Many businesses often overlook factoring as a financing option due to various misconceptions. In this article, we debunk three common myths surrounding factoring, shedding light on the flexibility and suitability of this financial tool for a range of businesses.
- Banker Resources
- Factoring Resources
- Success Stories
In the world of business finance, the art of managing cash flow can make the difference between survival and success. Many businesses, whether they’re startups with dreams of greatness, established firms looking for expansion, or seasoned veterans of their industries, turn to invoice factoring to improve their cash flow.
In this article, we’ll delve into real-life examples to explore specific examples of how factoring helped businesses meet their financial demands.
In this article, we want to dive into what an MCA loan is and why we think you would only want to resort to it if you have no other options.
“This was a great deal for everyone involved. By pairing a great business owner with the flexibility that Catalyst Financial offers, OperFi was able to grow exponentially faster than they could with a traditional line of credit. Catalyst met the capital needs from day one. They are a transparent and trustworthy operation all-around, which makes referring to them an easy decision. Even now as we complete the transition back to our bank, the Catalyst team is helpful, forthright, and focused on supporting the customer’s best interests.”
– Bank Referral Partner
Staff factoring is a sale of outstanding payroll invoices to a third-party factoring company. It is a type of business financing to maximize cash flow and effectively fund daily operations. Staffing factoring allows staffing businesses to access the capital needed to recruit, hire, onboard, and run payroll.
Freight factoring is when a company that transports a load sells the resulting invoice from that haul to a financial company at a small discount. This can also be known as invoice factoring, load factoring, transportation factoring, or accounts receivable financing.
When a company needed to document their invoices differently, Catalyst was able to work with them.
Most banks that issue a revolving line of credit want a business to have less than 20-25% concentration with any one customer. If your customers have good credit, factoring is one of the best options for a company with a small customer base.
After a pipeline inspection staffing company outgrew their traditional line of credit, Catalyst was able to pay off the bank and provide the additional funds to keep the business growing.
Defined as the amount of money a business has on-hand to pay for short-term expenses, working capital is an effective way to measure a business’s short-term financial security.
A well-established construction material supplier was incurring significant losses. Their banker couldn’t renew their line of credit, so they referred them to Catalyst.
“It was good for all parties; and the turnaround time was very fast…The company still banks with us, and the implementation of a quick solution with Catalyst made what could have been a complicated problem, be a smooth solution.”
– Executive Vice President & Bank Referral Partner
Because of how quickly a staffing company was growing, they had to turn to MCA loans to make payroll. When their banker saw the debt the staffing company was in, they referred them to Catalyst. Read on to see how Catalyst was able to save this company over $100,000.