Many Industry Sectors including Transport and Distribution by their nature are very exposed to the variations within economic cycles.  Irrespective of turnover or size, for businesses their priority is often to keep their fleet on the road and to keep it moving. When it comes to managing cash-flow, Factoring can provide an effective solution to maintaining a steady stream of working capital through a business, ensuring that drivers can be paid, vehicles can be re-fueled and the movement of goods throughout the UK and beyond can continue. If your business turns over at least £100,000, a Factoring arrangement will work by releasing up to 90% of your invoice value typically within 24 hours, so that you don’t have to wait up to 90 days for payment.

Here are the benefits of how Factoring can benefit your business:

• It is a quick and effective method of releasing equity tied up in your invoices as it increases your cash flow and allows you to keep up with vital fuel expenses and operating costs
• It allows you to out-source your credit control and ledger management, leaving you to focus on managing your business and perhaps reducing your staff headcount
• There are Factoring firms who include fuel card services by, releasing cash flow from this critical day-to-day expenditure
• You can add bad debtor protection to your funding facility, providing peace of mind and stability

Confidential Invoice Discounting (CID)

CID works very similar to factoring in that it provides up to 90% of the value of your outstanding customer invoices as cash to improve the flow of funds into your business. The difference between CID and factoring is that you continue to handle the credit control and the service is confidential as your customers are unaware of the facility. Invoice Discounting is normally more suitable if your business has turnover of £250,000 or more, and has well-established systems and procedures in credit control and sales ledger management. Many businesses like the anonymity offered by invoice discounting, this is particularly important if you have good, solid, long-lasting relationships with your customers.

Here are some further benefits of CID:

• The revolving facility means you don’t need to make capital repayments therefore maximising your available cashflow this enables you to grow your working capital in line with sales
• It is a quick and effective method of releasing equity tied up in your invoices as it increases your cash flow and allows you to keep up with vital fuel expenses and operating costs
• A secure online system is common practise that enables you to easily send monthly sales ledger transactions
• The discounter releases up to 90% of the value of the invoice, typically within 24 hours. Once your customer settles the invoice, the remaining balance is sent, less the agreed service fee

Selective Invoice Finance

We work with specialist financiers who can provide advances on one-off invoices, or multiple batches on an ad-hoc basis. Rather than waiting 30 to 120 days for payment, Selective Invoice Finance allows you to raise the cash you are owed, against one or multiple invoices as and when there is an urgent requirement. It’s a very swift and easy way to support short term cash flow, without long term contracts, set up fees or minimum term agreements.

A selective facility works in four easy steps:

• Choose one or multiple invoices that you would like to fund
• Receive up to 80% of the invoice(s) value
• When your client pays, we deduct our fee and you receive the remaining balance
• If your client pays early, this benefits you as we only charge a fixed daily rate meaning you only pay for what you use

To find out how Advance Finance & Leasing could make a positive difference to your working capital funding, please get in touch at enquiries@advanceleasing.co.uk