The current outlook for the economy is uncertain, and the news is filled with everything ranging from “doom and gloom” headlines to statistics that often conflict with each other, leaving business owners confused. One thing is certain, and that is that businesses need to accelerate revenue – not only because of the current economic landscape but because of the overall benefits it offers to businesses regardless of the outlook.
How Can Businesses Accelerate Revenue?
Accelerating revenue may seem like an impossibility. After all, sales are made, invoices are issued, and then customers need to make payments on the amount due in 30, 60, or 90 days, depending on your company’s policies. Customers cannot be forced to pay faster, but there is a tried and true method for eliminating payment windows. Invoice factoring has been around for centuries, if not millennia, and has been used to accelerate cash flow for businesses across every industry imaginable. When a sale is made, an invoice is generated and sent to the customer. That invoice is a receivable that can be factored for fast access to revenue, minus a small processing fee. Factoring has been used by distributors, law offices, hospitals, sanitation companies, freight carriers, and all other companies that issue invoices with staggered payment schedules.
Accelerating Revenue During Economic Uncertainty
In times of economic uncertainty, businesses want to get revenue as quickly as possible. One never knows if there will be a crash, rate hikes from the Fed on business loans, or something else that will increase costs for businesses, so it makes sense to eliminate long waiting periods if at all possible. Since staggered payment schedules of a month or longer are standard business procedures, invoice factoring offers a direct path forward for businesses to boost cash flow and get access to revenue quickly. By accelerating revenue, businesses can smooth out uneven revenue cycles, cover overhead, make payroll, and build up capital reserves. The fast a business can build up those critical reserves through factoring, the more of a buffer it will have in case of an economic downturn. In a very real way, invoice factoring helps businesses to become recession-resistant, if not recession-proof.
Accelerating Revenue During an Economic Upswing
If the economy is moving full-speed ahead, what need is there for businesses to accelerate revenue? After all, during an upswing, sales increase, and theoretically staggered payment schedules mean very little. The reality is that a business can have sales through the roof, but if there are still staggered payment schedules of 30 days or longer, cash flow can remain a trickle – even during an economic boom. Invoice factoring once again eliminates those staggered payment schedules, and the quick access to revenue offers all the benefits that businesses receive during economic uncertainty, but with two added advantages. First, businesses that build up capital reserves do not need to rely on debt-based loans. Invoice factoring is itself a debt-free solution, but reducing the need for debt puts businesses in a much stronger position than those with liabilities on the balance sheet. Second, businesses can achieve growth faster during an economic upswing if they are not waiting on payments from their customers for 30, 60, or 90 days. Being able to make a big leap in growth, roll out new products and services, or reach critical milestones without relying on loans makes a big difference.
Making Invoice Factoring a Standard Operating Procedure
Since Businesses benefit from factoring in both economic upswings and downturns, are there any advantages to incorporating factoring as a regular function of your business? Well, considering the fast turnaround times on receivables, invoices do not get a chance to go to collections. In that respect, invoice factoring helps to automate your company’s accounting department by eliminating those calls and emails to get payment from customers. By boosting cash flow and building up capital reserves, businesses can thrive and grow come rain or shine.
Start Accelerating Your Revenue Today
Single Point Capital offers comprehensive invoice factoring to businesses throughout the United States. We will turn your unpaid receivables into cash and make funds available within a single day. If you want to gain all the benefits of invoice factoring mentioned above, plus a suite of tools to manage and track payments, contact the team at Single Point Capital today.