Commercial financing for small to mid-sized businesses requires innovation. Business owners need to be pragmatic in regards to growing their businesses. But, in addition they need money when opportunity comes knocking. One way they’re taking control of these business growth is with a commercial financing process that allows them to auction off their accounts receivable.
Here’s how it works:
1. Apply online – The receivables auction marketplace offers a software for membership online. The small to mid-sized company owner can fill this out in about 15 minutes. Once the application form and necessary financial documents are received, approval for membership takes about two weeks on average.
2. Download auction application – Once approved for receivables trading, the brand new seller can download the application form to their computer. This Business Loans Dorset desktop application provides access to the live, online receivables auction platform where buyers and sellers have 24/7 access to auctions and transactions.
3. Choose invoices – Now, the seller is ready to choose the accounts receivable they wish to post for auction. As long as long as the sum total auction amount exceeds $10,000, the seller can post any commercial invoices they want.
Tip: The simplest way to obtain cash quickly and efficiently is to post invoices of well-known, investment-grade account debtors with great credit histories. These tend to obtain purchased quickly and receive the very best rates of capital.
4. Set parameters and post – Owner maintains control by setting the parameters of the auction. Owner decides the minimum advance amount they will accept from bidders, the most discount fee they will pay and how long the auction will last. Owner can decide to run it from 3-10 days.
5. Sale transaction occurs – There are two ways this could occur. When the auction closes, the Buyer with the highest bid that fits the parameters set by the seller wins the auction. Another option is that the seller can set a “Buyout Price “.This resembles the “buy it now” option on eBay. Each time a Buyer agrees to the “Buyout Price” the auction is immediately closed and awarded compared to that Buyer.
6. Get commercial financing fast – When the sale undergoes, the funds are electronically deposited into an account for the seller. This happens within 24 hours of the auction close.
With cash in hand, possibly in as little as one day, small to mid-sized business owners give themselves an advantage on the competition. They’ve the means to grow their business now as opposed to waiting for invoice payments ahead in. Commercial financing utilizing their accounts receivable allows them to tap into funds that normally take 30-90 days ahead in.
Typically, about 60% of a small company’working capital is sitting dormant in the proper execution of invoices. Put these assets to work by getting this money now as opposed to later. Through invoice financing, small to mid-sized business owners can control the fate of these ventures with little risk, few restrictions and total control. Opportunities won’t wait.