Software development companies can be very profitable businesses but are also cash-flow intensive. This challenge must be managed correctly to avoid cash flow problems that could affect the viability of the business. This article discusses two techniques Canadian software developers can use to address this issue. We cover: Revenues vs. costs Discounts for early payments […]
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How to Finance a Building Products Distributor
Working with builders and general contractors (GCs) has advantages. They are often recurring customers who place larger orders and can help grow your business. However, these customers usually ask for net-30-day payment terms. This request is a challenge because offering payment terms can lead to cash flow problems if not handled correctly. This article presents […]
How to Finance a Consulting Firm
Most consulting companies are launched with very little capital and few assets. They usually do not have a substantial cash reserve. The company operates month-to-month, using incoming revenues to cover expenses. This approach can work for small companies. However, it can create financial problems if your company is growing. This article discusses how to handle […]
Should You Factor Invoices That Are Collections Problems?
Factoring companies often get calls from prospective clients interested in factoring invoices that are hard to collect. These invoices tend to be substantially past due and have become collections problems. The prospect hopes that the factor will buy the invoice and take on the collection problem. Past-due invoices that have become collections problems cannot be […]
What is Purchase Order Financing?
Summary: Purchase order financing helps small companies that have won a large order and need funds to pay their suppliers. The solution helps cover the vendor expenses, enabling you to fulfill the order and book the revenue. PO funding has grown in popularity with Canadian resellers and distributors as a tool to grow their companies. […]
How to Finance an Office Cleaning Company
Managing the working capital of a small and growing office cleaning company can be difficult. The company usually has to pay its regular expenses before it gets paid by clients. This payment delay can lead to financial problems. This article discusses two techniques to improve your cash flow and financial stability. We cover: Slow-paying clients […]
Can an Invoice be Factored Before Delivery?
Every so often, clients want to factor an invoice that has not yet been fulfilled. Basically, the invoice is for work that is about to begin or products that will be delivered soon. These invoices are commonly referred to as pre-delivery invoices. Unfortunately, these invoices cannot be factored. This article explains why factoring companies cannot […]
The Importance of the Accounts Receivable Aging Report
The Accounts Receivable (A/R) Aging report is a critical tool for managing your business. This is why most lenders and factoring companies request this report as part of their due diligence process. Unfortunately, it’s one of the most valuable yet underutilized reports. This article helps you understand the value and uses of the A/R Aging […]
Why Can’t You Factor Net-90 Invoices?
Every so often, a client may want to factor an invoice that is due in 90 days or more. These types of invoices become more common during difficult economic times. Unfortunately, some larger companies are permanently moving their payment terms to net-90 and beyond for all suppliers. This time frame may help the larger company’s […]
Why do Staffing Agencies Get Higher Factoring Advances?
Most factoring companies advertise that they provide an advance of 80% to 90% of the invoice, depending on the client’s industry. For example, a manufacturing company with solid clients will likely get an advance of 80% to 85%. On the other hand, a staffing agency with similar clients will get a 90% advance. This variation […]