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Receivables Factoring

Your open invoices are valuable and can provide your company with the immediate funds you need to run your day-to-day operations. We can help you get access to those funds quickly with accounts receivable factoring.

Poor cash flow can affect any business’ ability to pay employees, pay suppliers, and bring on new business. This financing tool helps companies that are cash constrained because their customers routinely pay invoices in 30 to 60 days, or more. 

Factoring can help you resolve these problems by providing cash to your business based on the value of your open invoices. Different from a loan, factoring means we purchase your invoices at a discount, providing you with immediate cash. A simple and effective process, factoring concludes when your customer pays its invoice in full.

Factoring can be a great solution to increase working capital and offers access to cash within hours of invoicing. In addition, our clients have the flexibility of choosing specific invoices while increasing their cash flow without debt. It’s a scalable approach to your business capital needs, with your access to capital growing as your business grows.

Access to Cash

By designing a factoring program, SLK Finance helped a Midwest-based device and software services company maintain valuable relationships with its key suppliers and, more important, continue to grow its business.

The company manufactured components valued at roughly $500 and managed service contracts for up to $600,000. Although it was doing well, continuing to grow meant new and larger customers, contracts, and extended payment terms. Like many growing companies, most or all of their working capital was invested in inventory and daily operations. The company could build cash reserves slowly over time but would need to either turn away new business or begin to pay its supplier partners more slowly.

Instead, we financed its accounts receivable, which provided needed cash. The process was straightforward and allowed the company to choose the invoices that we factored and, upon approval, receive 80% of the value in just a few hours. We then transferred the remaining invoice value, less the factoring fee, upon receiving customer payment. This process was invisible to customers who only received a letter from SLK stating that it was a financial partner helping to grow the company’s business.

With benefits like flexibility and speed, it’s easy to see why factoring is an attractive solution to business capital needs. This type of program commonly reduces time outstanding by up to 20 days. However, for this particular company the biggest benefit was the freedom to grow its business without the cash constraints that would have delayed or caused it to miss opportunities.