Selasa, 28 Februari 2017

Working Capital Solutions With Factoring

Ideal Candidates for Accounts Receivable Factoring:

Any business that provides a product or service to other creditworthy businesses and is constrained by their day-to-day cash flow situation.

Does your business need:

• Cash to Cover Payroll?

• Working Capital to Fuel Growth?

• Help with Cash Flow Problems?

• Help because of Bank Turn Downs or refusal to extend current lines?

• New Equipment to Grow?

What is factoring?

In a traditional factoring arrangement, a company actually sells its receivables to another company (a “factor”) at a discount. After the sale, the receivables balances are carried on the factor’s balance sheet since title has passed. Because the factor then owns the receivables, it generally provides all the required credit, collection and accounting services necessary to collect the receivables, including assumption of the ultimate loss exposure from the client debtor. The important difference between factoring and asset-based lending is ownership. In factoring, the receivables are purchased and owned by the factor. In asset-based lending arrangements, accounts receivable are pledged to the lender as security for the loan, but the borrower retains ownership and complete control of the receivables and the value of the receivables remains on the borrower’s financial statement.

Keeping the cash flowing is a challenge for all businesses. Does your company face cash flow challenges because of slow paying customers? Have you been forced to decline new opportunities because of cash flow issues?

As every business owner knows, sales alone do not measure the profitability of a company. For example, sales may be increasing, but a company may have to wait weeks or even months for payment. During that time, your company cannot purchase materials for more orders, meet payroll, or other basic operating expenses. The solutions may be Accounts Receivable Funding provided through Diversified Funding Services, Inc. Accounts Receivable Funding is quickly becoming a popular choice for its flexibility and rapid injection of needed capital.

Why Accounts Receivable Funding is a Popular Choice in Today’s Business World

Accounts Receivable Funding or “factoring” has been in existence for several decades. Today, virtually any-sized business that extends credit to other businesses for goods or services can enjoy the many benefits of Accounts Receivable Funding.

Simply stated, Account Receivable Funding is the exchange of creditworthy commercial accounts receivable for an immediate injection of working capital. When an invoice is generated, it may be purchased with an advance of anywhere between 75 to 90% of the net invoice amount. When your customer pays the invoice, you will receive the reserve portion minus a nominal servicing fee.

Why Accounts Receivable Funding Makes Financial Sense

Accounts Receivable Funding offers many Advantages:

• Initial funding is typically available between 5-7 business days upon receipt of completed formal agreements, and then all future advances are funded within 24 hours.

• Accounts Receivable Funding does not create a financial liability on your company’s balance sheet and generally no other collateral (outside of the receivables) is required.

• The amount of funding available to you is only limited by the creditworthiness of your customers.

• Accounts Receivable Funding focus on the creditworthiness of your clients instead of your financial history.

• Accounts Receivable Funding allows quick access to working capital, instead of waiting 30, 60 or 90 days to receive payment from your customers, money is immediately available on demand.

Accounts Receivable Funding Programs have been “generally” designed with the following criteria in mind.

• Your company must be providing a product or service to other credit worthy businesses (no consumer sales)

• Your company must be selling on terms

• Your company must be billing in arrears (no pre-billing)

• Your company must have minimum monthly sales of at least $10,000 or annual sales of $120,000

• Your company is not required to be in business for any length of time

• Your company should have the capability to generate financial reports (A/R and A/P aging reports, etc.)

• Your company may have current and/or historical losses or a deficit net worth position

Ideal Candidates

• Start-ups
• Companies suffering financial setbacks
• Service Companies
• Companies with seasonal orders
• Mature companies seeking cash flow support
• Companies seeking credit assistance
• Businesses experiencing rapid growth
• Non-bankable businesses

An example of the application process:

1. Complete the application
2. Provide your most recent and detailed accounts receivable aging report
3. Provide your most recent and detailed accounts payable aging report
4. Provide an actual sample invoice
5. Provide a copy of your Articles of Incorporation/d.b.a. filing
6. Provide a copy of your customer list
7. Some factoring companies require financial statements, others do not.

Preferred Industries

• Service
• Temporary Staffing
• Security companies
• Manufacturing
• Transportation
• Textile/Apparel
• Computer Consulting
• Distribution Companies
• Printers
• Sub-Contractors
• All other Industries
• Any company that provides a business to business product or service to another credit worthy business!

Thanks for reading!

Working From Home - Plan Ahead For When Disaster Or Tragedy Occurs

Disasters or family tragedies can strike families in many forms – Mother Nature, sickness and even computer problems can cause major difficulties for your business. Do you have a plan of action on how you will handle your home-based business if disaster were to strike? If not, you absolutely need to. Having a plan ensures that you can not only keep your business running, but decrease stress because you have already prepared for the unexpected.

Below are four tips to help you handle the unexpected.

1. Work around the events –Your customers will understand as long as you communicate with them. Be honest that things may take a little longer than usual, but keep your customers updated as often as possible. Communication is the key. Most people will understand the delay as long as they are aware of it. If you get to the point where you cannot work or cannot finish a project, but sure to be clear and honest about the situation and try to make an arrangement that will be acceptable. Also, let them know as soon as possible so they can prepare. Don’t wait until the last minute to advise them of a potential problem.

If you’re struggling because of a child being sick, try to work when the child is sleeping and don’t stress yourself out to work at other times. Make a schedule of what needs to be done, so that you can accomplish as much as possible during these times.

2. Don’t be afraid to ask for help – As moms, we tend to feel that we should be able to handle everything that is thrown at us. Unfortunately, this just isn’t always the case. There are times when we need to allow ourselves to ask for help. When a tragedy occurs and you are simply overwhelmed, find someone who you trust and ask them for help. Many times, just having someone reply to customers on your behalf can take the pressure off your shoulders.

Allowing someone to help you when necessary can also be uplifting to them as they feel they can be a part of helping in a difficult situation. So don’t’ shy away from letting others know. We all benefit when we work together and help one another.

When our one-year old had surgery he didn’t handle the pain medication well. He was wide awake for the better part of two days. In this case, I knew ahead of time when the surgery would occur, but I had no idea what his recovery would entail. It was impossible to work while he slept, because he wasn’t sleeping. I realized that I not only needed help business-wise, but I needed help with him as well so that I could get some rest. While it was humbling to admit that I needed help, that I couldn’t do it all, it turned out as a great time spent with family that we would not have had if I hadn’t asked for help.

3. Prepare for the worst – Because we never know what the future holds, it is always better to be prepared. As the old saying goes, “Better safe than sorry.”

One of the best resources to help you prepare is the Home Office Recovery Plan: Disaster Preparedness for Your Home Office by authors Diana Ennen and Patty Gale. This e-book covers all the bases of getting a Disaster Recovery Plan in place now so that if disaster strikes your home business or an emergency arises, you are able to get your business back up and running quickly and smoothly.

Ennen states, “In my case, this guide has been a lifesaver as a resident of South Florida. I have prepared for eight major hurricanes in the past two years with Hurricane Katrina and Hurricane Wilma taking a direct hit on Broward County where I live. I was without power for two weeks with Hurricane Wilma. Had I not prepared, my clients would have suffered as would my business.”

Gale also knows the importance of this book having lived in New York after 9/11 and had the task of preparing a similar guideline for a company she was working with at the time. Both know the importance in ensuring your business will withstand whatever this hurricane or any disaster (including a theft in the office or fire) has to offer.

4. Get a Plan - There are times when life becomes overwhelming and you simply aren’t able to accomplish everything on your own. It’s for these times that you need to have some type of log of what you do and what needs to be done. Keep a spreadsheet of tasks that you do, how often they are done and mark them completed as you are able. Keep a list of passwords in a safe, secure place. Make sure that your family (or whoever may be helping you during this time) is able to carry on even in the event that you are away from home.

If possible, train someone that you trust to do the things that you do each day (at least the key things), so that when the unexpected arises you won’t be caught off-guard.

Tragedy comes in many shapes and forms, but if you are prepared much of the unnecessary stress can be avoided. When tragedy strikes, you want to be focused on the important things in life, your family and you. By advance planning you are able to do so.

Working At Home Is Great, But Requires Discipline

Choosing to have a home business is a great step towards achieving self-reliance and financial independence. But often times when people start working from home their level of productivity drops. Why is this and what can be done to change it?

Most people's productivity at work is a direct reflection of their peer group there. At work you had many people on which to compare your level of productivity against. Now that you are working from your house you often have no measure of how productive you are, so most people's activity levels drop.

Also, while at home there are many distractions during the day, which can lead you astray. Television, newspapers, internet, phone calls, and laundry all lead you astray from your good intentions to get work done.

On key thing you can do to increase your productivity is to plan your day out, and write what you want to achieve for that day and stick to your plan. Some activities require a certain amount of time to be put into it, while for other activities you need to achieve a specific outcome. Often times it is better to set daily goals as specific outcomes, otherwise if you just set time limits, the level of importance for that activity swells to fit the time you gave it when instead you might have been finished earlier with better results if you had focused on the outcome rather than the time put in.

Another tip to feel more productive at home is to dress like you are going to the office. Every morning, get up, shower, and put on office clothes. Wearing your work clothes will put you into a different state of mind and will make you more productive. This will be a clue to your mind that now it is time to work.

Having a designated office area is another important thing. If you can have a room that doesn't have a bed in it that would be great. Also, make sure your office is clean neat and try to work with the door closed.

Also, many people who work from home feel shut in. It is important to get out of the house a couple of times during the day and go for a walk or drive. Going to the mall is great for a quick walk and seeing people.

If you decide you really can't work from home; look into renting cheap office space somewhere. In many office buildings you can find a room to rent somewhere, which is much cheaper than renting a whole office.

Working from home is great if you have the discipline to keep at it. It takes consistency and drive just like any other job, but it can be a great experience. Start by making your to do list for tomorrow today.