Many businesses who invoice their customers struggle to keep money flowing, especially in the early phases. This is a result of the invoice, taking 30 days or more to be paid, which can halt money coming in and potentially cause significant financial problems. Here is a short guide to invoice finance and how it can help your business.
Cashflow is incredibly important in any business, as having a steady source of money coming in serves to help it run as smoothly and efficiently as possible, and allows you to make decisions safe in the knowledge that you have funds to back them up.
When cashflow comes to a standstill whilst waiting for invoice payments, invoice finance can help get it moving again swiftly, as it involves selling the invoices to a lender for a large percentage of the profit. The customer then pays the lender, who in turn pays you the rest of the money having deducted their fee.
Take on Bigger Clients
With a far steadier and more reliable source of money coming in, and the knowledge that you can access funds immediately (often within 24 hours), you will save a lot of time waiting and can focus on the things that matter, like your clients.
Since you will have the lender paying your invoice so quickly, you can take on jobs from clients which you normally might not have the funds to cover (due to waiting for another invoice payment). This is a great way of generating more profit and prevents you having to give up opportunities to competitors.
Speed Up Growth
Ultimately, invoice finance will help lead to accelerated growth, as it will generate more money for investment in your business. This means that you are free to focus on areas which need improvement, and can be sure that you will have funds to do so. Services like Touch Financial can offer you a helpful insight into which lender might be best suited to your business growth needs.
Rather than getting caught up in a labyrinth of unpaid invoices, you will have the spare time and money to make your business the best it can be, and likely attract even more clients as a result.
Ultimately, invoice finance helps to address one of the biggest deficits faced by businesses today: time. With more time on your hands, as well as a far smoother cash flow, invoice finance could be the key to taking your business to the next level, and ensuring that all important growth.