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Funding Fundamentals  :  Managing Customer Fears

Managing Customer Fears

Tips for Managing Customer Fears About Accounts Receivable Financing or "Factoring"

Many companies unjustifiably worry that their customers will misinterpret their decision to use Purchase Order and/or Accounts Receivable Financing as a signal of financial instability. Deciding to use these forms of financing is actually an indication that your business is solid, rapidly growing, and in high demand. In fact, in today's challenging credit markets environment, financing through Accounts Receivable Factoring is becoming the norm for many industries.

To help allay your concerns and to educate your customers about Purchase Order and Accounts Receivable Factoring, consider the following:

  • Accounts Receivable Factoring businesses work only with companies that qualify for credit.
    Similar to getting a bank loan, companies are subject to due diligence before Promotional Capital agrees to provide financing. Moreover, the ability to finance your accounts receivables is dependent on the creditworthiness of your customers, not your company.
  • Invoice Financing is beneficial for both you and your customers.
    Your customers probably take from 30 to 90 days (or more) to pay for your goods or services. By factoring, your customers continue to receive your services and have time to pay for them—in other words, it's business as usual. The only difference with invoice financing is that your company benefits from having money today, in order to more readily satisfy current obligations, while still experiencing growth.
  • Purchase Order Financing and Accounts Receivable Factoring is a smart business move for growing companies.
    A business most often uses Purchase Order Financing and Accounts Receivable Financing or Factoring to expand and take on larger deals, without compromising the quality of their products and/or services. By getting money sooner rather than later, your business has the resources to focus on critical success issues—sales, operations and growth—while still meeting its demand.
  • You may have customers who deal with factors and are not aware of it.
    Various businesses in nearly every industry factor their receivables, and therefore are already familiar with how factoring works and why companies choose to do it. Accounts Receivable Financing/Factoring is one of the oldest methods of providing working capital to help businesses solve their cash flow needs. It's also a part of your everyday life—every time you use a credit card, you're engaged in the process of factoring.

Educating your customers about why you decided to use Purchase Order and Accounts Receivable Financing should eliminate many of their concerns. You should also know that Promotional Capital is always available to help explain your new financing program.

For too long, this type of financing was only available to huge corporations. Now Promotional Capital provides Purchase Order and Accounts Receivable Financing services to companies like yours, so you can enjoy both the recognition and the reality of being a stable, growing, profitable business.

Ready resolve your working capital issues?

Apply today for promotional capital Factoring!

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