Businesses often need more cash than they have on hand. It may be for an emergency, a fleeting opportunity or sometimes, just meeting payroll. That’s where factoring can help.
The Allied factoring process is simple. A business sells its invoices or accounts receivable to Allied. We advance most of the amount invoiced – typically 80% to 90% – to the business, then we collect their payments for them. Once the bill is paid in full, Allied remits the balance to the client, minus a transaction, or factoring fee.
Even though factoring is more common in the business world today, factoring can be more expensive than traditional bank financing. Companies that can get bank financing are naturally not a good fit for factoring services.
However, for companies that cannot obtain bank financing, factoring can provide the cash needed to fuel the enterprise.
Allied’s factoring services are designed to be a temporary fix, not a long-term solution. It is our goal to position our clients to improve their businesses to the point where they will qualify for traditional bank financing.
The Growth of Factoring
With the exception of 2001, factoring has enjoyed a thirty year pattern of year-over-year growth. Total factoring volume grew to $135.3 billion in 2007.
Factoring Fact
Allied Clients May…
• Have negative net worth • Have operational losses or inconsistent earnings • Be start-ups or early stage/high growth businesses • Have seasonal needs • Maintain high accounts receivable concentrations • Be highly leveraged • Experience tax problems or liens • Be in, or going into bankruptcy
