Cash flow, or lack thereof, can accord or deny a business a competitive edge. Liquid cash is a deciding factor, especially when a business wants to grab an opportunity. Whether it is capital expenditure to finance an opportunity, meet an unforeseen condition, or secure a new order, cash flow can’t be overlooked as you run a business. While considering the fastest way to access liquid cash, asset-based factoring wins on many fronts. A business doesn’t need collateral. The arrangement is fast. The strategy is a sale, not a loan, and the business avoids bad debts if the agreement is without recourse factoring, just to mention a few advantages. Nonetheless, you need to select the best factor to realize such benefits. With the competitive services available, this can be a daunting process. Among the tips that can help narrow the options include;
Experience isn’t simply how long the company has been around when choosing an asset-based factoring service. You need to consider industry experience. The last thing you want is to waste your valuable time explaining various dynamics in your line of operation. A factor that understands your industry and business model best matches your requirements. They understand your unique needs and how the day-to-day operations are conducted. Partnering with such a service translates to a smooth factoring process. It saves you time and frustrations that could shift your focus and affect productivity.
Flexibility can’t be emphasized enough as you select an ideal asset-based factoring service. It is easier to focus on the financial implication, but that’s not the best approach. Understanding the terms, such as how long you’ll have to remain in the factoring relationship, maximum funding, among others, can help you make a better decision. This allows you to pick a service offering flexible terms in line with your operations. You’ll eliminate the friction that could frustrate your operations in the long run, making it easier to build a bigger and better business.
Time is money. You’re getting immediate financing to keep your operations going. However, consider if the arrangement is worth the time? As much as you need the liquid cash, your engagement should be characterized by frustrating communication flow. Response time can make or break your engagement. If you’re put on hold for an extended period, your emails take days to be replied to, among other delays, your engagement won’t be as productive. The best asset-based factoring provider provides 24/7 customer support services. They are available whenever you need them, ensuring that you don’t waste your valuable time. With prompt and professional customer support, your concerns won’t fall on deaf ears, facilitating a smooth factoring process.
Choosing a factor with an established track record is recommended as you narrow the services. Also, check if the factor is affiliated to professional bodies like the International Factoring Association (IFA), considering that reputation and stability can’t be discounted. A reputable factor observes a set code of ethics. This means that your engagement won’t be characterized by unprofessionalism, a concern that can ruin your operations.