If you are fed up with having to deal with banks, can’t deal with the slow process of applying for an SBA loan, or are simply tired of being rejected, why not try an alternative form of financing. With accounts receivable factoring you can get immediate funding for your invoices that aren’t due for another 30, 45, 60, or 90 days. Best of all since you are selling your receivables, you aren’t taking on any new debt and credit decisions are based on your customers’ good credit instead of your own. Give DSA Factors a call today at 773-248-9000 and we can be funding you in as little as 24 hours.
It may seem strange that accounts receivable factoring, a form of financing that dates back further than the Silk Road, could fit into the modern world of Fintech, an industry that is less than a decade old. However, like any business that has survived since antiquity, accounts receivable factoring has constantly evolved with changing times and in many ways pioneered the path for the new Fintech industry. While you would be hard pressed to find an a true factoring company that only exists in the online realm, you would be just as hard pressed to find a traditional factoring company that doesn’t offer a large variety of online tools.
In the same way that online banking and ATM machines have made it so many Millennials never had to write a check or step inside a bank branch location, accounts receivable factoring can now provide your business with the financing that you need without needing to walk away from your computer. In fact, here at DSA Factors we’ve been offering online tools to our clients for over a decade now. So in many ways, we were a Fintech company before Fintech even existed. But unlike Fintech, we haven’t stripped down our factoring program to only offer the services and benefits that a web page can provide. Plus we are still happy to work with clients who prefer doing things the old fashioned way, via phone, mail, and fax.
Online Credit Approvals
For years now, offering online approvals has been a standard service that accounts receivable factoring companies have offered. What this means is that when you get a purchase order, you just login to your factoring company’s portal and request an approval. Often times the computer is able to make an actual credit decision on the spot and offer you an instant online approval. Of course, as in any business, there is a limit to what can be completely automated, so in the case where the computer can’t approve an order, it gets sent to your factoring company’s office for review. When this happens at DSA Factors, we do our best to get back to you with a credit decision within 30 minutes, and will e-mail the credit decision to you.
Real-time Aging Statements
Most factoring companies will provide their clients with aging statements each week so that they know where their accounts stand. At DSA Factors we take this one step farther. At any time our clients are able to login to our portal and view a real-time aging statement.
View Transmittal Sheets
Just like how banks and credit card companies allow you to view statements online, at DSA Factors we give our clients to view transmittal sheets from our online portal. And unlike banks or credit cards that may limit you to only one or two years of statements, here at DSA Factors you can go back as far as you want to that very first payment we sent you when you first started factoring.
Access to a Variety of Online Reports
In addition to aging statements and transmittal sheets, at DSA Factors we offer our clients a variety on online reporting options. This includes being able to pull account statements for any customer. Viewing all open or used approvals. Pulling sales reports that show you how much volume each of your customers gave you over a specified period of time. Plus, if there is a report that you would like to see on the portal, all you need to do is give us a call and we will do our best to create it for you. As a family owned business, we pride ourselves on the quality service we provide our clients with, and that extends to the online services we provide as well.
Allow Customers to Pay Online
At DSA Factors we don’t just extend online benefits to our clients, but also to their customers. At any time your customers may login into our portal with a login and password we provide at the bottom of every account statement we send them so that they can view a real-time statement and make payments online. After all, don’t your customers deserve access to the same online conveniences as you.
Why Choose Accounts Receivable Factoring Over Fintech?
If the online services that we offer at DSA Factors doesn’t seem like enough, keep in mind that we offer one huge benefit that no Fintech company is able to offer. At any time you are able to pick up a phone, give us a call, and one of our principals will be able to talk to you and help you come up with a solution that works for you. That isn’t something that you will get from a large Fintech company, that is something that you can only get from a family owned accounts receivable factoring company. And the value of being able to speak with someone who can actually help you and cares about your business, is much greater than the inconvenience of being limited to only the functions that a web page is able to handle.
If you want to improve your cash flow, outsource you accounts receivable, get credit insurance, and have the convenience of being able to work online, but still want the personalized service that you deserve, give us a call today at 773-248-9000. Or if you want to go “Fintech”, feel free to send us an e-mail at firstname.lastname@example.org or chat with us right now on this web page.
There are many different financing options available to businesses that could use improved cash flow. Two of the more popular options are purchase order financing and accounts receivable factoring. Often times PO financing and factoring are considered alternative financing options, as the process is much faster and easier to obtain than a traditional SBA loan from a bank. While these two methods are related, have similar benefits, and often times can even work together, they still are very different forms of financing.
Improved Cash Flow
While both purchase order financing and accounts receivable factoring are great ways of improving your cash flow, the main difference is when you receive the improved cash flow. With PO financing, you receive funding to pay your suppliers with once they provide you with a purchase order. With factoring you get funded once you invoice your customers.
Since the money is out longer, and isn’t backed up by a receivable yet, PO financing is typically more expensive than factoring. However, for very large purchase orders, traditional accounts receivable factoring may not be able to provide you with enough cash flow to pay your suppliers so that you can fulfill the purchase order. In these situations purchase order financing may be necessary. As a general rule, accounts receivable factoring is a better way to maintain healthy cash flow for your business, while purchase order financing should be used for extremely large purchase orders.
Debt vs No Debt
Another big difference between purchase order financing and accounts receivable factoring is whether or not you are taking on new debt. In the case of factoring you are not taking on any new debt, instead you are selling your receivables at a discount in order to get improved cash flow. With PO financing, you are taking on new debt. PO financing provides you with a loan based on a purchase order. This loan can get paid off if you factor the resulting receivable, or once your customer pays you for the resulting receivable. However, it is still a loan that uses the purchase order, and resulting receivable, as collateral. As a result, you are taking on new debt with purchase order financing.
Since accounts receivable factoring and purchase order financing are both alternative forms of lending, they don’t come with the strict credit limits that a traditional loan from a bank would assign you based on your company’s credit. Accounts receivable factoring is probably the only form of financing that does not come with any credit limit. With factoring there is no limit to how much your factoring company can advance you. Since factoring is an ongoing relationship, as your receivables grow so does the advance you receive. Factoring is based on your customers’ ability to pay, not your own. With purchase order financing, it is typically looked at on a case by case basis and the amount of the advance is limited to a certain percent of the purchase order’s value. So similar to factoring, the larger the PO, the larger the loan. However, you will not receive one hundred percent of the purchase order value.
Whether or not you receive credit insurance is another difference between purchase order financing and accounts receivable factoring. If your factoring company offers non-recourse factoring, then that means that you receive credit insurance when you factor an invoice. With purchase order financing, since there is no receivable yet, you are not receiving credit insurance. That said, if your customer you are looking for PO financing on is not credit worthy, then their purchase order may not qualify for PO financing. On the other hand, once a purchase order is fulfilled and invoiced, by factoring the invoice you will receive credit insurance on it.
Accounts Receivable Outsourcing
When you factor an invoice, you are doing much more than just receiving an advance and getting credit insurance, you are also outsourcing your accounts receivable. Your factoring company will perform all of the credit checking as well as collection work. This can result in significant cost savings as you will not need to subscribe to expensive credit agencies and also may allow you to avoid hiring extra employees to manage your accounts receivable. With purchase order financing, most likely the company providing you the funding will still run credit checks on your customer, they do not manage your accounts receivable for you. You are still responsible for sending out account statements and making collection calls.
Should I Use Purchase Order Financing or Accounts Receivable Factoring?
There is no clear cut answer to this question, it depends on your needs. For most small to medium sized businesses accounts receivable factoring is not only more cost effective but also provides you with additional service such as credit insurance and accounts receivable outsourcing. However, while factoring allows you to maintain healthy cash flow, it may not provide you with enough cash flow if you need to pay your suppliers to fulfill a larger purchase order. In these situations purchase order financing may be necessary.
At DSA Factors we actually recommend using accounts receivable factoring to maintain healthy cash flow and reduce costs. The cash flow you receive from factoring may provide you with enough funds to avoid needing purchase order financing. However, you may still use purchase order financing from time to time as needed. As a result we offer our factoring clients the ability to obtain PO financing when needed.
While there are companies that only provide purchase order financing, they often times may take a week to a month or more to provide you with funding. Typically they only work with foreign suppliers and finished products that are being shipped directly to your customers from overseas. Their interest rates tend to be variable and often times higher than what a factoring company might offer you on a similar loan.
By factoring your invoices and having your factoring company provide you with purchase order financing as necessary, you will most likely receive a better rate and a quicker response when you need purchase order financing. At DSA Factors we make PO financing decisions in a matter of minutes, and can fund you the same day you call us about a PO. We also don’t require you to work with foreign suppliers, we don’t require you to be purchasing finished products, and you can ship to your customers yourself. Because you are shipping to your customers yourself, if the order isn’t for a full container, you will be able to fill up the container with additional merchandise for smaller PO’s or just for inventory. Since we will also be factoring the resulting invoice for you, we can also offer you a lower interest rate on the loan you receive and reduce the time that the loan is out for. Plus you get all the benefits that come with factoring, credit insurance and accounts receivable outsourcing.
Another benefit to working with an accounts receivable factoring company is that by factoring invoices on a regular basis, you are developing a healthy working relationship with a financial partner. In the future, as your company’s needs change, your factoring company may be able to offer you additional services to facilitate growth. By securing purchase order financing through a PO financing company, it is typically a one-time deal, and you don’t get the opportunity to develop a working relationship with them.
To learn more about how accounts receivable factoring and purchase order financing can be used together to help grow your business, give DSA Factors a call at 773-248-9000. We are a family owned and operated business that works with clients nationwide. Whenever you call DSA, you will always be able to speak with a principal, whether it is Ben, Max, or Howard Tolsky. With over 30 years experience offering factoring and PO financing to our clients, we have money to make your company grow!
One of the most difficult challenges for startups or young businesses is obtaining proper financing so that your business has the cash flow it needs to grow. Often time small or new businesses don’t qualify for a traditional SBA loan, and if they do often times the amount they qualify for isn’t enough to sustain growth.
With accounts receivable factoring, not only does your small business qualify, but there is unlimited potential for how much funding you receive. Even better, with accounts receivable factoring you are selling your outstanding receivables, so you aren’t taking on any new debt. You also no longer need to worry about performing credit checks or making collection calls, plus you can rest assured that all of your receivables are insured.
At DSA Factors we have been providing accounts receivable factoring to small businesses and young startups for over 30 years. We make credit decisions in minutes, not months, so that you can grow your business now, not later. Best of all, we are a family owned company, so whenever you call you can ask for Ben, Max, or Howard and one of us will be available to speak with you.
If you are ready to start growing your business, give DSA Factors a call today at 773-248-9000.
So you’ve heard about accounts receivable factoring. You know with factoring you can improve your cash flow without taking on any new debt. However, you’ve never factored an invoice before and you aren’t sure how to do it. Luckily for you, factoring an invoice is incredibly simple and shouldn’t take you much more time than a minute or two. Here is a step by step walk through of how to factor an invoice.
Request an Approval
Once you receive a purchase order, simply logon to DSA’s web site and request an approval. If it is a customer that you have factored with us before requesting an approval is very easy, all you need is their account number and the value of the purchase order. For a new account that we have not factored for you before, we just need some basic information about your customer. Just provide us with your customer’s name, address, phone number, and the amount of the order. If you have a fax, e-mail, and contact name we appreciate that as well. For existing accounts, you may receive an automatic approval directly on the web page, but if you don’t we will do our best to respond to your request within half an hour. There is no need to ask your customer to apply for credit or provide credit references, we will take care of everything for you.
Ship and Invoice
Once you have received an approval it is time to ship the merchandise to your customer and invoice them for it. We will provide you with a stamp to stamp the invoice with which states that the invoice is payable to DSA Factors. Alternatively, if you do everything electronically and don’t wish to stamp and scan invoices, you can type the wording of our stamp directly onto your invoices.
Send DSA a Copy of the Invoice and Shipping Documents
The same day that you ship and invoice your customers you can e-mail copies of the invoice along with the shipping documents (bill of lading or FedEx / UPS tracking number) to DSA. If we receive everything before our banking deadline we will process the invoices and fund you that same day. If it arrives after our banking deadline then you will be funded the following business day.
Let Us Manage Your Accounts Receivable
At this point there is nothing left for you to do. We will manage your accounts receivable for you. That means that we will send out account statements to your customers, forward them copies of invoices upon request, and make collection calls should an account become past due.
Sign Up for Invoice Factoring with DSA
If factoring an invoice sounds simple enough, signing up with DSA Factors is just as simple. Just give us a call at 773-248-9000 and either Ben, Max, or Howard will be able to answer any questions you may have and get you signed up for accounts receivable factoring. You can start receiving funding in as little as 24 hours.
This week saw the return of the International Home and Housewares Show to McCormick Place in Chicago. As usual Ben was walking the floor to represent DSA Factors. During the show he visited with clients and met with prospective new clients. Overall, based on the crowds in attendance and reports from our clients at the show, the show was a success. While we had some clients who reported not too much activity, others reported tons of activity and have picked up quite a few large accounts at the show. We also met with a large number of startup businesses who are expecting a lot of business as a result of the show. DSA Factors has been providing factoring for the housewares industry for over 30 years now, and it’s always good to see that the industry is performing well.
If you were at the show and met with Ben, we hope that you learned a little bit more about accounts receivable factoring and how it allows you to finance your business without taking on any new debt. If you didn’t get a chance to meet with Ben, we are sorry he missed you, but we would still be happy to talk to you about how we can improve your company’s cash flow.
Now that the show has come to an end, if you have received some large orders, or plan on receiving them in the coming weeks, now would be a great time to get your financing in place. With DSA Factors, not only can you get an advance on your invoices with accounts receivable factoring, but we also offer purchase order financing as well. Call us now so that we can make sure that when those large PO’s come in, that you have the financing you need to take them on.
We hope that the International Home and Housewares Show was a huge success for your company, and look forward to seeing you back in Chicago this time next year. Until then, if you have any questions, or would like to learn more about your financing options, fell free to give Ben a call at 773-248-9000 or e-mail him at email@example.com.
Give your small business the financial momentum it needs to grow with accounts receivable factoring. No need to wait around 30 days or more to get paid for merchandise or services you have already provided. With accounts receivable factoring you get funded the same day you invoice your customers, giving you the cash flow you need to grow your business. To learn more about accounts receivable factoring give DSA Factors a call today at 773-248-9000.
Often times for a new startup business, it can be difficult to obtain financing. SBA loans are usually out of the question as banks will want to see a track record and will require collateral that a startup business most likely wouldn’t have. Venture capital is an option, but is usually reserved for tech companies that have a huge potential for growth, plus often times it requires you to give up ownership of your business. However, accounts receivable factoring is a great way for a startup to finance their business without having to give up any ownership or taking on new debt.
What is Accounts Receivable Factoring?
Accounts receivable factoring is a type of financing where you sell your receivables to a factoring company for a discount. For startups the main benefit is that you get funded the same day you invoice your customers rather than having to wait 30 days or longer for them to pay you for goods or services that you have already provided them. As a result you have healthy cash flow so that you can take on more orders as well as larger orders without having to worry about how you will pay your suppliers. Since you are selling your receivables to your factoring company, the funds they provide you with are yours to keep, there is no need to repay your factoring company as your customers will be paying them once their invoices become due. As a result accounts receivable factoring is one of the few financing options available that doesn’t require you to take on any new debt.
Additional Benefits of Accounts Receivable Factoring
While improved cash flow may be the main reason a startup business would use accounts receivable factoring, it isn’t the only one. Since your factoring company is relying on your customers to pay their invoices in order to get repaid, your factoring company will also handle all of the credit checking for you. For a startup business the last thing you want to do is spend several thousand dollars subscribing to a credit agency so that you can determine whether or not an order you receive is from a credit worthy company. Your factoring company will also handle all of your collection work so there is no need for you to spend time making collection calls and no need to purchase accounts receivable management software. Finally, with non-recourse factoring, your receivables are insured against non-payment for financial reasons. So if one of your customers goes bankrupt or out-of-business you still get to keep the funds that your factoring company gave you.
How Does My Startup Business Qualify for Accounts Receivable Factoring?
Unlike a traditional bank loan, accounts receivable factoring is not a loan, your factoring is instead extending a line of credit to your customers. As a result, your factoring company isn’t too concerned with your company’s credit or your personal credit, but rather with your customer’s good credit. So as long as you are selling to reputable businesses you qualify for accounts receivable factoring.
How Much Funding Can My Startup Business Receive with Accounts Receivable Factoring?
With accounts receivable factoring there is no limit to how much funding you can receive. The amount you are funded is tied directly to how much you have in receivables. So as your receivables grow so does the amount of funding you receive. While your factoring company will assign credit limits to your customers, since you are not receiving a line of credit there is no limit to how much you can get funded.
So What’s the Catch?
Obviously there are fees associated with accounts receivable factoring and these fees can vary based on which factoring company you choose to factor with. At DSA Factors we offer a flat rate factoring fee, meaning that we do not charge you interest if your customers do not pay their invoices on time. The factoring fee we charge is very similar to a payment processing fee that you would pay to take a credit card. So if you can afford to take a credit card, you can afford to offer your customers net 30 payment terms with accounts receivable factoring. While every factoring company charges a factoring fee on each invoice they purchase, these rates do vary and you may be subject to other fees as well. At DSA Factors we do not have any annual fees, there are no fees for setting up new accounts, we have no minimum volume requirements, and we have no long term commitment. Please read our article on how to find the lowest rate for accounts receivable factoring to learn more about what types of fees you can expect to pay for factoring.
What if I Need Additional Help Financing a Large Purchase Order?
Sometimes waiting until you invoice to get funded isn’t enough, especially if you need to pay your factory for a container before they will release it. In situations like this your factoring company may offer you purchase order financing. Purchase order financing is a short term loan that allows you to pay for a container in order to fulfill a large order. Even though you may not qualify for a business loan, since you have developed a relationship with your factoring company, and you will be factoring an invoice as a result of the purchase order, your factoring company may be willing to give you a short term loan to finance the purchase order.
So How Do I Get Started With Accounts Receivable Factoring?
Factoring is a fast and easy process where credit decisions are made in minutes, not months. Getting started is easy, give DSA Factors a call today at 773-248-9000. With just one call you can be well on your way to getting the financing your startup business needs to succeed. We can be funding you for your invoices in as little as 24 hours.
For every new start up, it doesn’t matter how great your product is, but how well your business is funded. Without healthy cash flow it can be very difficult to grow your small business. With factoring, also known as accounts receivable financing, you can speed up your cash flow so that you can take on larger orders and grow your business. To learn more about factoring and start growing your business call DSA Factors today at 773-248-9000.
Accounts receivable factoring is a quick and easy way to improve your cash flow. In addition to improved cash flow, your factoring company will also handle all of your credit checking and collection work while insuring your receivables. Give DSA Factors a call at 773-248-9000 today, and we can be funding you in as little as 24 hours.