Staffing agencies operate in a very fast-paced industry. They source individuals to fill roles at all types of companies, ranging from general labor to highly technical fields. In order to sustain operations and grow successfully, staffing agencies need to not only cover their own expenses, but also pay those individuals working in various roles for their clients. With clients paying invoices at varying rates, there are times when cash flow can become turbulent and place a strain on finances that makes it hard to keep things running smoothly.
Striking a Balance Between Services and Revenue
Many staffing agencies have agreements with their clients to provide qualified employees for weeks, months, years, or even for a custom duration to complete a specific project. The sourced employees are paid by the staffing agency on a weekly or bi-weekly basis. On the other side, clients are issued invoices with payment schedules of 30 days or longer. This means staffing agencies are spending more to pay their employees and cover overhead costs than they are receiving at any given movement. The imbalance in the cash flow can place a strain on finances, sometimes preventing staffing agencies from making payroll, or even taking on bigger client contracts. Running a successful staffing agency means having access to a reliable and renewable source of working capital.
Improving Cash Flow
To ensure ample working capital to make payroll, cover overhead, and court larger clients, staffing agencies use accounts receivable factoring services. Instead of waiting on clients to remit payment on invoices, factoring converts those receivables to cash within 24 hours. Factoring helps to balance cash flow and smooth our revenue cycles so there are no financial strains. Sourcing highly qualified individuals for larger client contracts becomes much easier, because the capital is on hand to cover the rate of pay. Staffing agencies can also explore new markets and opportunities to expand their reach.
New Century Financial provides accounts receivable factoring services for staffing agencies throughout the United States. Our services can be tailored to fit your needs, with no hidden fees or contracts. Contact our offices today to learn more about why staffing agencies choose New Century Financial.
When businesses position themselves for growth, the thought of taking out one or more loan is not far behind. For the longest time, debt-based loans have been the answer for everything from overcoming cash flow issues to expanding into new markets. However, business owners spanning all industries are rethinking the traditional growth financing model.
The Limitations of Debt-Based Financing
Growth-focused businesses want to reach their fullest potential. Loans may seem like the conventional method to attain growth capital, but they can also be very limiting. Taking on debt to achieve growth usually means businesses have to walk back a few goals in order to pay off the balance of their loans without creating a severe financial strain. Debt and impacted credit ratings add to the risk of business growth when the end result does not guarantee a proportional increase in sales to offset financial liabilities. In the end, the accumulated debt can keep businesses from hiring the workforce they need to carry out growth projects, or the inability to meet expanded overhead costs.
Achieving Growth Without Debt
Accounts receivable factoring helps businesses position themselves for growth without having to jump through hoops or take on debt via traditional loans. At its very heart, factoring is the simple process of exchanging unpaid customer invoices for cash. The simple transaction does not place any debt on the books, and it is a fast and efficient way for businesses to improve cash flow and quickly accumulate the capital necessary to act on growth opportunities. Accounts receivable factoring has come a long way, and has become a mainstay of business financing for everything from correcting minor cash flow issues to funding large projects without negatively impacting credit ratings or taking on debt. Businesses can now choose which invoices to submit for factoring, and even which parts of invoices, without any contracts, limits, or hidden fees. Accounts receivable factoring is used in every industry from niche startups to major corporations.
New Century Financial is recognized as a leader for providing comprehensive accounts receivable factoring services and tailoring solutions to meet the needs of business owners. Contact our offices today to learn how our factoring services can help your business achieve growth and long-term success.
Manufacturers of all types are facing increased demands from their clients. Whether it is ductwork for HVAC installations, specialized electronics, widgets, or finished products for general consumer use, production expenses are on the rise. Manufacturers need a robust cash flow to purchase raw materials, acquire or maintain equipment, and hire employees to ensure operations run smoothly. When clients are settling accounts at intervals of 30 days or longer, this can disrupt the normal workflow for manufacturers. Fortunately, there is a simple solution.
Filling Customer Orders
Many manufacturers receive orders at a faster rate than they are paid by their customers. On the surface, this is not bad. Making a lot of sales or taking on long-term clients is very good, and can potentially position a manufacturing company for growth very quickly. The issue arises with the rate at which revenue comes into the company. The standard business practice is to issue invoices with to customers with staggered schedules ranging from 30 to 90 days. If revenue is trickling in every month or so, that can place a strain on finances, resulting in the inability to purchase materials or worse – not making payroll. In many cases, manufacturers will turn to short-term loans, but even that is not a wise solution for a recurring issue. Taking on debt and impacting business credit ratings can land manufacturers in a much tighter financial situation, especially if there are other cash flow issues.
A Debt-Free Solution for Manufacturers
Manufacturers need to achieve greater parity between orders placed and payments on invoices. To do this, manufacturers use accounts receivable factoring. Accounts receivable factoring allows manufacturers to submit unpaid invoices, or even parts of invoices, and have them converted to cash within 24 hours. This eliminates the long waiting period created by staggered payment schedules. Additionally, manufacturers can improve cash flow, reduce the need for debt-based financing, and accumulate the capital necessary to take on large and unexpected orders. Materials, equipment, payroll, and more can easily be covered without experiencing a strain on finances.
At New Century Financial, we specialize in accounts receivable factoring for manufacturers of all types. Contact our offices today to get started.
For new and small businesses, covering overhead costs while trying to grow operations can be a challenge. Payroll, utilities, advertising, fuel for vehicle, materials and supplies – all of these things can place a strain on finances, especially when business owners are trying to court larger client accounts and act on growth opportunities.
Understanding Costs and Growth
Every business has overhead costs. Sometimes those costs are only limited to paying employees and purchasing supplies to fill customer requests as needed. When businesses are trying to position themselves for growth, the costs can increase for marketing campaigns, spots at trade shows and expositions, and rolling out new products and services. These costs can eat into revenue and stretch finances to the limit.
The Importance of a Healthy Cash Flow
In order for businesses to grow, a healthy cash flow is needed to not only cover costs, but to accumulate capital reserves as well. Many businesses do not receive immediate payment with each sale or customer order. Most adhere to staggered payment schedules of 30 days or more, depending on the type of business. The waiting period can place an even greater strain on finances, and force businesses to put off growth projects and deviate from their projected plans. Maintaining a healthy cash flow allows businesses to grow without having to resort to debt-based loans, which further impact revenue.
A Solution for Overhead and Growth
Accounts receivable factoring allows businesses to convert invoices to cash without waiting on long payment schedules. By using accounts receivable factoring, businesses can cover overhead expenses, while also positioning themselves for growth without the burden of debt. Factoring services are fast, efficient, and reduce financial strains for businesses. Payroll, supplies, marketing, travel, and more can easily be covered without having to wait a month or longer to receive payments. Factoring services are the key to a healthy cash flow and rapid business growth.
New Century Financial specializes in accounts receivable factoring for businesses throughout the United States. Contact our offices today to put your business on the fast track for growth and long-term success.