Here in the United States, small businesses are hugely important. With more than twenty five million of them scattered across the country (twenty eight million of them, to be more precise), there is no doubt that they are incredibly prevalent as well as incredibly varied. In fact, small businesses – which are defined as having fifty employees or even less – make up more than ninety nine and a half percent of all of the businesses that are based here in the United States.
Unfortunately, it is not uncommon for small businesses to struggle due to a lack of cash flow, the reason that more than eighty percent of businesses that fail ultimately end up not being able to stay open. A lack of cash flow can come from a number of different things, but one of the biggest is that of a lack of invoices paid on time. Unfortunately, invoices are paid late more than they are paid on time, with data that has been recently gathered showing that up to sixty percent of all invoices are paid late – if they are paid at all.
For the larger company, this is not ideal, but it is also not really that big of a deal at the end of the day. There is enough funding and the company is large enough to, in most cases, absorb that cost – at least until the invoice is eventually paid. However, this is not the case for small businesses, to whom every penny matters. In many cases, a lack of invoice payments that are paid on time can be devastating to the typical small company.
Fortunately, the International Factoring Association and invoice factoring can help. The International Factoring Association provide invoice factoring, ranking from a trucking factoring service to small business invoice factoring. If you don’t know what invoice factoring is, it is actually relatively simple: a loan is given to the companies in the amounts of currently unpaid invoices. Once the invoices are paid, then the loans themselves can typically be paid off.
There are different terms for the factoring loans as provided by the International Factoring Association, and the amount of these loans will depend on the circumstances, such as the number of unpaid invoices that a small company is dealing with. Typically, a factoring loan as provided by the International Factoring Association will be for the invoices of the last ninety days. However, sixty day loans and one hundred and eighty day loans are certainly not unheard of. Again, it is all situational and based on the circumstances of the small business that is in question itself.
In many cases, the invoice factoring payment – no matter what amount it is – makes a huge difference for the small business that has received it. In. fact, it can even be impactful enough to save any particular small business with funding and cash flow difficulties from needing to close, even temporarily, until getting the invoice payments that they are owed. As the International Factoring Association can surely attest to quite easily, factoring loans from freight factoring companies, trucking factoring companies, and the like can make the difference of night and day, no ifs ands or buts about it.
However, it is important to remember that factoring loans that are given out by the International Factoring Association are still loans – and still must be treated as such. It’s important to keep track of the loan, as well as to keep track of how much has been paid off of it. This is essential, and should be a top priority for every single small businesses that has received an invoice factoring loan such as the ones that have been mentioned above, earlier in this article. The Invoice Factoring Association is likely to be able to work with you to pay off your loan, but it is still very important to pay off this loan as quickly as you are possibly able to, as reducing your debt as much as you can is always something that you should be striving to do, especially as the owner of a small business of any sort.