Invoice Factoring for Machine Shops
Machine shops cut, fabricate, and finish instruments, tools, and parts used in every industry. A lot of pressure is often placed on the shops to complete an order on short notice, and this might require staff to work overtime, which becomes problematic when the monthly budget is insufficient.
Are you struggling to meet your short-term funding needs? Do you have established clients, but your cash flow is affected because they pay 30, 60, or even 90 days after receiving your invoice? Factoring is a reputable business funding alternative. Sell your accounts receivable to an invoice factoring company, and they will provide you with an instant advance on the invoice balance.
Factoring companies pay a large percentage of your invoice upfront, and it is debt-free because you are simply getting an advance on money already owed to you for work you’ve completed. The factor will handle collections, and your clients will settle their outstanding balances with the factoring company.
Machine Shop Factoring vs. Bank Loans
Bank loans are approved based on your machine shop’s operational and credit history. If the loan is approved, your company incurs debt that must be repaid with interest over a specific period. Factoring provides funding based on the credit strength of your clients. You incur no debt and pay no interest.
Top Challenges in the Machine Shop Industry
How to Run a Successful Machine Shop
Know how to use your machines, look after your tools by keeping them clean, and they will work for a long time. Be willing to work weekends or evenings for difficult parts orders bigger establishments cannot respond to immediately. When you are ready to expand, a factoring company can provide funding as soon as an agreement is reached.
Financing Options for Machine Shops
Considering invoice factoring for your machine shop? Request a machine shop factoring quote today.