Advantage

Factor, LLC

Copyright © 2004 by Advantage Factor, LLC. All rights reserved.

What are the Costs?

 Selling Your Invoices Can Actually Make You More Money!

If you have the ability to make money with money,
the real question is:
 How much does it cost you to not factor?!?

When you extend credit terms to your customers, YOU are financing THEIR business.  No interest is earned, and you lose the use of your money while waiting for your customer to pay.  This is known as opportunity cost.  Make no mistake, opportunity cost is a cost to your business and impacts your revenue and profit potential in several ways:

• The most impacting scenario is when an opportunity for growth or a big job or order comes in and you don’t have the cash to do the deal.  This may take several forms: you can’t afford to hire and train a new salesperson or you can’t pay for the marketing campaign that would bring in additional sales, or you just can’t float the labor or inventory for a big job.  Keep in mind, the amount of money in your receivables is YOUR money, but it is a non-income producing asset as long as it is not in your bank account.
• One of the first business rules of thumb for a savvy entrepreneur is to sell any nonessential non-income producing asset.  In doing so, the funds produced can be put into something that actually makes profit for the company.  Accounts Receivable are an asset on your company books.  Are your receivables making or costing you money?
• Even if you don’t have an immediate opportunity for growth, additional funds can be used to pay vendors and receive purchase discounts or, at a minimum, a better credit standing.
• Leftover discretionary funds can simply be placed into an interest-bearing account, not only earning interest, but immediately available when the opportunity presents itself.
• The longer your customers take to pay, the greater the impact on your ability to earn a profit.

Advantage Factor, LLC can get you 75% of your invoice within hours.  When the invoice is paid, you receive the reserved percentage less our competitive fee.

The fees are based on the time it takes for the invoice to be paid and are never more than 5% for the first 30 days.  Fees typically increase no more than 3% for each additional 15 day block.

NOTE: As the time starts on the advance date rather than the invoice date, the fee is manageable by you.  If you know a customer pays in 45 days, you can hold the invoice for 15 day and then sell it, to remain in the 30 day fee range.

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