So, after research and negotiation you have signed your factoring agreement and your ready to start selling invoices. Before you factor your first invoice here are a few suggestions that will help you get the most out of your factor.
Customers
Your factor is laser focused on your customers. After all, it’s your customers that will be paying them. You will want to make sure your factor is aware of how long your customers take to pay, and you are aware of what factoring that invoice will cost you! Immediately inform your factor of any changes your customer makes regarding payment terms or discounts. Always get credit approval on new customers before you ship. Your factor wants to buy your invoices, but today’s economy has tightened credit across the board.
Invoices
Whether your selling one or a hundred invoices, every invoice is important to the factor. Double check that your invoices are correct. Your invoice should have customers name, contact information, purchase order number, invoice date and amount. You will want to also provide your factor with the purchase order and proof of delivery and acceptance. If an invoice becomes disputed, let your factor know immediately. We have also compiled a small list of great tips on how to ensure your small business’ financial success.
Communication
There is always a learning curve at the beginning of any relationship, and factoring is no exception. Promptly return calls from your factor, your factor wants to buy your invoices but may be hampered by simple question. Also, be sure you understand how your factor will be communicating with your customers. An overly aggressive factor can cause your best customers find a new vendor!
Remember, your factor only succeeds when you do. By keeping in mind what is important to your factor you are setting everyone up for success!
We are a Top-Rated factoring company by Business.com. For over 42 years our factoring service has helped start-ups, growth and survival mode companies succeed and become self-funding. Factoring with American Receivable gives you the ability to take new orders, make payroll, pay bills, and grow your business. Call us today at 1-800-297-6652 to find out how American Receivable can take your business to the next level. Reach out to Jack Stieber or Brad Gurney at 1-800-297-6652 or complete our quick application form.
