Factoring B2B for Delivery Services
When it comes to B2B delivery companies, cash flow is king. If your delivery company is suffering from a lack of cash flow, it can hamper your ability to grow and force your company to turn to bank loans to access the capital it needs to operate effectively.
Taking on significant debt is not a decent strategy for any business, let alone delivery and logistics companies. Also, many banks won’t approve loans for companies that are younger than a few years old, and if your business does get approval, it comes after waiting months.
There is another way for B2B delivery companies to have the necessary capital to grow and operate at scale. Great Funds Factoring helps delivery companies unlock the cash stored in unpaid invoices without banks, interest rates, and lengthy approval periods.
Invoice factoring is the solution your delivery or courier company needs to get off the ground and into the green.
What is Invoice Factoring B2B?
Invoice factoring, also known as accounts receivable factoring, is a financial service that helps businesses get paid upfront for outstanding invoices.
Most companies set their invoice repayment period to 30 days, known as net 30. However, depending on the industry, the repayment window could be up to 90 days. This means that many companies are getting paid months after completing the job.
This delay creates devastating cash flow problems, especially for companies just starting out, or seasonally dependent companies.
What’s the Solution?
Instead of waiting for your customers to pay their invoices, you can sell your invoices to a factoring company. With accounts receivable factoring, the factoring company takes on the responsibility of collection.
Your business gets access to the cash it needs now for a small percentage of the sum of the invoices.
Is Accounts Receivable Factoring a Loan?
No, invoice factoring is not a loan. There is no interest accrued or repayment required. The cash we unlock for you is cash you’ve earned through invoices that haven’t been paid yet. We charge a small percentage of the total amount and get you access to your money in days, not months.
How Can Delivery Companies Benefit From Accounts Receivable Factoring B2B?
Running a delivery business is expensive, and the costs only multiply as a company grows. In order to operate effectively, your delivery service will need capital to pay for necessary expenses:
These expenses can’t wait for slow-paying customers. Your business will need access to the cash locked away in unpaid invoices to meet operation costs.
Plus, Great Funds Factoring works with you to help collect your invoices, allowing you to focus on the management of your delivery or courier company.
How Great Funds Factoring Gets Courier Shipping Services Paid Faster
So, how does Great Funds Factoring unlock the cash stored away in your invoices? Let’s explore the factoring process.
What To Expect from Great Funds Factoring?
At Great Funds Factoring, we understand that there are many financial challenges that even the most successful businesses can go through and the stress that it can cause.
We believe that good communication is key to developing a strong working relationship with our clients and will strive to be personally available to answer questions about receivable factoring.
During the discovery process, we aim to get a better understanding of your business needs, gain your trust, and determine if open account receivable factoring is a fit for you.
After you submit your credit application, Great Funds Factoring, LLC will review your credit application along with other documents required such as bank statements, master customer list, and financial statements.
When the due diligence is completed, Great Funds Factoring works on the approval process. Usually, the entire process both underwriting and approval review takes one to two business days. Once approved, we send you the proposal and all documents needed to set up your account.
As you send invoices to your customers, we verify them and advance your funds immediately to your account, while holding a small amount in reserve until your customer pays their invoice.
Types of Delivery Companies Great Funds Factoring Can Help
Many types of delivery and courier companies can benefit from accounts receivable factoring. Check out some below.
Recourse vs. Non-Recourse Factoring
Great Funds Factoring provides recourse factoring services, which is a cost-effective alternative to non-recourse factoring, which we do not offer. With non-recourse factoring, the factoring company assumes all of the risks if a customer doesn’t pay their invoices. Because of the added risks, the client and the customers (debtors) need to have better credit scores, and the discount taken off of the sum of the invoices is much higher.
Through our recourse factoring services, Great Funds Factoring works with your customers to help them pay on time and makes every effort to ensure they pay. However, if customers do not pay their invoices, our client is responsible for paying us back for the invoice amount.