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Customers use your full credit terms leaving you short paying staff at the end of the month?
When business is growing, cash-flow can get left behind. Still waiting for payment from sales two months ago?
In a growing business are you chasing sales but not having the time to chase payments?
Do you know who is due to pay you, when, and which payments are late? Do clients only pay if you chase them?
If your business has a bad debt problem are you giving too much credit to customers who don’t deserve it?
When businesses grow quickly it’s easy to make a lot of sales, invoice them but while waiting for payment there’s no money to buy fresh stock or pay wages.
Importing, especially from China can result in paying for goods up to three months before you receive them!
If your business can pay suppliers earlier could you negotiate discounts with them?
Your business overdraft is there to help with the ups and downs of daily cash-flow. A growing business will start to push the overdraft limit and lose the confidence of the bank.
The cheap sale is too tempting to stock up on, problem is when it’s still sitting there and has to be paid for.
If your business suffers from any of the problems above then invoice finance (factoring, invoice discounting, single invoice discounting or international trade finance) could be a lifesaver.
Invoice finance is a flexible loan using your unpaid receivables as the collateral (security) for the loan.
Once the lender is satisfied with your sales process they will advance anything up to 90% of the value of each invoice you submit.
As your business sales grow, so does your available facility. This allows you to purchase more stock or raw materials, pay your staff or negotiate better terms from your suppliers.
Acorn.finance will take the time to understand your business, growth aspirations and plans and partner you with a cash-flow funder who will give you the funding you need, the right service and support, at the best possible price.
When you raise an invoice it is sent to the invoice factoring company who “buy” the invoice from you for a percentage of it’s value (normally between 80% and 90%).
The invoice factoring company will then follow up with your customer to ensure the invoice is paid on time.
When the invoice is paid the invoice factoring company repay you the remaining funds less the interest due on the amount lent.
Factoring is perfect for small businesses who don’t have a full credit control department.
Some suppliers prefer you not to factor, in which case full confidentiality can be arranged.
When you raise an invoice it is sent to the invoice discounter who will advance funds to you without taking ownership of the invoice – the advance is still 80% to 90% of the invoice value.
Your in-house credit control department continues to chase payments as they did before the facility was put in place.
Your business collects the payments from clients direct. The lender will then invoice for funds used and any other charges.
Growing businesses who have a fully functioning accounts and credit control facility established in house.
Invoice discounting is generally fully confidential (fully titled confidential invoice discounting)
If a single sale or customer creates a “lump” in your cash-flow. For some businesses that means turning away a lucrative sale as they can’t afford to service it.
Single invoice discounting can be requirement rather than sales driven – VAT or PAYE bills, key negotiations with creditors or debt repayments.
Taking larger contracts would be great but they have the power to dictate longer terms. Many businesses accept up to 120 day terms to get the deal only to go bankrupt before they can collect.
Businesses of all sizes needing flexibility not a regular factoring or invoice discounting facility.
Goods bought paid for locally, by the funder against shipping documents or via a letter of credit.
Goods can be shipped to your warehouse or factory or supplied directly to your customers.
The funding is still in place
Once you invoice regular invoice discounting continues to fund cash-flow until full payment is received.
With a few exceptions, funding available with most countries. Especially the UK’s main trading partners.
Acorn.finance work with a broad variety of introducers from a broad variety of sectors including;
- Business transfer agents
- Estate agents
- Mortgage Brokers
- Financial Advisors
- Insolvency Practitioners
- Business Consultants
Borrow against future card sales
Flexible repayment options
Pay a percentage of card sales
Less for a quiet month, more if you’re busy