No matter the industry, businesses need cash on hand to operate. Cash is the fuel that powers business operations. Invoice factoring for renewable energy contractors is a financing option used by many energy industry service providers to keep their company running at full potential.
Invoice factoring is a type of financing used by many companies to improve cash flow and get faster access to their accounts receivables. Companies in a wide variety of industries use invoice factoring when traditional financing is not an option.
Here’s how invoice factoring works. Companies using invoice factoring provide their work or services as usual. When the work is complete, the invoice is sent to a factoring company. The factoring company advances a significant percentage of the invoice value to the factoring client the same day.
The invoice is then sent to the customer, to be processed and paid in standard terms, to the factoring company. Once the factoring company receives payment, the remaining invoice balance, less a small fee is then paid to the factoring client.
There are numerous benefits of using invoice factoring for renewable energy contractors. First and foremost is the immediate availability of cash. Instead of waiting 30 days, 60 days, or longer for customer payments, renewable energy contractors use factoring to have money for payroll, managing company expenses, and to go after new business.
There are benefits of invoice factoring besides the cash flow. Companies that do not qualify for traditional financing turn to invoice factoring because qualifying for and setting up a factoring account is much faster. With invoice factoring, it is the credit history and payment abilities of the factoring client’s customers that are the determining criteria, not the factoring client’s. Factoring is an ideal option for startup companies and those working to build a positive financial history.
Invoice factoring can save time and resources for renewable energy contractors. Business owners are pulled in many directions. With the cash from factoring, they are not spending time the phone trying to chase down payments, or scrambling to come up with money to work. Invoice factoring enables owners and operators to focus on what they do best, provide quality work to their customers.
Getting started with invoice factoring for renewable energy contractors is simple. Scale Funding has over 20 years experience providing invoice factoring services to renewable energy contractors throughout the United States. For a free, no-obligation factoring quote and proposal, complete the form below, or call (800) 707-4845.