory. This type of financing is useful if you are unable to get higher credit terms from suppliers/vendors, or […]
How to Finance Accounts Receivable and Inventory
Summary: Companies that finance their accounts receivables typically do so because they can’t afford to wait up to 60 days to get paid by their clients. Financing their receivables solves this problem and allows them to improve cash flow quickly. On the other hand, companies that look for inventory financing are trying to solve a […]
Asset-Based Lending Basics
Summary: Asset-based lending is a type of financing that allows a company to leverage its assets. It provides revolving lines of credit and term loans depending on the assets used as collateral. Asset-based lending is common among smaller middle-market companies that need a solution with flexible covenants. This article provides an overview of asset-based financing […]
Using PO Financing with Asset Based Lending
Generally, companies don’t use purchase order financing as a stand-alone product. Instead, they combine it with another financing solution, such as factoring. The reason both products are used together is that combining them often reduces total transaction costs. These savings benefit the client and drop directly to the bottom line. The purchase order financing line is used to pay […]
How to Select the Best Asset Based Lending Company
Selecting the right asset based financing company is one of the most important decisions you can make for your business. Your evaluation process must be designed to ensure you choose the best asset based lender to fit your tactical and strategic financing needs. This article describes a short process to help you evaluate potential lenders. If you are not […]
Eight Advantages of Asset-Based Loans (ABLs)
Asset-based loans (ABLs) are used by small and middle-market businesses to improve liquidity and finance new projects. They offer similar advantages to conventional solutions. However, they are more flexible and have simpler qualification requirements. This article discusses the eight important benefits of asset-based loans. To learn more about asset-based loans, read “What is Asset-Based Lending?“ […]
Invoice Verifications in Asset Based Loans
Asset based lenders may perform invoice verifications as part of managing the borrowing base of a client. Invoice verifications allow the lender to confirm that the invoices used for the borrowing base are accurate and free of disputes. Clients are often concerned about the verification process because the asset based lending company interacts directly with their customers. […]
What Is an Asset-Based Loan (ABL)? How Does it Work?
Summary: An asset-based loan (ABL) is a type of business financing secured by a company’s assets. This financing improves liquidity and can be used to cover expenses or to invest in company growth. Asset-based loans can be structured as a term loan, revolving line, or a combination of both. The loan structure depends on the […]