An industrial service business in Philadelphia recently entered into a factoring arrangement with a well-established factor because it was in need of short-term working capital assistance and decided on a factoring arrangement instead of a traditional line of credit. Since the business’s customers are of high credit quality, factoring was a logical credit facility for them to turn to. The business has been factoring invoices for several months now and is extremely pleased with the arrangement. The owner especially likes the fact that he can use the factoring company’s online system to determine how much money he can borrow through factoring at any time, 24/7. This is a big help when it comes to daily cash flow and working capital planning.

A small business consultant met with a couple who owned a safety products and supply distributorship, who had asked him for help in cleaning up their books. The consultant soon realized there was an accounting issue that had created a significant tax problem. The business was viable, though, and new orders kept coming in, so the consultant referred the couple to CFG. Just about this time, though, the tax authorities froze their business accounts. Fortunately, we were in a position to help by negotiating a release and payment plan with the tax authorities on the couple’s behalf. Today, the business is performing much better and they are looking forward to a strong year. With good record keeping in place and CFG as their financial partner, the couple can focus again on selling.

“We first got involved with CFG after our banker told us we had become “unbankable”. He told us he knew of a company that could probably help us and that is when we were introduced to Tracy Eden. From the very beginning you could tell Tracy was honest. He told it ‘how it is…how it really is.’ He didn’t lead us on or leave us hanging in the wind like several banks had done…he was honest from the start and let us know whether or not he could help us. That same honesty has continued whenever we have approached him on other things since then. If it’s something he can’t do for us, he tells us. The transition was good. For me, things make more sense when I can see everything detailed in an Excel spreadsheet. Once I saw the Excel template that CFG uses, my mind was immediately put at ease. It’s been a year now and things have been going great. I have to say that 95% of the effort is handled between our office manager and our CFG account executive. There was a little bit of a growing pain in trying to figure out exactly how we do business and what kind of paperwork CFG needed from us, but that only lasted a month or so. Once we got that lined out everything has been great since. We feel like we are dealing with ‘real people,’ not the typical bankers who make you feel as if you [...]

When it first started out in the late 1990s, a janitorial services company in Arizona quickly realized that the payment terms of its corporate and government customers weren’t going to sync up with its expenses — payroll, vendors, equipment, and supplies. “We had to pay all these expenses while waiting to get paid by our customers,” says the owner. “But we didn’t qualify for a bank loan or line of credit because we were a brand new business.”The owner talked to CFG about A/R financing, which ended up being a perfect solution. “If we had to wait up to 45 days to receive payment from our clients, we wouldn’t be able to meet our expenses,” she says. “Accounts receivable financing from CFG enabled us to get the business off the ground, and it’s still beneficial for us today.” The business now has a small bank line of credit, which it uses in addition to A/R financing in order to meet its cash flow needs.“We have a very strong relationship with CFG,” says the owner. “They bend over backward to help us.”

Temporary and IT placement firms, security companies, janitorial service providers, and translators are a few examples of service industry firms that are relying more on accounts receivable (A/R) financing. CFG has been providing A/R financing to a translation services provider in Canada since 2010. The owner of the translation company says that most of its large customers pay invoices in 60 to 90 days, but they must pay their contractors (translators) in 30 to 60 days. “And now we’re bidding on some large government contracts that we can only bill quarterly, and then they take 45 days to pay. So this is a potential 135-day payment cycle.” The owner approached CFG to discuss A/R financing after its bank credit line was shrunk. “We were having to turn down large contracts because our cash flow wouldn’t allow us to take on the business,” says the owner. “Accounts receivable financing was our last option.” Each week, the company sends a report to CFG for validation that includes all of its invoices for the week. It then receives funding for 85 percent of the value of qualifying invoices the next business day, and the reserve amount (the balance less fee) after the receivables have been collected. “It’s a straightforward process that has worked very well for our business,” says the owner.

“We were having cash flow issues, needed additional working capital and were not able to secure additional credit through our bank. As a result, our banker referred us to CFG. We had talked with other factoring sources in the past, but were leery of the structure and relationship. However, CFG came highly recommended to us by our banker. Our banker even participated in the initial meeting with CFG and not only helped us to attain a comfort level with them, but similarly our banker helped CFG attain a comfort level with us. We have been with CFG for a year now and the relationship has worked exactly as proposed. CFG has not only supported funding our agreed upon credit line, but they have engaged with us on new proposals and helped identify funding sources for new programs, whether it come direct from CFG or from a source recommended by them. We have been impressed with the customer service from all levels of the organization throughout our relationship with CFG. CFG is a true business partner and we value the relationship. The operating relationship has been outstanding as well. However, from an owner perspective, we value more the collaboration, insight, and recommendations that CFG has provided to help the overall bottom line and becoming bankable again. CFG is truly in it to get out of it. We understand that eventually CFG will no longer be a credit source for us, but we hope to still maintain that relationship beyond the end [...]

A Norwegian engineer and his Swiss wife arrived in the U.S. with a couple of patents and the dream of owning their own business. Their best product was a unique plastic item used to heat green commercial buildings, but the timing wasn’t good and sales were poor. However, things began to improve considerably for the company two years ago as large orders from overseas began to come in and domestic sales started picking up. But the overseas orders tied up their working capital for long periods of time, and they didn’t have enough inventory to fill some of their domestic orders. A local banker introduced them to CFG, and things have really turned around since. By focusing on domestic sales, they have predictable cash flow so they can keep ahead of the orders. Extremely rapid sales growth is expected through this year, and with CFG’s support, they are poised to handle it. Their bank, meanwhile, is continuing to provide ancillary services while monitoring their progress, and one day will take over the line of credit whenever they can.