How We Get You Cash
There are two ways we get you the cash you need to keep growing your business: factoring (accounts receivable financing) and P.O. financing. While both services generally work the same way, the situations for which they are appropriate differ.
Purchase Order Financing
P.O. financing is perfect when you get a big order but don’t have the resources to fill it. You need the work and don’t want to turn it down, but the banks won’t help you and time is running out. You bring us the purchase orders, we’ll finance them so you can acquire the necessary inventory and keep your business moving forward.
What is Factoring?
Factoring is a way of turning current receivables into immediate cash.
We purchase your outstanding receivables, so you don't have to wait for two months to have money you need now, or worry about the collection and administrative hassle. You can fill those orders and grow your business. When you need money and your bank isn't helping, this is your best way to get operating cash without giving up control. If you have a big opportunity to grow your business, don't turn it down - get some operating cash from Prairie Business Credit, and keep your business moving forward.
Who Benefits from Factoring?
Factoring is a great solution for anyone who needs operating capital and can't get it from the bank. It works for businesses in nearly any industry that are making sales and trying to grow. It isn't, however, for everyone. Give us a call to find out how we can help.
What is Factoring Used For?
Growth. Making ends meet. Opportunity in a moment of great potential, or relief in a time of distress. Factoring works any time you need immediate operating capital. You could use it to maintain inventory, purchase equipment, make payroll, procure supplies, upgrade hardware and software, take advantage of vendor discounts, pay taxes, or fulfill a big order - anything that keeps your company growing.
The Cash Gap
The Cash Gap is that uncomfortable period of time between a company's payment for materials or services and its receipts from product sales. In order to grow, a company has to bridge the cash gap. Some diagrams of the cash gap in a few industries:
Working with Prairie Business Credit, you eliminate the cash gap. This frees you up to pursue orders and opportunities you might be tempted to pass on.
When Should I Factor My Invoices?
When the gross margin on the next sale is greater than the cost of factoring. When the money saved with trade discounts, reduced administrative and collection costs offset the cost of factoring. When accepting new business (and keeping it by factoring!) increases your bottom line. See Company on Fire.
