What Tour de France And Small Business Have In Common

Posted in: B2B Financing, B2B Invoice Factoring, B2B Invoice Financing, B2B Invoice Financing News, Invoice Factoring, Invoice Financing- Jul 11, 2014 Comments Off

With 21 stages ridden over 23 days—some almost 150 miles long—navigating cobblestones, assaulting at least two mountain ranges and dealing with thousands of over-enthusiastic crowds, the Tour de France bicycle race is arguably the most grueling of all sporting competitions.

Here are four reasons why competing in the Tour is like running a small business.

1.  structure
Tour participants are part of 22 sponsored teams of about 25 members, and each have individual roles to play. Some members are supportive non-riders and some are riders whose primary role is to protect and push their leader. But all work together to meet team performance goals, including getting their leader on the podium at the end of the day or the end of the race. Sounds a lot like a small business, doesn’t it?

Since every day in a small business can be like a mountain stage on the Tour—peaks and valleys—success requires the ability to motivate your team to work together effectively. A smart leader knows that sustaining successful teamwork requires sharing the recognition so the team doesn’t mind if you’re the one on the podium.

2. Communication
Competing in the Tour is like running 21 marathons in 23 days while simultaneously playing a chess match. So each team member has to understand his role in the overall strategy.

Even if you have the best business strategy in the world it must be communicated to your small business team so every member understands their role in the organization’s plan to achieve success.

3.  Preparation
All you have to do is watch a Tour de France cyclist in a mountain stage to see successful preparation. These guys have turned their bodies into human spring steel as they become one with their bikes.

4.  Technology
Tour de France teams certainly leverage technology, including high-tech bikes, customized chase vehicles, on-course communication tools, etc.

One of the keys to success for small businesses in the 21st century is leveraging technology.  If you want to stand in the winner’s circle you MUST find ways to use technology to make existing systems more efficient as well as help you take advantage of new opportunities.

Write this on a rock … Small businesses can learn a lot from the Tour de France teams.



B2B Invoice Factoring Frequently Asked Questions

Posted in: B2B Financing- Sep 04, 2013 Comments Off


B2B Invoice Factoring Frequently Asked Questions

What is factoring?

Factoring accounts receivable is the practice of selling your business-to-business (B2B) invoices, at a discount, to a Factoring Company (also known as a factor) to free up working capital while waiting for payment. The factoring company provides you with an immediate cash advance and receives payment from your customers for the invoices.

What is the financial impact of factoring?

The financial impact is very similar to you giving a customer a discount for early payment. Factoring is a form of asset-based financing that does not create debt. It is NOT a loan.

How does factoring work?

Factoring companies buy your invoices and pay you for them in two installments. The process is simple and has three steps:

  1. You invoice your client after delivery of your product or services and send a copy of the invoice to the factor
  2. The factor advances a predetermined percentage of the invoice amount as a first installment
  3. When your customer pays, the factor will remit the remaining balance of the invoice amount to you, less a nominal factoring fee

Who qualifies for invoice factoring?

Invoice factoring can be used by most companies that engage in commercial or government sales. The three most important requirements are:

  1. Your company must sell to other businesses or to government entities
  2. Your customers must be credit worthy
  3. Your invoices must be free of liens

Why would you want to do this?

Factoring helps you speed up cash flow. The cash you get from a factor is unrestricted. You can use the money to pay bills, cover payroll, etc. If you’re a start-up or turnaround company, factoring is a practical way of getting the working capital you need. Factoring provides funds without the usual red tape, financial statements, credit history and personal guarantees that banks normally require.

How long will the application process take?

The application process can vary from company to company but generally factoring has one of the fastest turnarounds. Most factoring companies will move as fast as you can provide the documentation requested.

What if I have an outstanding loan?

A factoring company’s main concern is making sure that there are no liens on your accounts receivable. If you have already pledged your receivables as collateral for other loans, you should disclose this to the factor early in your dialogue. If your receivables are already pledged as collateral, the factor may still be able to help you but you need to disclose this early and not wait until the factor discovers the liens during due diligence.

What will my customers think, and how will they be treated?

Relax. Factoring is a huge industry. Small to large companies factor and your customers are probably already working with factoring companies through other firms they do business with. Remember that it’s in the best interest of a professional factoring company to keep your customers happy. The happier your customers are, the more invoices you will want to factor. We can help you find an established, professional factoring company with a good track record.

Do I have to factor all of my invoices?

No. Most companies pick and choose the customer whose invoices they want to factor. We always advise you to ask your factor about this before signing an agreement. However, the factors we recommend do not obligate you to factor all your invoices.

What kinds of companies’ factor?

Companies in every sector of our economy with business-to-business (B2B) invoices can be eligible to factor their invoices. If you’re strictly a retailer, factoring is not for you.

What do factors take as collateral?

Factoring companies will require a first line position on the invoices you factor. So, the invoices must be lien free.

Are there any other benefits to factoring?

In addition to freeing up capital, you also get back office support that will free up your time so you can focus on growing your business. For example, factors will check the credit of your prospective customers to help you make the best decisions pertaining to credit terms.


For More Information Please Call Us at (800)458-6056 Sales Call (800)316-4212 Main Office


Why Do Banks Decline B2B Financing Clients

Posted in: B2B Financing, B2B Invoice Factoring, B2B Invoice Financing, B2B Invoice Financing News- Sep 04, 2013 Comments Off

Why Do Banks Decline B2B Financing Clients?

We often get calls from companies that need business financing and have been turned down by traditional financial institutions. Many of these prospects consider their experience of trying to get bank financing/loans to be a sour experience. Traditional banks don’t really understand your business and how fast it can grow.

Start by looking at the typical b2b financing client. Many clients companies have a short amount of time in operations, but some may have more. Some of them have no hard assets for example: Real Estate or Equipment for the company or for the business owner. Also a number of them are in a rebuilding process; basically they are turning around a troubled business.

How do Traditional Banks Lend? Banks lend against assets you own, exceptional performance or a combination of both. To meet their standards you must have assets, good credit history or both. They want to see businesses and their owners have rock-solid balance sheets with assets that can be used as a guarantee. No real assets means no real collateral. Sometimes they can make somewhat of an exception to the asset rule, but in reality they want to see unrivaled performance showing a long excellent track record of success. And they will usually lend on a combination of these qualifications.

Now, if you look at the typical b2b financing client described above you will see that the majority of the time they will not meet the standards to get traditional bank loans/funds – even if you try really hard. With B2B businesses it’s better to go with a Specialty Financing Company like Transfac Capital’s B2B Financing Company, where we know your business and how you conduct business, so we can help you succeed and are here with you well you grow and expand your company.