We live and work in a data-driven economy where business transactions take place in the blink of an eye. Yet despite the rate at which we do business, companies in every industry are experiencing sluggish cash flow due to staggered payment schedules. Fortunately, there is a solution to accelerate the rate of cash flow for your business.
Payment Schedules and Cash Flow
As technology gets better, the rate at which we do business gets faster. However, some standard business practices remain the same. Wall Street and major banks operate on the same schedules, and businesses still issue invoices with staggered payment schedules. These schedules are designed to benefit both businesses and their clients. When businesses issue invoices with payment schedules of 30, 60, or even 90 days, clients get a grace period in which to gather the capital necessary to pay off the balance. For businesses, staggered payment schedules are supposed to create a constant flow of revenue. In reality, staggered payment schedules can create cash flow issues and even long gaps without any revenue, especially for new and small businesses. Even if a business is waiting a month or more to receive payments from clients, it still has to pay employees and cover overhead expenses. Short-term loans are not the best solutions because adding debt to the balance sheet can further impact finances, especially if lag in customer payments is a recurring issue.
Eliminate the Wait
While standard business practices are not going to change anytime soon, there is a way to boost cash flow and accelerate the rate at which revenue comes into your company. Accounts receivable factoring allows businesses to leverage unpaid client invoices for cash. This boosts cash flow for businesses and reduces the need for short-term loans. As a matter of fact, accounts receivable factoring is not a loan at all, so businesses can avoid debt and preserve their credit ratings. Why wait on staggered payment schedules when you can use factoring to turn your receivables into cash and access funds within 24 hours? New Century Financial provides businesses across all industries with factoring services to boost their cash flow and ensure long-term success. Contact our offices today to accelerate your cash flow.