Factoring Companies for Staffing Agencies
Consistency From Start to Finish...
When Joe Fisher spun off Galileo Staffing Services from a sister company, the access to easy credit they were used to, also disappeared. "We have substantial high volume customers with slow payment terms, being a staffing company, supporting weekly payroll was paramount. There is an abundance of factoring companies, but we quickly became comfortable with Gateway Commercial Finance."
Since Gateways inception, prospects have always dealt with a decision maker,no salesmen, sales managers or credit committees to blur the communication between business owners. "After our initial conversation, we knew we had the right partner to support our needs. They did everything they said they would, when they said they would do it. I appreciate that in a business partner!"
...Talk is Cheap
Pick the Best Factoring Staffing Factoring Company
Whether launched from scratch or spun off from another company, new businesses often face significant hurdles when it comes to managing cash flow. That’s especially true if the business operates in an industry with long payment terms, such as staffing. The invoices may not get paid for weeks or even months, but the company still has to pay its employees, vendors, and other bills.
Factoring can be an effective solution to overcome those long pay cycles. With factoring, a partner company - called a factor - provides you with partial upfront cash as an advance on your outstanding invoices. Those advances are often as high as 90 percent.
Your customers then pay the outstanding balance directly to the factor. Don’t worry, though. An experienced factor will have processes set up to protect your privacy. Your customers won’t know that they’re submitting payment to a third party. Once the factor receives payment on an invoice, they keep a small fee for their services and then forward the balance on to you.
With factoring, you get cash fast, almost as soon as you issue a new invoice. That can help you keep the business running and it can eliminate the painful wait for invoices to get paid.
As Joe mentions, though, it’s important to have the right factoring partner. There are many factors out there, but not all of them have the resources, experience, and infrastructure needed to provide you with the service, funding, and discretion you need.
One thing to look for in a factoring company for your staffing agency is how easy it is to talk to a decision maker. At Gateway, our customers always speak directly to decision makers. You won’t speak to a salesperson or sales manager. There’s no credit committee that blurs the decision-making process.
Instead, you speak directly to the individual who will make the decision about whether or not your invoice will be approved and factored. That kind of access is important because it gives you the transparency and insight you need to make cash flow decisions.
At Gateway, we’re also transparent about our process and fees. You’ll always know what our collection process is and how we protect your privacy so your clients don’t know that a third party is involved. You’ll have clear guidance as to when you will receive your funding, how we process payments, and what your net payment will be.
You want to work with a factor who is a partner in your cash flow success. They provide you the information you need to make sound planning decisions and they have processes in place to protect your relationship with your clients.
Factoring may be the right funding solution for your growing business. However, take the time to do your due diligence. Ask good questions and make sure you’re talking to a funding decision maker, not a sales rep. With the right partner, factoring can help you overcome even the toughest cash flow challenges and keep your business running smoothly.