Invoice factoring, also referred to as selling accounts receivables, is a process where companies offer open invoices for sale to an invoice factoring company. The account receivable finance company, or factor, assigns a value to the invoice portfolio based on the ability it has to collect, the industry they serve, the credit reputation of the debtors, and the total amount due before offering a factoring and advance rate for the invoices. If the valuation is deemed fair by the company selling the invoices, the transaction is closed. By selling invoices, companies can focus on their main tasks: creating more products and finding new customers, rather than dealing with the frustration of chasing down money from sales that have already been made. So if your business has invoices that are not only weighing down your balance sheet but are costing you time, money and effort to collect, consider selling these invoices to GAC Commercial Southeast, Inc.
Fast Business Solutions
Although invoice factoring might interest your company, one of the best ways to know if it’s right for you is to thoroughly research the process. The best factoring companies try to make the process easy on your business. GAC Commercial Southeast helps you to clearly understand the different requirements in getting your business the cash it needs through the sale of your accounts receivable. Here’s a graphic that outlines the simple process of invoice factoring.
You need to maintain a good relationship with your customers, even when you factor their invoices. You provide your service to your clients and create an invoice. A copy may be sent to your clients so they know how much to pay. If you choose to use invoice factoring, you then send the invoice to us as well. Typically, the more invoices you factor, the lower the rates will be.
The Role of the Factoring Company
We pay you a certain percentage for the invoices as per our agreement. We notify your customers where they need to send their payment, which is made payable to your company. We then wait for your customers to pay the invoice amount within the agreed upon terms. If the amount is left unpaid, we work with your business for further options. Once the customers pay in full, we pay you the remaining balance, less any fees.
Your Customer’s Role
Your customers continue to receive the same great service from you they have come to expect. The only change they experience during the invoice factoring process, is where they send their payment. Instead of sending payment to you, they will send it directly to the factoring company.
We Make It Simple
Invoice factoring does not have to be a complicated process. It’s not like applying for and paying back a loan. You do not need to calculate interest or arrange for installed repayments. Here is how the process works:
* You provide goods or services to your clients and send them an invoice.
* You send a copy of the invoice to your factoring company.
* The factoring company pays you a specified percentage for the invoice, usually 80-90%.
* Your customers submit payment, made payable to you and sent to the factoring company for processing.
* You receive the remaining balance for the invoice(s), less any fees.
The process is seamless and transparent.
Growing companies turn to GAC Commercial Southeast for fast capital.
GAC Commercial Southeast, Inc., is a private funding source that has funded businesses, in a variety of industries, and market space. We have extensive experience in a variety of sectors and are proud to be a funding partner assisting companies meet their ever-changing needs.
Partnering with GAC can help you:
* Make payroll
* Pay bills on time or early
* Purchase inventory, materials and supplies
* Expand operations
* Hire new employees
* Stay current on taxes
We can help if you have experienced:
* Maxed-out lines of credit
* Terminated and/or reduced lines of credit
* Seasonal business
* Tax problem