Commerce seems to move faster all the time, but even businesses that do well in sales would like to find new methods in receiving revenue from customer invoices to move faster with short pay invoices. Fortunately, there is a time-proven method that speeds up customer invoice payments.
Dissecting Staggered Payment Schedules for Invoices
To understand where the lag in revenue occurs, we need to look at staggered payment schedules. While there are some businesses that operate on point-of-sale systems where payments are made immediately, many do not.
Several Industries including manufacturers, transportation companies, law firms, construction businesses, service businesses, staffing firms, and more all issue invoices to their customers. Those invoices still adhere to business standards that have been in place for a very long time. Invoices are issued with staggered payment schedules that can range anywhere from 30 days to 90 days. This is to benefit customers by giving them a window in which to pay for their goods and services.
What is Staggered Payment and How Staggered Invoice Payments Impact Businesses
While staggered payment schedules are good for customers, they can create financial strains for businesses. Waiting 30 days or longer creates gaps in revenue, and businesses still have to make payroll, purchase supplies and inventory to fill new orders, and cover overhead.
This can force businesses to rely on short-term loans to smooth over uneven revenue cycles. However, those short-term loans place debt on the balance sheet, and can impact cash flow even further.
Accelerating Cash Flow with Accounts Receivable Factoring
While there is no way to make customers pay faster, there is a way to accelerate revenue and eliminate staggered payment schedules. Accounts receivable factoring from New Century Financial allows businesses to take their unpaid customer invoices and convert them into cash within 24 hours.
There is no need to suffer through staggered payment schedules, financial strains, or short-term loans when you can accelerate cash flow by turning customer invoices into immediate revenue.
If you are tired of staggered payment schedules and want to accelerate cash flow, contact the team at New Century Financial today. We will work with you to create a factoring strategy tailored to your cash flow needs.