Commercial financing for small to mid-sized businesses requires innovation. Business owners need to be pragmatic when it comes to growing their businesses. But, in addition they need money when opportunity comes knocking. One of the ways they’re taking control of their business growth is using a commercial financing process that enables them to auction off their accounts receivable.
Here’s how it works:
1. Apply online – The receivables auction marketplace offers an application for membership online. The small to mid-sized company owner can fill this out in about 15 minutes. Once the applying 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 newest seller can download the applying with 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 vendor is ready to find the accounts receivable they wish to post for auction. For as long so long as the sum total auction amount exceeds $10,000, the vendor can post any commercial invoices they want.
Tip: The easiest way to get cash quickly and efficiently is to post invoices of well-known, investment-grade account debtors with great credit histories. These tend to get 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 will accept from bidders, the utmost discount fee they will pay and the length of time the auction will last. Owner can decide to perform it from 3-10 days.
5. Sale transaction occurs – You can find two ways this can occur. Once the auction closes, the Buyer with the greatest bid that meets the parameters set by the vendor wins the auction. One other option is that the vendor can set a “Buyout Price “.This is comparable to the “buy it now” option on eBay. Each time a Buyer agrees to the “Buyout Price” the auction is immediately closed and awarded to that particular Buyer.
6. Get commercial financing fast – Once the sale undergoes, the funds are electronically deposited into an account for the seller. This happens within 24 hours of the auction close.
With money in hand, possibly in as little as one day, small to mid-sized business owners give themselves a bonus within the competition. They have the way to grow their business now as opposed to looking forward to invoice payments to come in. Commercial financing using their accounts receivable allows them to tap into funds that normally take 30-90 days to come 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 as opposed to later. Through invoice financing, small to mid-sized business owners can control the fate of their ventures with little risk, few restrictions and total control. Opportunities won’t wait.