It has always been said that the biggest problem that any business will face is getting cash out of their customers. Most SME’S will go bust because of inefficient cash flow. Can a business really rely on its customers paying within the normal 30 day credit terms. Probably not. And is it really wise relying on a bank overdraft which will be capped depending on the level of security available. In addition a bank overdraft can be withdrawn at a moments notice and is potentially always repayable on demand! Invoice factoring will provide a evolving credit facility for up to 90 days against 80 – 90% of your unpaid invoices.
It is possible to refinance already owned plant and machinery to release cash for just about any purpose. There are only a few finance companies capable of doing such financial transactions and most of them are independently owned. It is very unusual for a high street finance company to do such transactions. They simply don’t have the expertise to carry out such transactions. It is not as simple as raising an invoice from the company to the finance company. there is faf more to it than that. XL business Finance has been trading for over ten years and is one one of the uk’s leading asset finance broker. We genuinely believe that if we cannot sort the finance than it cannot be done. To find out how refinancing existing plant and machinery can benefit your business then read on.
Invoice factoring enables a business to obtain immediate cash against its unpaid sales ledger. There are a few finance companies that can actually provide you cash within 24 hours. If you have a sales ledger of £10ok you can expect to receive an immediate cash injection of up to £90,000. The finance company uses the unpaid invoices as security and they are experts in chasing and collecting your debts. Most finance companies will provide credit for up to 90 days from the point you raise the invoice.
Without a doubt there are still many options when it comes to obtaining finance against your unpaid debtor book. The ability to release up to 80% of your unpaid invoices can provide a financial life line for many businesses and can provide a viable alternative to any bank finance arrangement. Invoice financing is still an area of finance where there still seems to be many finance companies in the market for writing new business however how do you know which provider is best for your particular requirements. XLBusiness Finance has been helping many businesses obtain the most appropriate factoring and invoice discounting products based on their own unique set of personal circumstances.
Invoice discounting is only one of several invoice finance products available in the market place. Invoice discounting is mainly provided on a confidential basis and as such is commonly known as confidential invoice discounting. How it works is that a customers will raise an invoice in the usual manner and post a copy to the finance company. the finance company will then make a percentage of the invoice available to the business typically 80%. All this can be viewed on line and different finance companies have slightly different systems and procedures when your customer pays you the finance company is repaid and a small fee is paid to the funder.
Whilst we are still unaware of any finance company that will provides stocking finance on a stand alone basis there is still the odd one or two factoring company that can provide a true stocking facility on the back of an invoice finance facility. By the way if anyone can provide me with details of a finance company that provides stocking finance on a stand alone basis I would love to know.
Arranging any kind of asset finance for a new start business can be a daunting task. It can even more difficult in the current economic climate. With very few leasing companies lending money and the ones that are left lending money can be most difficult to deal with. They are only lending money on their terms and don’t expect to be paying any cheap interest rates. The good news is that arranging hire purchase and finance lease facilities can be relatively straight forward in terms of information require by the leasing companies. We will not require elaborate business plans and cash flow projections
During the last few weeks we have seen an increase in businesses requireing asset finance solutions in the form of hire purchase and finance lease. This has got to be good news for the economy however is it any easier to obtain credit approval for investments. The answer is maybe however at XL Business Finance we take a slightly different approach in organising finance for our clients. As a result our success rate is very high at getting acceptances for our clients.
Invoice factoring can release up to 90% of a businesses unpaid invoices. Choose the right finance company and it is possible to get the cash released to your bank in 24 hours. However when it comes to providing bad debt protection or a factoring facility with non recourse not all finance companies are the same. As we have mentioned in previous blogs factoring adds value to any business. It is not just about re lasing cash, it is about choosing a finance company that can provide a credit control service in a efficient manner without upsetting any of your customers in the process. The bad debt protection is exactly the same in that not all finance companies are the same therefore it is imperative that you choose the right finance company for your particular requirements.
In theory invoice discounting finance will release up to 80-90% of your total invoice book. All finance companies have eye grabbing headline rates and promise the earth when it comes to releasing cash. However the biggest problem with invoice finance and factoring is that it is very difficult to obtain funding against a client if they have a very poor credit rating. As most finance companies will tie you into a 12 month contract or even longer it is imperative that when choosing a finance partner that potential credit limits are taken into consideration. XL Business Finance has over 10 years experience in helping and advising clients choosing the the correct invoice finance company.
XL Business Finance Ltd is a privately owned and independent business financing company with established links to many of the UK's leading finance houses. XL Business Finance provides a viable alternative to high street banks that lack the flexibility and imagination to provide a solution to most business users requirements. XL Business Finance can provide a full range of business financing solutions and we ensure a high level of customer service and pride ourselves on quick decisions. Our independent status will ensure any offer of funding and asset finance leasing is best suited to our customer’s needs.
XL Business Finance, Eaton Place Business Centre, 114 Washway Road, Sale, Cheshire M33 7RF UK.
