small business

Fund Your Payroll With Receivables Factoring

Business owners are constantly solving problems.  Having to improvise when a crucial shipment is delayed, rearrange work schedules when an employee is sick, and working extra hours when a project is running late.  Having enough money for the next payroll is a problem that will keep many an entrepreneur up at night. 

Count the Costs Before you Use Your Credit Card

It can be tempting to use one, or several credit cards to cover your shortfall in your payroll account.  After all, you usually get a grace period before you have to start paying interest.  However, using credit cards to finance your business can build debt quickly, putting your business at risk. Consider these costs before you use a credit card to finance your business:

  • Credit cards have high interest rates and fees.  Business credit cards typically have the highest interest rates.  If you carry a balance the interest charges will quickly rack up debt. 
  • Damage your credit score.  If your customers are slow to pay you and you miss a scheduled credit card payment it will damage your credit score.  This will lessen your chances of getting approved for a loan in the future.
  • Credit cards make it easy to go over budget.  Using credit cards can easily lead to wasteful spending.  Going overbudget at the same time your experiencing slow paying customers can be disastrous for your company.

Use Receivables Factoring as Your Payroll Solution

Businesses owners know the importance of having a reliable source of cash flow.  Slow paying customers will disrupt your cash flow, leaving you short of funds for payroll.  Many entrepreneurs have turned to receivable factoring to solve this dilemma. 

With receivable factoring, you sell your open invoices to your factoring company.  The factoring company will advance 85%-90% of your invoices, giving you plenty of cash for payroll and operating expenses.  Once your customer pays their account receivable the factoring company will refund the outstanding balance less a small discount. 

Business owners will sell their invoices on an as needed basis.  This keeps the business owner in control of how many receivables they factor and keeps their costs down.  By partnering with a factoring company, the business owner has eliminated the problem of not having enough cash for payroll and can now take on larger customers with confidence.  The best part of this solution is that receivable factoring does not create any debt for the business owner!

American Receivable is the expert at quickly funding new accounts.  Fill out our Streamlined Application to turn your Receivables into Cash!

Jack Stieber        jack@americanreceivable.com                  972-404-4726

Brad Gurney      brad@americanreceivable.com                 800-297-6652

Dakota Stieber  dakota@americanreceivable.com            512-339-5112

Voted best Invoice Factoring Company for SMBs for 2023 by Business.com

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