Receivables Funding In Canada . The Good , The Bad And The Ugly ! Sales Of Receivables Factoring Wor

It's probably just us,customized bobbleheads, but when it comes to business financing in Canada no other method of financing your business is as controversial or misunderstood as sales of receivables financing,custom bobblehead, aka factoring funding.Let's examine some key points that will clarify the ' Good,personalized bobble heads, Bad and Ugly ' of receivable financing in Canada.Let's start off with the ' good ' as we think you will soon might find that the ' bad' and the ' ugly ' are simply misunderstandings ,personalized bobblehead, but we'll let you decide.So whey do Canadian business owners and financial managers embrace this newer form of financing in Canada. Simply because it supercharges your cash flow - by selling your A/R you in effect maintain cash flow for operations, and eliminate the need for additional debt or taking on or putting in new equity. We constantly remind clients that the dilution of your equity is in fact the costliest method of financing, everyone pretty well agrees on that.Another point in our ' Good ' column is that if structured properly your sale of receivables financing sets you up for unlimited capital and cash flow - simply speaking your working capital grows lock step with your sales. Not too many other methods of business financing can make that statement.The Ugly. The following point is simply the most recognized complaint when we talk to clients. It involves the mechanisms under which A/R financing works. 99% of the structures used by factor companies involve the factor firm validating the credit worthiness of your clients, and getting involved in the billing and collecting of your receivables. Why. Their answer would be that you have sold them the receivable and it's theirs to collect.So that's bad,customize bobblehead, right? Most Canadian business owners and financial managers that we speak to would say they would prefer to bill and collect their own receivables,personalized bobbleheads, and maintain those client relationships that are so important. Enter ' the good '! Here's the good news, most Canadian businesses contemplating sale of receivables funding / factoring are eligible for what we term ' Confidential receivables financing '. Utilizing that mechanism your firm bills and collects its own receivables,Golf Swing Tips Everything You Need To Know,., maintaining total control on the billing and collection function. You in term remit those funds to your finance firm,customized bobbleheads, simply because you have been advanced those funds already.The Bad. Here is where misunderstanding reigns supreme in A/R financing. It's the ' price ' or ' cost ' of this method of business financing. When you finance a receivables portfolio a factor firm buys your A/R at an ongoing discounted price. That price,custom bobbleheads, on balance,custom bobblehead, in Canada is 2-3%. Business owners in Canada confuse that purchase discount fee as an interest rate,custom bobblehead,The Best Furniture Stores San Jose CA, and that's a large part of the problem. In reality its how you manage that 2-3% that ultimately reflects your total cost of financing. You can manage that cost by adjusting part of the cost into your cost of sales - we remind you that you're already absorbing a large cost by carrying receivables and inventory already. And by the way,personalized bobbleheads, with that new found sale of receivables funding cash flow you can now take supplier discounts if they are offered, which by the way,Design Your Own Wedding Dresses Online, are generally in the 2% range. Want more good,personalized bobble heads, rather than bad or ugly?! You can now enhance your purchasing power with suppliers,customize bobblehead, and if you choose (not always recommended by us) you can offer extended terms to your clients that your competitors might not be able to.The bottom line today. Thousands of Canadian businesses embrace sale of receivables funding / factoring everyday. Consider speaking to a trusted credible and experienced Canadian business financing advisor to wade through the good of this method of business finance,DIY Floral Monograms,custom bobbleheads, and you might just find that bad and ugly are either misunderstood or don't exist . That's a working capital solution!