You’ve delivered the product completed the project or provided the service. The invoice has been raised but now comes the wait.
For many businesses 30 60 or even 90 day payment terms can create a significant gap between completing the work and having the cash available to use. When your business is growing that gap matters.
The impact of waiting for payment
While you are waiting for customers to pay wages still need covering suppliers still need settling and new orders still need fulfilling. The next opportunity may also arrive before your previous customer has paid.
Without sufficient working capital long payment terms can make it more difficult to manage day to day costs or take advantage of opportunities for growth.
How Invoice Finance could help
Invoice finance can help bridge the gap between raising an invoice and receiving payment.
Rather than waiting for customer invoices to reach their payment date your business could access an agreed percentage of their value earlier. This can help keep cash moving through the business and provide greater certainty when planning ahead.
What could your Business do with improved Cash Flow?
Accessing funds tied up in unpaid invoices could give your business the flexibility to:
- Meet day to day operating costs
- Pay suppliers on time
- Take on larger orders
- Recruit additional staff
- Purchase stock or materials
- Invest in the next stage of growth
Invoice finance is not about waiting for cash flow to catch up. It is about making sure your business growth does not have to wait with it.
If delayed customer payments are placing pressure on your cash flow speak to our team to explore whether invoice finance could support your business.
Case Study
A growing business had approximately £78,800 tied up in outstanding customer invoices. Although the work had been completed, the business was waiting for customers to pay under their agreed payment terms.
An invoice finance facility offering an advance of up to 85% could release approximately £67,000 from the existing sales ledger. This could provide the business with immediate working capital to meet ongoing costs, pay suppliers and continue accepting new work without waiting for previous invoices to be settled.
As customers pay their invoices, the remaining balance would be released, less the funder’s agreed fees and charges.
If delayed customer payments are placing pressure on your cash flow, speak to our team to explore whether invoice finance could support your business.
