Staffing company owners know that happiness is positive cash flow. But there are times when entrepreneurs are caught in a cash crunch. The long-term fix is to do a detailed examination of every expense, analyze pricing and investigate raising additional capital. This process will take time but won’t help you meet payroll by Friday. Every business owner knows what to do next, drop everything and start dialing for dollars! In a frantic effort to get money in the bank. The company starts contacting customers to coax them to quickly pay their invoices. While this is one way to get cash to meet immediate expenses, the owner’s customers may be wondering about the strength of their vendor.
Having a simple but strict invoice policy in place will greatly reduce the time it takes your customers to pay their outstanding invoices. First, run a business credit report on your customer before agreeing to offer them terms. Your need to make sure that your new customer has a strong history of paying their bills in a timely manner.
Then double check that your invoices are being emailed to the correct address, and you are receiving the correct approvals from your customer for each invoice. Also confirm your customer agrees to your payment terms. Have someone from your company contact your customer several days before payment is due to verify that your invoice is in line for payment.
Many staffing agencies already follow this protocol but find that they still are having cash flow issues. A good solution is use invoice factoring. With a good invoice factoring company on their side staffing companies can take on additional customers with confidence, know that their factoring company will assist them to always make payroll!
For 43 years American Receivable has helped staffing agencies grow and prosper with our tailored factoring program. ARC remains owned and operated by the original founders. Prospects never pay an application fee and are qualified on the credit strength of their customers, not their credit. Our clients save time and money letting ARC run credit checks on their customers and assist with collections. Unlike bank owned factoring companies that makes their decision based on your personal credit score and sets a credit limit on your business. Our sales and administrative staff all have strong backgrounds in finance and customer service. This ensures our clients that even day to day transactions are handled to benefit our client. American Receivable’s longevity is based on our client’s success.
Schedule a conversation to learn more how American Receivable will provide the cash you need to thrive.