As a busy business owner or Chief Financial Officer, we understand that you have a lot on your plate. You have a responsibility to meet or exceed the expectations of your clients, employees, and perhaps most importantly your executives and investors. Coming to the realization that cash management issues, or perhaps rampant growth, have resulted in a lack of working capital can be quite shocking. However, if and when this occurs in your business, we want you to know that The Commercial Finance Group in Atlanta is here to help.

As one of the most trusted commercial factoring companies in the Southeastern United States, we take great pride in presenting a full menu of finance options who need access to more money in a rapid fashion. From factoring to asset-based lending, we deliver it all.

We also understand that, as a busy business owner or executive, you’ve probably spent most of your career focusing on something other than the intricacies of factoring and similar financial services. That’s why we’ve prepared this simple guide to understanding more about factoring and how it differs from another financial service called “invoice discounting”

Factoring And Invoice Discounting Deliver Similar Benefits

First, it’s important to acknowledge that from your viewpoint as a consumer, factoring and invoice discounting may seem to deliver very similar benefits. This is an accurate and astute observation. Although there are very significant ways in which factoring and invoice discounting are executed and affect the business’ financial standing, they deliver a set of overlapping benefits.

Main Benefits Of Factoring And Invoice Discounting

  • Releasing up to 90% of the value of all outstanding invoices in less than one day’s time
  • Delivery of funding without putting up assets as collateral
  • Relief from cash flow issues that may be inhibiting growth
  • Access to discounts from vendors who may value prompt/early payment
  • Competitive pricing

Now, let’s take a look at some of the ways in which factoring and invoice discounting differ, which may help you to decide which method is right for your business and current financial situation.

Who’s In Control?

When you take advantage of factoring finance solutions, you forfeit control of your own sales ledger. This may seem like a drawback until you realize that it means you’re no longer responsible for chasing down customers who have unpaid invoices or managing the credit control of the business. While the relief gained from solving cash flow problems typically overcomes any hesitation business owners may have about this fact, it is definitely something that should be considered before proceeding.

Who Knows You’re Using Short-Term Financing?

Unlike factoring, in which it will quickly become obvious to your customers that the task of collecting and processing invoices has been turned over to a third party, invoice discounting happens almost exclusively in the background. If you’re a business owner for whom appearances are everything, this may be the solution for you.

Is Factoring Right For Your Business?

There are no cut and dry rules about who should take advantage of factoring finance and who should take advantage of invoice discounting. The only way to decide is to contact The Commercial Finance Group in Atlanta for a customized consultation today.