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COMMERCIAL FACTORING What it can do for you and your business…

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Presentation on theme: "COMMERCIAL FACTORING What it can do for you and your business…"— Presentation transcript:

1 COMMERCIAL FACTORING What it can do for you and your business…

2 WHAT IS FACTORING? In a factoring arrangement, a company sells its receivables to another company referred to as “the factor” at a discount. The Client receives money usually in hours after submitting the invoice. The factoring company provides the credit checks, collection of the invoice and any necessary accounting procedures for the account receivable.

3 What are accounts receivables? Accounts Receivable are unpaid invoices owed to you by your customers. The total of all your accounts is listed as a current asset on your balance sheet. Invoices are created when a service is performed, or a product is accepted by your customer.

4 How Can Factoring Help My Business? Provides needed working capital. Helps your company grow faster without creating huge debt from lenders. Allows for the purchase of needed supplies and materials. Helps meet payroll demands. Provides Basic Operating Cash.

5 How does it work? A company bills the invoices to its customers in the usual manner, except when the invoice is created, the original is purchased by the factoring company.A company bills the invoices to its customers in the usual manner, except when the invoice is created, the original is purchased by the factoring company. Upon verification of the invoice, the factoring company advances 80% of the face value of the invoice. This usually happens within hoursUpon verification of the invoice, the factoring company advances 80% of the face value of the invoice. This usually happens within hours 10% is put in a reserve account and is returned when the invoice is paid. 10% is set aside for our fee, which is based upon your sales volume and the number of days it takes for the invoice to get paid.10% is put in a reserve account and is returned when the invoice is paid. 10% is set aside for our fee, which is based upon your sales volume and the number of days it takes for the invoice to get paid. The company can receive an additional rebate up to 6%.The company can receive an additional rebate up to 6%. The company’s customers are instructed to make payment directly to the factor instead of the company which eliminates confusion for the customerThe company’s customers are instructed to make payment directly to the factor instead of the company which eliminates confusion for the customer.

6 What does is cost? Factors charge a fee per invoice; the fee is usually based the following; a.) company’s annual sales, b.) the credit rating of the company’s customers. c.) the average dollar amount of the invoice. d.) the number of days it takes for payment to be received. e.) the amount of monthly sales sold to the factor by the client. The more sales, the better the rate. f.) the fee ranges from 4% up to 10% per invoice and is agreed upon by both parties.

7 Let Cash Flow Experts assist you in improving your bottom line!!! No long term contract is required No financials needed No additional debt is created No other collateral is required

8 Turn your Assets into Immediate Cash By taking your current invoices and factoring them into cash, you gain the ability to grow your sales and concentrate on running your company.

9 FACTOR YOUR RECEIVABLES WHY LIMIT YOUR COMPANIES GROWTH TO HALF ITS POTENTIAL? TURN YOUR COMPLETED INVOICES INTO IMMEDIATE CASH

10 You can Expand Your Business If you are a small, medium or start up business looking for the opportunity to expand and keep up with the competition, factoring is the answer. Cash Flow Experts will advance you money in hours..

11 GETTING STARTED IS EASY AS PICKING UP THE PHONE CALL US TODAY Office Cell

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