Factoring: Why Factoring May Be Your
Best Financing
Option!
by Sandra Noble, President, MBA, DCFS, Six Sigma, CPIM
Noble Finances / Noble &
Associates Consulting, Inc.
There are
non-debt financing solutions. Have you heard the
term “Factoring”. Or, are you familiar with the concept of “Accounts
Receivable Financing”?
Both of these terms are synonymous. And both refer to ways of getting
cash without incurring debt. Factoring occurs when you sell your
accounts receivable invoices in exchange for CA$H. In as little as 24
hours, you would receive from 50% to 90% of your invoice face value. The
funding source or factor would then collect from your customer. After
your customer pays, you receive the remainder of your money less a
discount fee.
The chart below has a quick
Comparison of Factoring with Other Financing Options.
Leasing
Venture Capital
Bank Loan
Private Investor
Factoring
Simple Application
No
No
No
Depends
Yes
Days for Approval
15-30
90-180
60-180
15-90
3-10
Approval Based on Your Company's
Credit
Yes
Yes
Yes
Yes
No
Give Up Equity
No
Yes
Yes
Yes
No
Give Up Control
No
Yes
No
Sometimes
No
Limited to Asset Value
Yes
No
Yes
Maybe
No*
Automatically Expandable
No
No
No
No
Yes
Require Profitability
Usually
Usually
Yes
Usually
No
Reduce Overhead
No
No
No
No
Yes
*Limited to your
accounts receivable value, but not limited based on other assets.
How It Works Noble Finance$
provides Accounts Receivable Financing (Factoring). Funds
are available for companies with monthly receivables of $10,000 or more.
You are approved for this funding based on the creditworthiness of your
customers.
The initial funding period shown above includes time for due diligence
and application processing. Once your account is set up, all you need to
do is fax in your invoice and cash will be wired to your account in 24
to 48 hours!
for more strategies for strengthening your business:
Noble Finance$:
Accelerating Cash Flow!
A Diversified Cash Flow Specialist (DCFS) company, certified by the
American Cash Flow Institute®.
Noble Finances
is a division of Noble & Associates Consulting, Inc.
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Noble & Associates Consulting specializes in I.T. Needs /
Strategy Assessments, unbiased Software Selection assistance, and curing
Post Implementation DistressSM. We also have full life cycle
implementation expertise in SAP, Oracle and other enterprise-wide
software solutions.
