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Financing the Cable Industry through Factoring

Mar 6
08:08

2012

Lanette Tucker

Lanette Tucker
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Cable installation, door to door cable sales, drop bury, disconnects, and boring contractors have unique needs and challenges to keep their working ca...

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Cable installation,Financing the Cable Industry through Factoring Articles door to door cable sales, drop bury, disconnects, and boring contractors have unique needs and challenges to keep their working capital flowing.  As an owner of a cable company you know that your payroll can come relentlessly.  It is easy to have 500,000 to  1,000,000 dollars in accounts receivables, but every week you need to make that payroll.   Finding a factoring company that understands the cable and telecommuncation industries can be your perfect solution.

A factoring company can fund your payroll quickly and easily in as a little as a few days.  Traditional funding can take months for approval.  Waiting 30-60+ days for payment of an invoice ties up your working capital. Cable installation and sales companies don’t have the luxury of waiting around until they get approved for a bank loan or waiting for payment from a big company.  

Make sure to hire a factor company that understands concentration issues considering most cable installers and sales companies usually only have a few large customers.  Ask if there is one person assigned to your account.  This alone will greatly enhance their ability to build a rapport between you and your clients.  

The factor advances you up to 90% of the invoice amount immediately, and gives the remaining balance when your clients settle in full. Here’s how invoice factoring for cable installation companies works in three simple, easy steps:
  1. Your cable installation company provides goods or services to creditworthy customers and then invoices them with a copy sent to the factor.
  2. The factor will fund your business with an immediate payment of 70%-90% of the received amount.
  3. Customers make payment directly to the factoring company according to the terms of the invoice, and the factor returns the balance of the paid invoice to you minus a fee.


Factoring increases cash flow.  Get money as soon as you finish the work. A factor should not ask for equity in your company, nor are you taking on additional debt. A factor provides the capital you need and to keep your business growing.

A factor can act as your in-house credit department at no cost to you. Before doing business with a new customer, let the factor give you a comprehensive payment and credit history so you can avoid problem clients.

A factor provides flexibility by letting you factor the invoices you want, when you want, with no long term contracts. A good factoring company lets you factor as much or as little of an account as you wish. You factor only what is advantageous to you.

The ultimate goal of invoice factoring is to increase your available funds. This will enable you to go after bigger clients and larger contracts. Often, you will find that it takes the big guys longer to pay. This can lead to difficulties in filling larger orders and performing larger jobs.

Article "tagged" as:

factoring company

invoice factoring

sales companies

cable installation

Categories:

Finance

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