We Make Invoice Factoring A Simple Process
1st Commercial Credit offers receivable factoring services for all sorts of businesses serving many industries in Kentucky. If your business sells services or products to other companies, your business will likely be eligible for our accounts receivable financing program. 1st Commercial Credit is a specialized lending company offering financing solutions to startups and small businesses in Kentucky.
Our cash flow lending decisions are based on receivables, and we do not focus on low or bad credit. A business can obtain the fast cash needed by selling its accounts receivable to an experienced factoring company. We finance a variety of industries, including agriculture, healthcare, transportation, staffing, distribution, manufacturing, oil and gas, and more.
AR financing gives companies immediate payment for their unpaid invoices before customers make the payment, which can take several weeks to months. Factoring companies will advance you a large percentage of the outstanding invoice value and charge a small factoring fee for the service. This financial alternative can help resolve cash flow issues for businesses in Kentucky.
With more than 18 years in business, 1st Commercial Credit is the preferred invoice factoring company in the nation for growing companies. We provide invoice factoring services and funding for small, medium, and large companies every day.
Our customers enjoy incredible growth after they set up an accounts receivable factoring agreement with us. It allows them to offer credit terms to customers without running into cash flow shortages. We provide fast funding, flexible approvals even if the owner has bad credit, affordable invoice factoring interest rates, and other financial solutions that help grow companies.
Kentucky's industries are very diverse as it relies on small contributions from a more significant number of different industries. Still, there are a few industries that stand out as crucial sources of income for the state. Businesses in Kentucky no longer have to rely on banks for funding. Small businesses in a challenging cash flow situation can now turn to invoice factoring for a fast and simple financing alternative to improve their cash flow situation and secure money to grow. Even if your business doesn't qualify for other forms of traditional financing, like bank loans, invoice factoring is still an option because we accept bad credit and focus more on your customers' credit.
Factoring receivables is a financing alternative available to businesses that may not qualify or have an established relationship with a lender. Banks often base loan approval decisions on a business's assets and financial and credit history. On the contrary, invoice factoring is an accessible way for companies to obtain the funds currently tied to their accounts receivable.
The combination of Kentucky's ideal location, business-friendly environment, and skilled workforce make it the perfect place for manufacturing businesses to establish, make and ship their products to the rest of the world. The manufacturing sector is experiencing incredible growth in Kentucky. Manufacturers account for 18.56% of the total output in the state, employing 13.07% of the workforce. Additionally, the total output from manufacturing was $38.67 billion in 2018. Today, there are more than 5,234 manufacturing-related companies in Kentucky employing more than 290,076 workers. These and many other factors have significantly influenced manufacturing to become a leading industry. To further evidence this, 18% of the state's GDP comes from this sector.
Manufacturing is part of the primary sources for resident employment, employing a considerable percentage of the population. Another factor is the compensation, with an average annual wage of $72,614.25 in 2018. If your manufacturing business in Kentucky is struggling with fast growth and that’s affecting your cash flow, you can benefit from our financing manufacturing services today.
Kentucky is famous in the agriculture world for many things, including the annual Kentucky Derby. Cattle, horses, and other livestock make up a significant portion of Kentucky's agriculture and majorly contribute to the state's GDP. Kentucky is also a large producer of tobacco, soybeans, and corn. Historically, coal mining has been a primary economic source in Kentucky and remains so to this day. Kentucky is the fifth-largest producer of coal in the nation.
On average, this sector employed 6,612 persons, 3,906 underground coal miners, 1,531 surface miners, 887 preparation plant workers, and 288 on-site office staff in 2016. After more than two centuries of commercial mining operations, Kentucky's domestic coal supply remains an essential component of the Commonwealth's economy. 1st Commercial Credit offers agriculture invoice factoring for agribusinesses in need of a reliable and immediate source of funding.
A factoring company (or accounts receivable factoring) converts invoices sold on credit terms to immediate working capital at a discount. It has become a simple, fast and easy way to access business cash flow. In comparison with a traditional bank loan, a company that factors receivables has a quicker approval process.
1st Commercial Credit is a factoring receivables company that specializes in evaluating accounts receivable and can make a prompt approval decision. The documentation requirements are not as lengthy, and the main requirement is that an applicant has invoices for work or orders that have already been satisfied. It also helps to have creditworthy customers. As long as a business has been in operation, meets revenue requirements, and is free of liens or legal issues, approval is likelier.
However, many small businesses can’t afford to wait several weeks for payment. They need that cash sooner to pay for their own expenses. The big issue arises when many startups and growing companies don’t consider the slow payments when looking into their finances. Before they know it, money is out, and all their resources are tied to outstanding invoices. Thankfully, specialized lending companies have the perfect financial solution for businesses in this situation. Borrowing against receivables is a reliable and effective way to improve cash flow and finance businesses. It is way easier to get that many other traditional forms of financing. To qualify, your company needs to work with creditworthy clients and have outstanding invoices for orders or products already delivered.
2. Waiting On Customers To Pay You Back?
Many times when small business owners are dealing with insufficient cash flow is because of outstanding invoices. Invoice factoring is a quick and easy solution to help turn around this situation. Even though waiting for customers to pay off their existing balances can be frustrating, invoice factoring can help you get through this challenge. When applying for business loans or other financing options, they will demand a long list of requirements, and it takes months to approve your application.
Sometimes, it will take even more time to receive the financing your business has been approved for. With invoice factoring, business owners will have immediate access to cash without making you go through a long and complicated process. This is an especially viable option for those with short-term financing needs who can’t afford to wait several weeks or months to get the funds or don’t want to wait for customers to pay back. A specialized lending company can provide an invoice factoring quote right away after evaluating your application so you can begin solving your cash flow issues today.
3. Bank Loan or Factoring?
When researching bank loans and invoice factoring as possible funding options, the costs associated in the long run with it should be considered. Bank loans typically have a long list of requirements, including a good credit score and collateral. They also will add debt to your business because of high interest fees. Many small businesses will not even have the opportunity to qualify for bank financing because of less-than-perfect credit history or time in the industry.
To select the better option, extensive research has to be done by the business owner because every business situation is different and unique. Multiple factors will ultimately impact your decision, but the two main ones to consider are how fast you need the funds and the costs associated with the financing service. Invoice factoring and bank loans provide cash to businesses, but how they do it is very different.
Invoice factoring, for example, is a funding solution that gives businesses with cash flow issues access to immediate cash. It works by having a company sell its invoices to a third party at a slight discount while taking advantage of various extra benefits. So to be clear, factoring is not at all the same as borrowing money from a financial institution. With factoring, a business is selling an asset (accounts receivables), so nothing is owed to the lender, and there is no extra debt added to the company.
On the other hand, borrowing money from a bank usually involves a traditional loan or line of credit. With this borrowing method, a business owner pays the principal and the interest that comes with it until the loan is fully repaid. In many cases, traditional bank loans will end up costing businesses a lot more in the long run. Factoring allows you to choose which invoices to factor in and on how often. Companies will not be tied into a long-term contract and can enjoy the utmost flexibility that factoring offers.
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