Cashflows are the lifeblood of businesses. Monthly, weekly, or even daily income can make or break the entrepreneur’s dream.
Business incomes are results-driven and may not come at a time of your choosing. Unfortunately, monthly dues continuously stack-up no matter what.
Singapore has an expensive lifestyle and employees need a consistent means of income. Office rent and machine maintenance also add-up to the bill. Unfortunately, due obligations wait for no one and will not consider invoices that are trapped in limbo while awaiting liquidation.
This is when our invoice factoring comes in handy. At a reasonable rate of up to 80%, we can take away the burden of responsibility for collecting payments for invoices so the business can continue to run smoothly.
The importance of healthy cash flow
As business owners, we understand the importance of healthy cash flows just like you do. Using a simple analogy, cash flows are like the gasoline of a vehicle. A lack of it will hamper daily operations and will adversely affect all profit-making operations. This is especially true for small and medium-sized enterprises who will need a sufficient level of cash in hand to meet everyday expenditures and costly upgrading processes. The prominence of having a stream of cash inflows is acknowledged by industry experts and well-esteemed business magazines who scurry to report on the omnipresent issue. Cash flow allows a business to spread its wings with future expansions and take on unforeseen circumstances. This is widely recognised by business magazines such as Forbes and reputable business tycoon, Warren Buffet, who shuffles billions of dollars into firms that could sustain and continuously evolve themselves from a consistent pool of free cash flow. With the above groundwork set in place, the following section will cover the steps to achieve a healthier cash flow figure via explaining invoice factoring in layman terms.
Focus on growing your business
The point of sales does not equate to cash received. In today’s business world, accounts receivables often come with a varied set of collection periods that differs across industries. For instance, Oil and Gas extraction companies are trademarked for having a prolonged period of accounts receivables days according to Sageworks data. This example alone shows the financial struggles of a results-driven firm during its expansion stages. The need for cash might arise to pay for monthly utility bills, talent acquisition, quarterly machinery inspections/repairs or as a precautionary motive for unexpected events. Without cash in hand, you will face the injustice of having your daily operations hampered, despite already gaining rights to cash flows in a future period.
As a business owner, we understand your undying thirst to materialise your well-deliberated business strategies as envisioned during your brainstorming sessions. However, the high accounts receivable turnover ratio presents a ubiquitous issue that is shared amongst SMEs. The lack of consistent cash flows will inevitably put your business ambitions on hold, delaying expansion efforts. Through our invoice factoring services, we will undertake your invoice collection efforts while meeting your immediate cash flow needs. Focus solely on growing your business while the risk of collection lies on us.
Break the stigmas, release trapped invoices
The high discounted rates and other forms of malevolent methods form the social stigmas of money lending firms. In fact, the simple act of resorting to invoice factoring is surrounded by an aura of negativity. It is seen as a fast way to raise capital while subjecting one’s business to lower revenues from invoices. The social stigmas are real, but we are one of the few survivors who have been actively complying with Singapore’s stringent laws, to provide you with a safe and reasonable approach to invoice factoring that can help to pull you out from cash flow problems.
Under your discretionary, you can pick and select the invoices that you would like us to finance. If you are a novice in this field, we will extend our fullest support by guiding you through unfamiliar terms and conditions. You will no longer have to endure through the credit period and the unnecessary frustrations from debt collections.
Benefits of invoice factoring
An immediate solution to cash flow problems for the following needs:
Manufacturing: Large-scale manufacturing ventures require a considerable sum of cash investments upgrading/purchase of new machinery.
Freight factoring: Massive client undertakings will incur a myriad of expenditures. (E.g. cargo purchases, carrier costs, documentation fees, salary of employees and other administrative expenses).
SMEs: Typically, small and medium-sized enterprises require considerable amounts of capital outlay to support pre-planned expansion plans. Instead of delaying the enhancements of your firm’s prospects, let us play a part in realising your ideas while covering your overhead costs on the sidelines.
Bank loan vs invoice factoring
Are you thinking of obtaining a bank loan instead? Let us assist you with an honest comparison.
1. A bank loan will incur intermittent interest rates while invoice factoring is a one-time discounted transaction off your outstanding invoices.
2. A bank loan will not assume the collection duties from your clients. As for invoice factoring, you are unshackled from the tiresome and time-consuming commitments of chasing outstanding payments
3. A bank loan usually requires a mandatory collateral or the pledging of invoices. Invoice factoring is a straightforward, fuss-free process which entitles you to immediate cash flow.
In a nutshell, invoice factoring is an option for you to sell your customer invoices at a discount, in return for immediate cash flows. For instance, a 45- or 60-day accounts receivable could be unlocked instantly to satisfy your short-term financial needs. Simply liaise with our licensed professionals to get a quick quotation.
To satisfy your diverse needs, we offer both recourse and non-recourse factoring options.
Recourse factoring: The risk of non-payment lies on you. Your business will have to carry the risk of non-payment by your customers.
Non-recourse factoring: We will assume the full risk of non-payments from your customers. (Non-recourse factoring fees will be at a slightly higher rate).
You will receive the agreed funding within 1 to 3 business days upon submitting your invoices.