Invoice Factoring Blog

Link: http://www.ifgnetwork.com

According to a monthly survey released today an index measuring small-business optimism fell 1.3 points to 88.0 in February. Source: National Association of Independent businesses.

Far below its average, the index has gained from 81.0 in March 2009. Small businesses reported problems getting credit, with 9% of firms saying they couldn't find the specific credit needed.

This lends credance to the concept that during this kind of an economic downturn, many other small business owners continue to survive and grow throught the use of factoring.

Factoring allows companies with outstanding invoices to collect early on monies due. Anyone with invoices that are due in 30/60 or 90 days can benefit by turning over these invoices to a factoring company like IFG.

But every business needs some cash on hand in order to sustain and grow. So what happens if you do not get paid for a few months, and you do not have time to seek alternative financing through banks or venture capitalists? Spot Factoring is the answer to your troubles.

Single invoice factoring is an extremely fast way to turn your receivables into cash. In an ordinary scenario you might have to wait 30, 60, or sometimes even 90 days for invoices to be paid; IFG looks at your customers' credit (not yours) and can pay you the majority of what's owed to you within as little as 24 hours.

Link: http://www.ifgnetwork.com/accountsreceivablefactoring.php

Many small businesses are scrambling this month to meet the annual tax deadlines. And this year, the recession has made the job even more difficult. In fact, this is the time of year when many small businesses resort to accounts receivable factoring, in order to pull together the funds to pay their taxes.

The more tax deductions your business can legitimately take, the lower its taxable profit will be, but business owners need to be very careful about the IRS rules on what business expenses are deductible.

Following are some of the more common business deductions:

1) Expenses that go into running the business including rent, utilities, advertising, office supplies, and other miscellaneous items are considered current business expenses.
2) Automobile expenses if your car is used for business or if your business has a vehicle.
3) Equipment can be written off by most small businesses, who can write off the full cost of some assets in the year they buy them, rather than deducting their cost over a number of years, or capitalizing them.
4) Legal and professional fees paid to tax professionals, consultants or lawyers are generally deducted in the year incurred.
5) Educational expenses, if they are related to your current business, occupation or trade, may be deducted just as long as the education is intended to improve or maintain your skills.
6) Bad Debt - depending on the kind of product your business sells. For example, you may deduct the cost of goods sold but never paid for, but not services. Deductions are not allowed for time you devoted to a customer who did not pay.
7) Entertaining, as related to current or prospective customers, may deduct 50 percent of the cost if it is directly related to the business or if it is associated with the business, and the entertainment takes place before or after a discussion about business.
8) Travel as related to business offers many deductions for expenses, such as the cost of plane fare, taxis, lodging, operating your car, meals, shipping business materials, cleaning clothes, telephone calls, faxes, tips and more.
10) Charitable contributions (old used computers, equipment, furniture, etc.) can be a tax deduction IF your business is a partnership, a limited liability company, or an S corporation (a corporation that has chosen to be taxed like a partnership), your business can make a charitable contribution and pass the deduction through to you.
11) Real estate property can be used as a deductible, along with repairs or maintenance.

Small to mid-size companies that apply for a bank loan are turned down. If you find that you do not have enough money to cover this year’s taxes, think about accounts receivable factoring, in order to collect the funds and pay your taxes on time. Factoring is one of the oldest financial methods. Whereas banks typically require collateral from a business before they are approved for a loan, factoring happens fast, and in fact, often as little as 24 to 48 hours.

In today’s tough economy, small business finance can be confusing unless you know the tips for negotiating the best deals, sourcing funding, and most importantly, keeping the cash flow healthy.

A number of financial experts today know that invoice factoring is a proven financial method to stay afloat. Factoring has been around for the last 4,000 years. Over a recent 15-year period, small businesses created some 65 percent of the net new jobs in the private sector, according to a March 2010 report called, “An Analysis of Small Business and Jobs.” (Source: Small Business Administration, Office of Advocacy.)

Probably the most important tip to remain successful in your business is to have sufficient cash flow by planning a budget a year in advance. Remember that outside events will affect your budget planning. For example, what if your main customer goes bankrupt? Or what if another good customer decides to move? Do you know how much of your sales these customers generate? What if two or three of your customers don’t pay your invoice on time?

Invoice factoring is not a lending service – it’s really a discounted purchase. Invoice factoring can help resolve some of these types of issues. It can also make your marketing budget work better, and help you improve operations, increase profits, buy more supplies and pay your bills on time. Whether you are a start up business or one that has been around for many years, companies everywhere in the United States are struggling to make a profit.

Invoice factoring, also known as accounts receivable factoring, provides small to medium-sized business owners with working capital when traditional funding is not available – such as bank loans or credit. Using invoice factoring is one of the most effective ways for a business to raise working capital for ongoing operations or planned expansion.

The financial practice of factoring dates back to the ancient Roman civilization. Here are some of the other items that factoring resolves:

•Has no limits and provides fast results
•Stimulates economic growth, allowing expansion without debt.
•Provides companies with continuous working capital, increasing their cash flow.
•Is accessible and flexible.
•Increases production and sales.

Through careful budget planning, watching expenses and the use of invoice factoring, small businesses can survive and come out of the recent recession on top, which will ultimately create more jobs, and fuel a better economy in the future.

Link: http://www.invoicefactoring.com

(Source: Small Business Administration, Office of Advocacy.)

The most important tip to remain successful in your business is to have sufficient cash flow, so planning a budget one year in advance is essential. Plus, don't forget to consider how outside events will affect your budget planning.

Here's why. What if your main customer goes bankrupt? Or what if another good customer decides to move? Do you know how much of your sales these customers generate? What if two or three of your customers don’t pay your on time?

Invoice factoring is not a lending service – it’s really a discounted purchase. Invoice factoring can help resolve some of these types of issues. It can also make your marketing budget work better, and help you improve operations, increase profits, buy more supplies and pay your bills on time. Whether you are a start up business or one that has been around for many years, companies everywhere in the United States are struggling to make a profit.

One of the oldest methods of finance -- invoice factoring, also known as accounts receivable factoring -- provides small business owners with working capital when traditional funding is not available – such as bank loans or credit. The financial practice of factoring dates back to the ancient Roman civilization and helps resolve:

Factoring has no limits and provides fast results
It stimulates economic growth, allowing expansion without debt.
Invoice factoring provides companies with continuous working capital, increasing their cash flow.
Factoring is accessible and flexible.
Invoice factoring increases production and sales.

Those who use invoice factoring, one of the most effective ways for a business to raise working capital for ongoing operations or planned expansion, will come out on top.

There are many ways that a business can survive an economic slowdown, including reducing business costs, planning for future growth and measuring the growth.

Today it is more important than ever to remain cash rich during this economic recovery. Why? The 2010 Small Business Administration report which reveals that from 2008 to mid-2009, net lost 2.8 million jobs were from establishments with employment swings of 20 or more employees. Unemployment rate peaks during previous recessions declined by 2.4 percent within 12 months. It is possible that such a reversal has begun in the current downturn as the unemployment rate dropped from 10.1 percent in October 2009 to 9.7 percent in January 2010.

It just takes careful budget planning, watching expenses and the use of invoice factoring, small businesses can survive and come out of the recent recession on top, which will ultimately create more jobs, and fuel a better economy in the future.

Link: http://www.ifgnetwork.com/ABeginnersGuideToFactoring.php?PHPSESSID=eb33fb395bcd90bc14d431c343ba8521

Have you heard about the America's Recovery Capital program offered by the Small Business Administration? To date 6,340 businesses plus were receiving the SBA ARC loan nationwide. This program was created as part of year's stimulus package. The ARC loan offers to assist small businesses hurt by the recession, and it will run through September 2010, or sooner - until all the funds have been depleted.

Interestingly, invoice factoring has been helping businesses for thousands of years. Factoring dates back 4,000 years to King Hammurabi ([1795-1750 BC]), the king of the ancient culture of Mesopotamia who established the world's first metropolis also known as Babylon.

The Mesopotamians eventually became an extinct civilization, but factoring remained popular, and history tells us that every civilization with commerce has practiced some form of factoring, and that includes the Roman culture who were the first to sell what was known as discounted promissory notes.

Initially documented in the American colonies some time before the revolution, factoring took place at a time when raw materials and goods were shipped from the colonies to America by merchant bankers in Europe who advanced funds to the American colonists for materials. Backs did not exist back then. This enabled the colonists to continue to harvest their new land and they were not under any obligation to wait to be paid.

It was during the Industrial Revolution when factoring became more focused on credit, as factors guaranteed payment for approved customers. Before 1930 in the United States, factoring occurred primarily for the textile and garment industries, and then after the war years, factoring expanded to other types of business.

Factors that were private factors became popular when interest rates rose during the 1960's and 70's, intensifying in the 80's due to the increasing impact of interest rates and changes in the banking industry. It was at this time when small businesses were forced to find other sources of financing for growth.

Nowadays during the economic recovery, businesses will continue to use accounts receivable factoring for growth, profit, and security.