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Nationwide Business Finance is a premier national lender
providing financing to small and medium sized businesses
nationwide.
Unlock the Cash Tied Up in Your
Receivables.
Accounts Receivable Financing (Factoring) is designed for
businesses that want to improve their cash flow by not waiting
30,60, 90 days for a customer to pay. Factoring is used
in almost every industry today that sells business-to-business
or business-to-government.
Factoring is not a loan and differs from borrowing in that
your A/R (invoices) are sold at a discount rather than merely
offered as collateral. It's the same concept as offering
a discount for early payment of your invoice (for example
1% 10, Net 30 days), only now you get the money in 24-48
hours and it doesn't depend on your client wanting to pay
early.
New businesses and fast growing companies have
a huge demand for cash. And chances are their A/R is growing
faster that their cash flow. Until growth levels off, they
can never catch up!
How it Works
Once your account has been opened, the following steps
are the typical scenario:
- An invoice is created for goods or services delivered.
- A copy of the invoice is submitted via fax or email.
- The factor makes sure your customer is creditworthy,
willing and able to pay the invoice when due.
- Cash advance (usually 70 - 85%) is wired to you. (Note-your
cash advance percentage will be pre-determined with quote)
- Factor does administrative work of collecting payment.
- Payment is remitted to factor when due.
- Balance is remitted to you, less the discount fee. (Note-your
discount fee will be pre-determined with quote)
What it costs
Discount rates and advance amounts are established by a
combination of the following: monthly volume, your customer's
credit worthiness, invoice sizes, and average payment cycle.
The submission of a simple 2-page application along with
your A/R aging report will allow us to quote you a discount
rate & the percentage of your invoices that will be
advanced.
Other normal charges may be credit reports on clients and
bank wire transfers.
Here are some of the benefits
- Avoid the loss of business to competitors who are better
financed
- Spend less time managing your receivables and more time
managing your business
- Get cash for your invoices within 24 hours
- Stabilize cash flow
- Take advantage of purchase discounts
- Stop worrying about meeting payroll at the last minute
- Improve your company's credit status
- Pay off loans and other debts
- Meet seasonal demands
- Offer better credit terms to your customers
- Your "Line of Credit" grows as your business
grows
- Purchase inventory sooner and fill orders faster
- Fund marketing efforts to grow your business
- Reinvest in your business
- Quick, simple & straightforward
PROFIT COMPARISON
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Currently |
With Factoring |
| Annual Sales |
$1,000,000 |
$2,000,000 |
| 20% Gross Profit |
$200,000 |
$400,000 |
| Overhead |
$60,000 |
$80,000 |
| Cost of Factoring |
N/A |
$60,000 |
| |
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| Net Profit |
$140,000 |
$260,000 |
Net Additional Income = $120,000
Frequently asked Questions
Q: How much does it cost?
A: Our fees are determined by the amount financed, average
invoice size and collection time. All fees are clearly stated
in your agreement; there are no hidden charges.
Q: What types of receivables
can be factored?
A: Just about any verifiable invoice for services rendered
or products delivered, due from a creditworthy company.
Q: Do we
bill on our letterhead or the factor’s letterhead?
A: You continue to bill your invoice on your company letterhead,
but the payments must be remitted to our address.
Q: Must I agree to finance a
minimum volume of future receivables?
A: No. Finance as you need it. Stop when you wish and continue
as needed.
Q: What will my customers think?
A: Factoring is used by many of the largest corporations
in the world. Many of our existing customers do business
with companies such as Exxon, Mobil, Wal-Mart, General Motors
and many Fortune 500 companies. Factoring is a widely accepted
method of business financing and has never created a problem
for any of our customers. Now you can keep the conversations
with your customer about business and leave the topic of
collecting payments to the factoring company.
Q: How long does it take to get
approved for factoring?
A: Once all the information is received, decisions are made
quickly, eliminating long waits for loan committee approval.
The quicker we receive preliminary information on your company,
the quicker we can submit a proposal for your consideration.
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