- Pay Your Employees and Yourself
- Extend Longer Credit Lines to Your Customers
- Grant Credit Lines to NEW Customers
Working Capital is essential for your company to meet its continuous operational needs. The availability of working capital influences your company's ability to meet its short-term debt obligations, as well as to remain financially viable. If your current assets do not exceed your current liabilities, you run the risk of being unable to pay short term creditors in a timely fashion.
Many companies suffer from negative cash flow due to the time frame in which their customers pay their invoices. Some companies open a bank line of credit to gap the difference from the time they invoice their customers, to the time they receive a payment. The problem with this is once a business starts tapping into a line of credit, it is often very difficult for that business to pay off its line of credit. When this happens, the short term demand for working capital is solved, but now the business has assumed an additional debt that must be paid off or paid down on a monthly basis.
Account Receivable Financing for Immediate Cash
Working capital also gives businesses the freedom to grow their business, hire new employees, order new machinery and meet payroll demands. One of the biggest reasons why companies use the services of a commercial factoring company is to offer longer credit terms to their customers. This is something they normally would not do, due to existing working capital needs. When you factor your invoices, you get paid within 24 hours of the verification of that invoice, whether or not the customer pays in 30 days or 90 days.
Extending credit to new customers is a risk; that risk exists in the form of insolvency, net terms on receivables and the fear of the creditworthiness of the new client. When you factor your invoices with Alliance One LLC; we purchase credit insurance on every invoice, at our cost. If you offer credit to new customers or increase the credit limit to an existing customer, our insurance coverage will protect you in the event that your new or existing customer becomes insolvent, even if we already paid you on the invoice. This is the difference between Alliance One LLC and other factoring companies; we set the bar in the factoring industry.