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Accounts receivable financing is used by businesses to convert sales on credit terms for immediate cash flow. 1st Commercial Credit adopts a quick and simple approval process and expedites initial funding in 3 to 5 working days.
learn moreAccounts receivable financing (AR) is a financing agreement in which a Tacoma company receives immediate working capital based on a percentage of its accounts receivable. These AR arrangements are structured in many different ways, but the most common include either an asset sale or a loan. Accounts receivable are considered assets reported on a company’s balance sheet equal to the amount of outstanding invoices billed to customers.
Accounts receivable are a type of highly liquid assets for financiers and lenders. Accounts receivable financing services are also known as factoring. A cash flow lending company will usually focus on the specific needs and will try to accommodate and structure a funding agreement that will be beneficial for both entities.
For many Tacoma businesses, it has become increasingly difficult to obtain capital from a bank. Often the bank loan has a long list of requirements, and the process is rigorous. One of those requirements is having a substantial and established history of credit which might be impossible for many small businesses. Bank financing also involves a lengthy and complicated process. Because of these and many more barriers to traditional bank lending, many entrepreneurs and startups have begun seeking alternative forms of funding like AR financing.
Accounts receivable funding allows businesses in Tacoma to get access to immediate cash without having to go through the time-consuming and challenging bank loan process. If your company uses accounts receivable for asset sales, it will not worry about repayment schedules or collections. When a company decides to apply for a factoring loan, it can immediately receive a large percentage of the total value.
Owners of a freight and trucking company sometimes feel the waiting game to get paid can sometimes be eternal. Payment terms for an invoice can take several weeks or even months before receiving payment. The issue arises when unpaid freight bills accumulate, causing the money that should be in cash flow to be stuck in these invoices.
This situation will limit your company’s ability to grow and will also cause cash flow issues. Freight factoring companies are experts in this industry. These lending companies can offer a variety of financial services for trucking companies.
Trucking factoring companies in Tacoma will give you an advance on your unpaid invoices, and they will take care of collecting payment directly from your customers when the invoice payment is due. Businesses must do their research to find the best factoring company for trucking businesses. A long-term relationship will be developed, and business owners will want an experienced factoring company to fulfill their ever-changing needs in the future.
Unpaid invoices can cause a business to be unable to pay its employees, pay for rent, or cover other emergency expenses. Truck factoring with 1st Commercial Credit has more than 18 years helping businesses solve their cash flow issues and can quickly assess your situation.
To summarize, here is a shortlist of some of the Advantages of Trucking Factoring Companies:
Medical facilities billing to Medicare, Medicaid, and other major insurance companies may experience cash flow challenges due to slow payment from these insurers and increased service demand from patients. These cash shortfalls can present problems in managing staffing costs, operational expenses, and other necessary business expenses in the healthcare sector. Receivables lending can often provide added financial resources to close the gap between the delivery of medical services and payment by insurance companies. Traditional lenders offer loans based on the creditworthiness of the business and an assessment of their capability to pay back those loans.
These lending institutions are often limited in the forms of collateral they can accept. Some of the most forms of security used by these loans include real estate, medical equipment, and vehicles. By contrast, medical factoring lending arrangements use outstanding invoices to collateralize loans. The healthcare provider receives funds almost immediately for those invoices, allowing administrators at the facility to manage financial obligations in a timely way.
Healthcare factoring companies will focus and look at the creditworthiness of the companies or agencies owing money to your business. Medicaid and Medicare invoices offer the most significant security for the lender as these debts are guaranteed by the full force of the federal government. Major insurance companies are only slightly less reliable in terms of collateralization. By using these debts as collateral for short-term lending financing or lines of credit, healthcare facilities can acquire the necessary funds to manage cash flow difficulties more effectively.
Usually, a medical factoring arrangement can be evaluated in a way faster manner than traditional banking loans. In most cases, 1st Commercial Credit can offer decisions within one or two business days. Disbursements can be made quickly, making these loans an ideal way to manage unexpected shortfalls or other financial emergencies for healthcare providers. With these financial tools, the medical facilities and administrators can ensure a reliable and consistent supply of funds to manage ongoing expenses.
1st Commercial Credit delivers fast processing times for account receivable lending arrangements. The rapid response and funding of loans and lines of credit for the healthcare industry is a valuable asset for smaller medical facilities that depend on invoice payments to meet their financial obligations.
Working with government contracts offers excellent opportunities for any Tacoma business. The government is a reliable client that will eventually make payments. The problem is, those payments sometimes can take 30, 60, or 90 days before they are in the company's hands. With this in mind, taking on a government project could result in draining your working capital while waiting for payment. Invoice factoring offers a solution so you can continue servicing the government by closing the cash flow gap created between project completion and final payment.
Factoring government receivables ensures a business owner gets the cash it needs upfront to cover all operational costs and payroll. A large contract with the government can potentially empty your cash reserves and make it challenging to continue running operations and servicing other clients. Whether you're working for the Department of Transportation or a local school district, factoring can help you get through all these contracts without draining your cash flow completely.
Factoring government contracts is an easy process for 1st Commercial Credit. Contact us for an assessment, and we will provide various financial solutions that can fulfill your business needs. Factoring government receivables is fast and straightforward. It is a debt-free financing method that involves using your unpaid government invoices and selling them to a factoring company in exchange for early payment.
Businesses go through an easy application process, and once approved, invoices can be submitted. When the factoring company verifies these invoices, your business receives the money in the bank account within 24 hours. Advances can range from 80%-97%, and the remaining percentage is held in a reserve account. When the factoring company collects full payment for the invoices, your company receives the remaining amount minus a factoring fee.
Tacoma has more than 2,700 acres of port property, is home to the 7th largest container port in the country, and trades about $46 billion in goods a year. Tacoma’s thriving maritime industry is a major center for bulk, breakbulk, and automobiles cargoes and supports 29,000 jobs. Additionally, Tacoma is ranked as the best region in the country for tech jobs. Art and culture is another significant component and contributor to Tacoma’s economy, considered the 2nd-most museum-dense city in WA.
The art and culture sector brings more than $137 million in revenue every year and supports 3,656 jobs. Several major healthcare companies are based in Tacoma, including MultiCare, Health Systems, CHI Franciscan Health, and Kaiser Permanente. The Seattle-Tacoma region is a significant zone for aerospace innovation. Lastly, Tacoma is also a major location for financial institutions, and construction is booming and is considered one of the fastest-growing sectors in the country.
Tacoma is on the rise. It has a revitalized and vibrant downtown and is a location that offers many opportunities for investment and growth. The city's mission is to facilitate economic growth and opportunity for existing businesses while enabling investment and revitalization and promoting the creation and attraction of new companies. Tacoma has a population of around 218,000 people, including a diverse mix of cultures. Tacoma offers an invaluable quality of life and an affordable lifestyle. The city’s location also makes it an ideal place for an efficient supply chain and international trade with the Pacific Northwest consumer market.
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