Invoice Factoring Blog

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

We have probably all heard the expression - "it's a cash cow." A cash cow is a business or product generating a high profit margin and steady flow of dependable cash: so high that it is responsible for a large chunk of operating profits that exceed the amount needed to sustain the business, so this excess cash is used by the business for other things, and to grow.

As you struggle with managing the finances for your company, it is not enough to just think about generating revenue - it is just as important to think about managing cash flow -- managing, or controlling how your time and money is spent. The goal here is to get the biggest return on investment (ROI) for the time and money you invest in your company, so that one day you can say it's a 'cash cow."

We all realize that this economy has caused many businesses to cut back on spending, which may not be in their best interest. For instance, doing marketing will generate more business for your company than not. However, if your clients are not paying invoices on time, you can't generate the cash flow required to grow - let alone create a cash cow. '

Invoice factoring can help you get these funds in earlier so you can pay employees, and purchase supplies, equipment and manage other key expenses to grow. You could also spend the money on marketing, and new business leads will come in. It is this money that will return the amount while providing additional revenues – and these profits can be put back into the company to once again generate more business via factoring.

Most small businesses learn from their mistakes in their earlier years, but in today's economy, there is often not enough time to wait in order to turn a profit.

A recent confidence survey on small business in the United States, shows an increase in the number of business owners who say economic conditions for their own businesses are getting better. The survey reports that 30 percent of them believe the climate will get better in the next six months, compared to only 20 percent who answered that way in earlier in the year.

When they were asked about their intentions to invest, 23 percent of business owners said they would increase spending in their businesses.  This figure is up from 18 percent earlier in the year.  43 percent still plan to decrease spending on their businesses.

The highest it has been in 20 months, small business owners who say the current economy is good or excellent was 13 percent in April, up from 7 percent earlier in the year. Furthermore, 29 percent rate the economy as fair; 57 percent think it's poor; 31 percent say it is getting better;  52percent said it's getting worse; while 14 percent are not certain.

For many small business owners cash flow issues have eased slightly. Fewer owners said their businesses experienced temporary cash flow issues in the past 90 days. This caused them to hold off on paying bills.

Although the confidence survey shows some month over month improvement, there is still significant room for improvement and many businesses continue to suffer from cash flow problems. One way that businesses can accomplish this is by using invoice factoring companies, which can help businesses during this recovery period when cash is need to help expand a growing business.

One of the oldest and most widely used forms of funding for businesses is use of invoice factoring companies who perform standard invoice factoring, which has been around for thousands of years. Many businesses do not get paid immediately for delivered products or services; however in order to sustain and grow, every company needs cash. A newer form of accounts receivable factoring, however, is spot factoring, or single invoice factoring. It is of benefit to firms that do not get paid for 30, 60 or 90 days. How? Some factors advance up to 90 percent against invoices.

Some invoice factoring companies offer “use it as you need it” funding options, therefore every invoice purchase is a separate transaction and does not form part of a portfolio lending approach. The transaction is modeled as a buy-sell transaction. Invoice factoring companies are user friendly, fast, flexible, and cost effective and professional rates are competitive; each client's circumstances will vary and may have an impact on the fees.

Link: http://www.ifgetwork.com

IFG Network LLC, the operational company of The Interface Financial Group (IFG), launched operations through its new subsidiary, the IFG Network UK Limited in Birmingham, West Midlands in the United Kingdom. IFG is North America's largest alternative funding source for small business, providing short-term financial resources including invoice factoring.

Factoring benefits businesses that do not get paid for 30 to 60 or 90 days by advancing up to 90 percent against invoices. IFG looks at the creditworthiness of the client's customers and can fund within as little as 24 hours. The company does not expect to buy 100 percent of a company's receivables, and there are no minimum or maximum sales volume requirements. Historically, factoring has been around for more than 4,000 years, while today IFG is finding that single invoice factoring is a popular new tactic allowing companies to factor one invoice at a time.

"With this latest initiative we seek to boost the business of present and future IFG offices in the UK through our syndication activity," said Chairman of IFG and Chief Executive Officer of IFG Network George Shapiro. "Known as 'the workshop of the world' Birmingham has developed into a national commercial centre, and the second-best place in the United Kingdom to locate a business."

Visit www.ifgnetwork.com for moore information.

Link: http://www.ifgetwork.com

The Internal Revenue Service (IRS) announced that it is mailing a postcard campaign to more than four million small businesses notifying them to see if they qualify for a tax break designed to encourage smaller businesses not mandated by 2014 to provide health care to their low- and moderate-income workers.

The tax break is being offered in two phases -- the first phase being worth up to 35 percent of a qualifying businesses' premium health-care costs for tax years 2010 through 2013. The rate increases in the year 2014 to 50 percent, with a maximum length of potential coverage for qualifying employers at six taxable years: four years under phase one and two years under phase two.

Businesses must cover at least 50 percent of the cost of health-care coverage for some of their workers, employ fewer than the equivalent of 25 full-time workers and pay average annual wages below $50,000 in order to be eligable.

Businesses who are scrambling to come up with the funds to cover their employees based on the new health care reform laws, could use factoring of their invoices to come up with the money.

Link: http://www.ifgnetwork.com

Factoring just might be the answer for small businesses to get alternative funds, because two of the Small Business Administration (SBA) loan programs will soon run out of money.

For the fourth time, the SBA will be opening the Recovery Loan Queue to track applicants wishing to collect the last few remaining dollars. The SBA used the funds first allocated in 2009's Recovery Act. It was intended to temporarily reduce fees for borrowers and increase the guarantees banks receive on loans made through the SBA lending programs. However, the money ran out last November, so they have been relying on temporary extensions, the latest of which will expires at the end of this month.

The bottom line is losing the SBA's fee waiver can make a loan more expensive for the borrower by the thousands. What's more, the banks don't want the risk - they are only willing to make some loans if the higher SBA guarantees are in place.

With this news, many businesses seeking loans will find alternative funding methods such as accounts receivable factoring.