Commercial financing for small to mid-sized businesses requires innovation. Business owners need to be pragmatic in regards to growing their businesses. But, additionally they need money when opportunity comes knocking. One of the ways they’re taking control of the business growth is by using 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 tiny 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 a couple of weeks on average.
2. Download auction application – Once approved for receivables trading, the newest seller can download the application form to their computer. This Business Loans Dorset desktop application provides usage of the live, online receivables auction platform where buyers and sellers have 24/7 usage of auctions and transactions.
3. Choose invoices – Now, the seller is ready to choose the accounts receivable they would like to post for auction. As long as long as the 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 snapped up quickly and receive the most effective 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’ll accept from bidders, the most discount fee they’ll pay and the length of time the auction will last. Owner can decide to run it from 3-10 days.
5. Sale transaction occurs – You can find two ways this may occur. When the auction closes, the Buyer with the best bid that meets 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. When 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 experiences, 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 less than 1 day, small to mid-sized business owners give themselves an edge on the competition. They’ve the methods to grow their business now rather than awaiting invoice payments in the future in. Commercial financing employing their accounts receivable allows them to tap into funds that normally take 30-90 days in the future in.
Typically, about 60% of your small business’working capital is sitting dormant in the form of invoices. Put these assets to work by getting this money now rather than later. Through invoice financing, small to mid-sized business owners can control the fate of the ventures with little risk, few restrictions and total control. Opportunities won’t wait.