Of the many challenges the owner of a staffing company faces, making payroll every week is the most critical. Customers can take 30 to even 90 days to pay their invoices, but employees must be paid every Friday. When a staffing company is growing this becomes an even bigger issue. Many staffing companies take advantage of using a factoring company.
Factoring companies provide the working capital a staffing agency requires to grow and be successful. The process is simple, the staffing agency sells their invoices to the factoring company for cash. Each week the staffing agency gathers their employee timesheets; invoices their customer, and then sells the invoices to their factoring company. The factoring company will advance 85% to 95% of the invoice. The remaining balance will be refunded to the staffing company once the invoice is paid, less a nominal fee for factoring.
In addition to providing critical working capital for the staffing company, a top rated factoring company will also provide important backroom services of running credit checks and assist in collecting past due invoices. Having an experienced team of professionals performing these important duties has helped many new staffing agencies minimize any bad debt loss.
American Receivable has a 43 year track record of helping staffing companies grow their business. ARC is owned and managed by the original founders. As fellow entrepreneurs we understand the risks and challenges that must be conquered for a business to succeed. For eight years we have been a Top-Rated Factoring Company, always maintaining a 5 star google review. Call us today at 800-297-6652 or schedule an appointment to learn how accounts receivable factoring improves small business cash flow. In the DFW area, call 972-404-4726. To find out how invoice factoring can help get your small business off the ground, call Jack Stieber or Brad Gurney or complete our quick application form.