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Debt factoring is an excellent alternative source of finance for businesses by significantly improving their cash flow. With debt factoring, a business can release immediate cash from their invoices with the help of a factoring company, instead of waiting for 30, 60, or even 90 days for their customers to pay.

Starting and operating a small business is rewarding and exciting, but it comes with a host of challenges that can’t be denied.  From managing start-up and growth costs, marketing, finding customers, and creating positive cash flow, it’s no wonder that not all new businesses make it past their first few years – and no wonder many business owners lose sleep over it.

Debt FactoringAccording to a recent article in the Financial Review banks have forgotten how to bank small business and have created a space for alternative lenders. “They are supposed to be a SME bank and say they understand business but only when it suits them. I’ve heard nothing from them, they’ve chewed me up, and spat me out after a quarter of century”, according to an aggrieved ex long-term customer of the NAB.

If you’re struggling to create the cash flow necessary to hire a new employee, buy new equipment, ramp up production, or just not getting the support you need from your bank, you should seek alternative cash flow solutions such as debt factoring from an Australian factoring company.  Debt factoring can be a flexible alternative to traditional business loans provided by restrictive banks who don’t always step up to help businesses when they need it most.

What are the alternatives to big banks? 

As a small business owner, you owe it to yourself to explore the options that will help your business succeed. A variety of non-bank lenders have sprung up to fill the need left by legacy banks. Debt factoring is another solution.

Debt factoring gives you access to money you’ve already earned, but don’t yet have in your account because of outstanding invoices.  If a client takes 30,60, or 90 days to pay an invoice, they’re sitting on your money for that long.  It can take a strain on your cash flow when all your clients are taking a long time to pay. That is money – your money – you could use to fund your next growth project or simply to keep your business going.  Instead of waiting for it to trickle in, you can use debt factoring to get most of it now. 

How debt factoring can improve your cash flow 

Positive cash flow can mean all the difference for your company. These are just a few of the ways debt factoring will change your business for the better:

  • Create cash flow: With cash-in-hand, you can hire that new employee, expand your operations, or focus on growing your business.
  • Manage slow payments: Debt factoring isn’t a loan. It’s simply giving you access to the money you’ve already earned, bridging the gap (of 30, 60, or even 90 days) between a successful sale and actual payment.
  • Meet operating expenses and improve working capital: Working capital reflects your ability to take care of short-term debt and day-to-day operations. Small businesses haven’t always had the time to amass much working capital, and it can be a struggle to meet daily needs until your business gets on its feet. The cash you receive via debt factoring can help you stay on top of bills and negotiate discounts with your suppliers because you’re able to pay earlier or order in bulk. 

How debt factoring works 

Cash flow is one of the biggest problems faced by Australian businesses, and debt factoring can help solve it.

Debt factoring– also known as debtor finance, invoice finance, factoring, cash flow finance and invoice discounting can help improve your business cash flow by instantly unlocking the cash tied up in your accounts receivable.

Key FactorsBy factoring outstanding invoices to factoring companies known as factors, businesses get paid immediately instead of waiting up to 90 days

Key Factors debt factoring service is flexible and fast, where invoices are often funded within 4 hours.   

To get access to instant cash flow simply invoice your clients, select the invoices you would like funded and send Key Factors a copy.  Key Factors will advance you up to 80% of the invoice value, in as quick as 4 hours. Once your client pays the invoice to Key Factors, we will credit you the remaining 20% less any accrued fees.

What invoices can be considered for debt factoring? 

Invoices relating to business-to-business transactions can be considered, not consumer receivables.

Invoices that are still within normal trading terms not bad and doubtful debts.

Invoices for goods delivered and work fully completed, not progress claims. 

Why Key Factors debt factoring? 

Experience: With over 30 years of experience, we’ve become Australia’s leading factoring finance company and have ample happy customers to back it up.

Transparent fees: We are up-front about our fees and only charge a simple daily rate based on how much you use. We don’t charge any monthly or annual fees and don’t require property security or quarterly audits. 

Flexibility:  At Key Factors, there are no long-term contracts or minimum monthly factoring requirements. You decide which invoices you want to factor based on your cash flow needs.

Fast approval: When you apply to work with us, you’ll receive a response within 24 to 48 hours.

Our mission is to support our clients at every stage of their business, and we do it with flexibility, top-notch customer service, and a genuine desire to see small Australian businesses succeed.

Take a closer look at your relationship with your traditional bank. Is it serving you and your company, or is it time to consider alternatives like debt factoring?  Whether your business is just getting started or is ready to take the next growth step, contact us – call us on 1300 884 100, email us, or complete our contact form and a friendly local cash flow expert will be in touch shortly.

We are specialized in debt factoring and have offices in Perth, Sydney, Melbourne, and Brisbane, and we work with clients all over the country. No matter what type of business you are in or where you’re located, we can help you create the cash flow you need for your business to thrive.

 

 

 

 

 

 

With numerous businesses successfully growing thanks to the help of Invoice Discounting, could it be time for your company to convert? There are many benefits that come with this flexible finance solution, from being able to better manage your cash flow, to improving your working capital.

We’ve taken a look at the facts and figures from the Debtor & Invoice Finance Association September Quarter and have put together a summary to show you how many businesses are moving towards Invoice Discounting and the turnover figures.

Consistently on the rise

Invoice Finance CompaniesThe total debtor financing turnover in the September 2015 quarter was $15.8 billion – an increase of 1.8% on the September 2014 quarter.

Invoice discounting turnover was $14.5 billion and factoring turnover was $1.3 billion. Total turnover for the 12 months to the end of September 2015 was $64.2 billion – an increase of 3.4% over the 12 months to the end of September 2014.

What are the stats in your state?

We’ve taken a look at how the statistics of turnover differ from state to state – at current NSW & ACT have the highest factoring and discounting turnover, at 38% in the September quarter. Victoria closely follows with 27% and Queensland at 17%. Western Australia also had an 11% turnover.

Is your industry already making the most of Invoice Discounting?

The Wholesale Trade industry had the highest percentage of receivables in debtor and invoice finance, with 38% for the September Quarter, followed by Manufacturing at 20%. Property & Business Services and Labour Hire also have a high percentage of receivables.
The statistics for Wholesale Trade are very similar for the percentage of discounting turnover, as to the percentage of receivables, again followed by Manufacturing at 19%, then Labour Hire and Property & Business Services at 10%.
When it came to the percentage of Factoring Turnover, Labour Hire has taken the lead at 27%, next to Wholesale Trade at 23%. Transport & Storage and Manufacturing also ranked highly in Factoring Turnover.

Facts about Key Factors

Key Factors offers a number of tailored cash flow solutions to suit each individual business. We can bridge the gap of slow payments, help you get on top of ATO obligations, and help your business reach its potential. Plus, with Key Factors, there are no long-term contracts, no minimum volume and no annual charges.

Read the report in full

To read the full DIFA Industry Data document for the September 2015 quarter, visit the DIFA website.

Still have a few questions?

The team at Key Factors will be happy to help explain anything further, or discuss how your company can get started. Simply give us a call on 1300 884 100, or fill out a short enquiry form today.

Many industries are turning to Invoice Discounting to build their business – we’ve summarised the Debtor & Invoice Finance Association (DIFA) Industry Data, June 2015 Quarter, so you’ve got everything you need in a quick and easy-to-understand format!

On the up

Recent findings from the DIFA show that the June 2015 quarter was $15.8 billion – an increase of 6.4% on the June 2014 quarter.

Invoice DiscountingAccording to State

NSW & ACT were the states with the highest factoring and discounting turnover in the June 2015 quarter, at 35%, with Victoria at 31%, then Queensland at 17%, closely followed by WA at 12%.

Could your industry benefit?

During the June 2015 quarter, the Wholesale Trade industry had the highest percentage of discounting turnover, at 36%. Manufacturing and Labour Hire companies also made up a large percentage.

The Transport & Storage industry formed 12% of the June Quarter 2015 factoring turnover, as well as the Manufacturing Industry. Labour Hire companies led with 27%, followed by Wholesale Trade companies 24%.

What Key Factors have to offer

At Key Factors we help SMEs from a wide range of industries improve their cash flow with flexible disclosed invoice discounting. With offices all over Australia, our local state managers are able to provide a tailored cash flow solution to suit your business.

Key Factors key benefits

Keeping simple, flexible alternative

  • No lock-in or long-term contracts
  • No minimum volume
  • No ongoing monthly charges or annual charges
  • No quarterly audits

All the facts and figures

To read the full DIFA Industry Data document for June 2015 visit the DIFA website.

Speak to a member of our team

Want to learn more about how Key Factors could help your business? Call us now on 1300 884 100, or enquire online today.

Invoice DiscountingThe latest statistics for invoice discounting and factoring  in the March 2015 quarter released by the Debtor & Invoice Finance Association (DIFA) was $15.3 billion, an increase of 1.9% in comparison to the March 2014 quarter.

NSW & ACT, followed by VIC and QLD were states with the highest invoice discounting turnover in the March 2015 quarter.

Industries with the highest percentage of invoice discounting turnover includes Wholesale trade at 37%, Manufacturing at 18% and Labour Hire at 10%.

At Key Factors we offer flexible disclosed invoice discounting, which requires no lock-in or long-term contracts, no minimum volume or usage, and no quarterly audits.

How does our disclosed invoice discounting facility works?

1) Simply invoice your clients and send us a copy.

2) Up to 80% on the invoice face value is made available in as quick as 24 hours.

3) The remainder 20% is provided when your customer pays us.

Key Benefits

  • Cover the gap of late payments
  • Provide your business with a more constant cash flow
  • Additional working capital can allow you to take on more jobs and grow

Contact us at Key Factors, on 1300 884 100 and a local state manager will be more than happy to discuss your needs and provide you with a quote to suit your requirements today.