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When a business sells its accounts receivable – or invoices – to a third-party (a ‘factor’) it’s called ‘factoring’. The transaction results in immediate access to cash for the business from the factor, who then collects the payments owed to the business from their customers.

Factoring is an option that increases cash flow for businesses of all sizes and from all kinds of industries. Factoring is used to purchase inventory, new equipment, pay employees, get on top of ATO obligations, or expand organisational operations. It has many benefits for businesses that are looking to grow and make faster decisions when it comes to their expansion.

Advantages of factoring finance

Apart from providing quick access to cash that a business would otherwise have wait for up to 90 days for, factoring can make a significant difference to operational efficiency and customer relationships in the long term. Moreover, factors provide free management of accounts collections from a company’s customers – a task that can be stressful and time-consuming. As a result, more time can be spent on making more efficient use of resources and growing business.

Factoring Finance PerthFactoring can also be a quick solution to raise vital working capital for growing companies going through expansion.

Why you should trust Key Factors for factoring finance

At Key Factors, we use over 30 years of experience in the field to make sure your business is in good hands. We are an independently owned Australian company, with a well-built reputation when it comes to providing our customers with flexible factoring solutions.

Most importantly, we’re reliable. Our aim is to make sure that slow payments don’t limit your business’s potential. For that reason, you can count on us to give you up to 80% of the value of your invoices in as quick as 24 hours.

Key Factors has offices in Sydney, Melbourne and Perth. Whether you’re looking into factoring to improve cash flow or take full advantage of your business’ growth potential, our friendly staff are here to answer all your questions. Call us on 1300 884 100 and speak to cash flow expert today.

If you think getting funds within 24 hours of factoring your invoices is fast, think again.  Key Factors is looking to introduce real-time payments to allow instant funds transfers.

As part of the New Payments Platform (NPP), instant or ‘real-time’ payments between some Australian bank accounts will be possible 24/7.

Why does transferring funds between different Banks take so long?

Currently, when we transfer factoring funds into your nominated account, it generally hits your account the next business day. That’s because different Banks transfer funds at different times of the day and only during business hours.

How will Real-Time Payments under (NPP) work?

At present, when we transfer factoring proceeds to a customer with the same bank, funds are received almost instantly.

Under the New Payments Platform (NPP), the same can apply even if our customers do not bank with the same bank. That’s because NPP acts like a secured network between participating financial institutions, allowing funds to be transferred between accounts immediately.

Which Banks have signed up?

The big four banks have all signed up along with 9 other financial institutions listed below:

  • ANZ
  • Commonwealth Bank of Australia
  • NAB
  • Westpac
  • RBA
  • ASL
  • Bendigo/Adelaide Bank
  • Citigroup
  • Cuscal
  • HSBC
  • Indue
  • ING Direct
  • Macquarie Bank

What are the advantages of Real-Time Payments and when will it take effect?

The ability to instantly receive funds will ensure your business can meet any unexpected expenses or opportunities that may arise from time to time.

Getting instant cash in your bank account can be as easy as 1 2 3:

  1. Invoice your clients for sale of goods or services and send Key Factors a copy
  2. Key Factors will credit your account with up to 80% of the invoice value.
  3. The remaining 20% is provided once your client pays us, less any accrued fees.

The New Payments Platform (NPP) is set to launch early next year and all participating banks are going through the final stages of testing.  Key Factors will have our finger on the pulse so our customers can reap the benefits of Real-Time payments.

Key Factors Perth

 

How can you qualify?

Businesses benefiting from Key Factors flexible cash flow finance generally have a high level of customers on accounts for the provision of goods or services and have an annual sales turnover ranging from $500,000 to $30 Million.

At Key Factors, we understand small business loans Australia! As a leading cash flow finance company with over 30 years of experience your business is in good hands.

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

Company Name: Flexi Management Solutions Ltd

Industry: Workforce Management

Annual Turnover: $10,000,000.00

Group Facility Limit: $1,000,000.00

Flexi Management Solutions Ltd founded in 1972 is an Australian company listed on the Australian Stock Exchange. Flexi Management Solutions provide workforce management solutions to leading public and private sector organisations. WhenFlexi Management Solutions approached Key Factors they had multiple subsidiaries that were operating at a loss, they had just ceased their factoring facility with another provider, and they were on the verge of being shut down by the ATO due to having tax debts in arrears in excess of $2,000,000.00.  Key Factors’ flexible factoring was just what they needed to get their business back on track.

They needed cash flow assistance in order to sell off some of their non-performing subsidiaries and clear their ATO debts, at the same time they were cautious due to the poor experience they’ve had with their previous provider. They wanted a flexible financial partner who was not going to tie them into a long-term contract, allow them to use the service on a selective basis, and only charge them for what they use. Key Factors was able to offer Flexi Management Solutions just that and at the same time improved their cash flow by releasing the cash tied up in their unpaid invoices.

Key Factors Flexible Factoring

Flexi Management Solutions simply submit invoices to Key Factors as they need cash, and up to 80% on the face value of their invoices were credited into their account in as quick as 24 hours.

Within 6 months of using Key Factors flexible factoring finance, Flexi Management Solutions cleared all their ATO debts, restructured their business and is back to being a front runner in the workforce management sector.

Key Factors flexible factoring has no long-term contracts, no property security, no minimum usage, no management fees, no annual fees, no monthly admin fees and no quarterly audits.

The scenario above is taken from a real client situation. The client’s business name and details are withheld for privacy reasons.

With over 30 years of experience and offices in Sydney, Melbourne, and Perth, your business is in safe hands.

Call 1300 884 100 today to find out more.

Invoice Factoring Perth55.8 days is the average payment terms for Australian Businesses, according to the most recent survey by Dun & Bradstreet June 2013. So what can businesses do to ensure they get invoices paid quicker and maintain a healthy cash flow?

Secure cash flow financing

Key Factors flexible cash flow financing allows businesses to release the cash tied up in their unpaid invoices in as quick as 24 hours, without the need of real estate security or long-term contracts. Instead of waiting 30, 60 or even 90 days to get paid businesses can get up to 80% on the value of their invoices credited to their account, when they need it.

Invoice promptly and correctly

The sooner the invoice is issued and is received by your customers the sooner you will get paid. Ensuring all information on the invoice is correct can also get your invoices processed more promptly with minimal delays. Electronic invoicing is quick and easy to track and is a viable option for businesses wanting to reduce processing & delivery time of invoices.

Know your customers

When a company has clients on accounts they are essentially providing credit, hence it is important to know the credit worthiness of their customers. At Key Factors we conduct essential background checks & analyst on our clients debtors to limit their risk.

Follow up on payments

Late payments causes strain on a business’s cash flow. So when your customers pay outside your terms, it is always best to follow up. Simple but effective follow up methods includes, a telephone call, and posting out statements to clients outlining amounts owing and the date it was due. Key Factors conducts follow up on payments on behalf of our clients, allowing them to focus on what they do best and grow their business.

Don’t let slow payments hold your business back

Late payments have a major impact on the business’s ability to meet operational expenses and hinder investments for growth. Hiring new staff to meet demands is also not an option when cash flow is limited.

Find out more about our cash flow financing today by calling 1300 884 100 today.

We understand that every business is different, big or small, public or private, local or national, and we’ve helped all kinds reach their goals with flexible finance solutions. Some were looking for a permanent fixture to help with day-to-day business, others simply needed an extra hand while they went through a growth spurt, while many use us as and when they need us, at no extra charge. At Key Factors, we have numerous options to suit your business, whatever your setup and whatever you want to achieve.

We’re ready when you need us

Key Factors Pty LtdWe know that business growth opportunities or cash-flow problems can arise unexpectedly and businesses often don’t have much time for delayed reactions to these deadlines. There isn’t usually spare time for your stakeholders or many of the numerous company representatives to get involved in the decision process. This also applies to sitting around waiting for application approvals, thus our flexible options. Key Factors can sit in the background, ready for when we are needed, with no long-term contracts, no minimum volume and no ongoing monthly charges. Fast access to cash flow can make a huge difference to the success of your business, and it no longer needs to be complicated.

Try pay-as-you-go

Bank loans are often set to strict repayment plans, with very little flexibility and are not easy to initially achieve, they are also often secured by your corporate and even personal assets. This results in stakeholders and business partners being a little apprehensive with commitment and understandably thorough when it comes to risk assessment and figures. With factoring, you are only accessing money tied up in your accounts receivables, therefore the amount will solely depend on sales. If you would rather have no interest to pay or principal to repay, a pay-as-you-go option could be your solution.

Restrict your restrictions

Don’t be restricted by caps and limits, with factoring, your ability to grow is in your hands, not the hands of your bankers. Factoring is practically an unlimited source – with your cash availability representative of your sales volume.

Flexible finance

Key Factors is a flexible service that can be used for any amount of time on any percentage of your entire business. Plus, factoring can even be used alongside any pre-existing bank loans. This is extremely beneficial when you have numerous members of the company involved in your finances, as there is no long-term loans or detailed bank contracts everyone needs to agree on, just a simple solution with a percentage fee agreed upon in advance.

If you already have a set bank loan that you will be using, or if your loan amount is exhausted, don’t be put off – there is no reason you can’t still make the most of factoring cohesively. They can both work in conjunction with each other, neither causing restrictions. Factoring can give you the availability to grow and pursue new business opportunities.

Working with Key Factors

Keyfactors PerthOne such company that dealt with their cash flow restrictions, while still keeping all their stakeholders content came to us in April 2016. Discover how we helped improve their business and gave them the ability to grow using alternative finance.

Introducing *ABC Drill Pty Ltd – now an American owned business that has been operating in WA and Australia since the early 1960s.

The company background

ABC Drill Pty Ltd was originally set up as a local family business specialising in servicing, building and maintaining drilling rigs for the mining industry. With the massive mining expansion in WA after 2001 they grew considerably and were then taken over by an American based conglomerate late 2011.

ABC Drill Pty Ltd now builds maintains and services specialised drilling equipment to supply the Australian market, and are also looking at expanding and selling some of their rigs and technology to overseas clients of the US parent.

Joining forces

ABC Drill Pty Ltd now has the backing and strength of the US based parent, and their growth to date has been fully funded by the US company. They have no bank lending of any kind and own the majority of their plant and equipment, buildings and real estate. The parent company has of late, pushed for them to become more ‘cash flow’ self sufficient, hence their request for help from Key Factors.

This was a great opportunity for Key Factors to highlight their flexibility and give the company an opportunity to grow, using their cash tied up in their accounts receivables as and when needed.

Finding a cash flow solution

The major banks have all let ABC Drill Pty Ltd business pass, as they all wanted water tight security and guarantees from the US based parent and shareholders for any lending the WA company wanted.

Key Factors were able to structure a facility and security arrangements that suited both the local CFO and US based directors and shareholders. At Key Factors we have the flexibility to work around your business barriers.

A future with Key Factors

Key Factors hopes to be a long term partner for ABC Drill Pty Ltd, and expand their network of high worth and blue chip clients/debtors.

One of the major selling points that the US parent liked, was the ‘pay as you use’ nature of our facility. This is something we offer to all our clients, and can be the ideal compromise. Key Factors sits well as a ‘back stop’ arrangement, which can sit in the background (costing nothing) and be pulled out and used if and when required.

Find out if factoring could work well for your business by getting in touch with our expert team. We are available if and when you need our services and only charging a percentage of what you use.

ABC Drill Pty Ltd – facts and figures in further detail:

The American company has worldwide offices, employs over 3,500 staff worldwide, and has an annual turnover in the $ Billions of dollars. It specialises in the oil and gas industries around the globe.

Proposed limit

$750,000

ABC Drill Pty Ltd current directors

The majority of directors are US based, plus one Australian director.

The company is managed in Australia by the CFO

Shareholding

100% ownership held by “ XYZ US Inc” of the US

General company information

The Perth based company turns over in excess of $50 million in annual sales.

The facility for $750,000 was approved and documented here in our Perth office in April 2016.

In summary:

Whatever size your business and however many stakeholders you need to please, with Key Factors, you have the flexibility and options to choose from, depending on your requirements. With no lock-in or long-term contracts, no minimum volume and no annual charges, why not get in touch to discuss how we could solve your factoring problems?

Working with Key Factors could help your business grow and please your company stakeholders, with fast approval and no hidden fees – find us in Perth, Sydney and Melbourne.

With over 30 years of experience and offices in Sydney, Melbourne, and Perth, your business is in safe hands.

Call 1300 884 100 today to find out more.

*Disclaimer: The client’s real business name and details are withheld for privacy reasons.

If you are looking for a flexible factoring business in Australia, you might have come to the right place.

Although small business makes up a vital part of the economy, even the most successful Small and Medium Enterprises can struggle to be approved for the loans and get the funding they require to thrive and succeed.

Flexible factoring business

Factoring For Small BusinessWhether you’re an experienced lender or it’s your first time looking into financial help, factoring could be the answer for your business. Half of the battle for a growing business is their ability to keep up with demands without consistent cash flow. Factoring provides exactly that, it allows you to release cash tied up in unpaid invoices. Therefore, you are only accessing money that is owed to you. There is also a high level of flexibility when it comes to factoring. Key Factors as a factoring business doesn’t require a minimum volume, there are no lock-in or long-term contracts and no ongoing monthly or annual charges.

Are you avoiding the lending process?

Is there something putting you off the lending process? If you’re worried about risk-based interest that could take a turn at any time or you’re nervous about linking your property to your business, it’s time to take a look at a factoring business like Key Factors. There are no surprises and no hidden fees, plus you can use us as much or as little as you like! Find out more about how we work here.

We’re focused on what’s best for your business – take a look at this recent case study:

No matter what your current situation is as a business. We work with you to provide the best solution.

*ABC Pty Ltd is a family owned business with over 80 years of experience in the manufacturing industry. Their ability to service a wide range of clients with an array of products has allowed them to maintain a comprehensive customer base for three generations. As the new generation re-shapes the company’s focus, their ability to satisfy a continual stream of work is inhibited by lengthy trading terms which has restricted their increasing customer base.

With an existing over draft from one of the big four banks already accounting for a portion of their lending portfolio. They were looking for an alternative source of funds without having to increase their exposure to the bank, which required additional security over the director’s homes. Key Factors was able to assist in conjunction with the bank and enable the organic growth of their business to continue.

With no lock in contracts or minimum spends, ABC Pty Ltd had the freedom to use Key Factors as the need for additional capital increased. Key Factors has made available new opportunities for growth that didn’t exist under conventional lending agreements. While maintaining a close relationship with Key Factors they were able to satisfy their existing obligations with the bank and more importantly excel in providing the best service to their customers.

Background

Industry: Manufacturing

Annual Turnover: $5,000,000.00

Facility Limit: $200,000.00

In Summary:

Whether you don’t have time to wait for a loan approval, your bank has offered you a loan but it is too low, or you simply have a low credit rating, we have an option to suit you. With fast approval and a strong customer focus, a factoring business like Key Factors’ could be the bank alternative you’re looking for.

At Key Factors we care about your business. Take a look at who we have helped in the past with more case studies and find out if we’ve worked with businesses in your sector.

With over 30 years of experience and offices in Sydney, Melbourne, and Perth, your business is in safe hands.

Call 1300 884 100 today to find out more.

Banking a tradition

Australia has historically had a lending culture of never thinking beyond the big banks.

The first question asked by many business owners is: Who do I go to if I need finance for my growing business?

The answer most often being: My bank, or more specifically, one of the ‘Big Four’.

But that then leads to part two of the equation, which is one of, or a combination of the following barriers:

  1. They won’t lend to me (due to not having property or sufficient equity)
  2. They won’t give me enough money (the sum is too small to achieve my business goals)
  3. They don’t understand my business (they have not worked with my sector before)
  4. They make it too hard to do anything (the amount of paperwork and hoops to jump through can be near impossible.)

Factoring Key PerthWhilst it is easy to bash the banks, we must remember they have an important role to play, and every business; small, medium and large, will need to work with them in some capacity.

In Australia we are very fortunate that our major banks are very safe, profitable and global success stories.

So why do the big banks make it so difficult?

Many banks seem to make it very hard for the SME (small to medium enterprise) sector to access their facilities. At Key Factors, we think the reason is simply that they don’t need to. They are already large and successful, meaning they can be more selective in who their customers are, who they lend to, and as such don’t need to lend to low equity SMEs.

Bank alternatives to the rescue!

Alternatives to large banks are needed and many small businesses are now waking up to the fact that there may be more than one way to finance their growth. More and more small businesses are turning to non-bank/non-traditional lenders who offer something broader than an overdraft or term loan.

Compounding the problem

This is where we see a potential compounding of the problem. As these dynamic non-bank lenders grow, they, in many cases also need to fund their own growth, and so where do they turn? The banks, who provide funding lines at wholesale rates. Noting that for the bank it is easier to lend $100M to one customer than $1M to 100 customers, and these lending intermediaries are a good earn option for the majors.

However, for these non-bank lenders to remain complaint with their own lender, they by default and design increase their own compliance protocols and now we see these same four frustrations as detailed earlier appearing with customers of many non-bank lenders. Most specifically, three and four, which feeds two.

Key Factors – Free from influence

For over twenty-six years Key Factors has been helping Australian businesses, from a wide range of industries improve their cash flow and support growth. But unlike most, Key Factors remains privately owned and independent.

We are free from the outside influence of any other financial institutions that can cloud ones judgement. We make considered, objective and independent decisions that preserve and develop our client’s experience and relationship with Key Factors. And importantly we are consistent with our customers – which gives them confidence and comfort.

As a result the four ‘statements of frustration’ are removed. Let us explain how:

Case Study 1:

An all-Australian company with over 70 years combined experience in the building industry, designing and manufacturing of high-end products.

The Problem:

Directors are both homeowners and both have mortgages with their bank. All their bank was willing to provide the business with as a financing option was a corporate credit card facility limited at $50K. As explained to the client, for them [the Bank] it was an easier approval process than an overdraft but operating in the same way. With a business continuing to grow and an average receivables ledger in excess of $200K, the ability to fund this growth was clearly being constrained.

The Solution:

Keyfactors PerthKey Factors provided a flexible invoice finance facility with no long-term contracts, no minimum volume, no ongoing monthly charges, and no quarterly audits. By having a constant and more predictable cash flow, it allowed the company to pay out the credit card facility and pay suppliers on or ahead of time, thus giving them the ability to take up discount options for early payments and grow their business.

  • Industry: Design and Manufacturer of building products
  • Annual Turnover: $2,000,000
  • Facility Limit approved: $500,000

Case Study 2:

An Australian owned and operated company with distribution capabilities in all Australian States as well as New Zealand. This business offers innovative and advanced stormwater solutions backed by state-of-the-art research and technical support that comply with Australian and International standards.

The Problem:

The business currently has a debtor finance facility with a major lender, however compliance and ongoing reporting requirements are constantly dragging resources away from the day to day tasks of servicing customers and sales growth. The business owner feels that he is now working for the lender rather than running a business. He is looking for an alternative that provides the product benefits but without the time wasting.

The Solution:

Key Factors is looking to provide a flexible disclosed finance facility with no long-term contracts, no minimum volume, no ongoing monthly charges, no quarterly audits, no quarterly balance sheets and profit and loss reports, no monthly receivable ledger reconciliations and no quarterly budgets and cash flow forecasts.

  • Industry: Importer & Wholesaler of stormwater solutions
  • Annual Turnover: $6,000,000
  • Proposed Limit: $1M

Choosing a finance solution that matches your requirements

All business owners know that the life of their company goes though stages such as growth, stability and maturity – within these stages there are cycles of growth and contraction which can be internally and externally driven. As a business moves through these stages, business owners must ensure that they have financing in place that is able to match the business needs.

An overdraft, credit card and/or term loan do not move with you. They are fixed amounts that won’t account for your business growth and the need to put on more sales and staff, which can quickly be outgrown.

Are you a growing business?

For growing businesses, there can also be delays when dealing with these heavily compliance laden lenders. Approvals that can take months to be finalised with no guarantee the application in the end being approved. If they are approved then there is a need to take into account the ongoing compliance issues. This is going to be time better spent focusing on growing and ensuring the business is succeeding.

Don’t run the risk

We see the situation so often repeated, where long-term facilities secured by long-term assets [i.e., bricks and mortar] to fund the short-term issues of consistent cash flow and stock purchases. Short-term in the sense of these are liquid items moving through the business on a daily basis. It would make sense to accommodate these liquidity issues with the short-term asset and often ignored, your trade debtors.

What’s my alternative?

Options like debtor finance, on the other hand, follow your business cycles and as your business grows it grows with you.

To discover more about none traditional finance options, which could help your business grow, visit keyfactors.com.au

With over 30 years of experience and offices in Sydney, Melbourne, and Perth, your business is in safe hands.

Call 1300 884 100 today to find out more.