Invoice Factoring For Wholesale Companies and Wholesalers
Most product wholesalers have to provide payment terms when they sell their products to commercial or government customers. It’s common to offer up to 60 days to pay for the invoice. The problem is that most, especially small companies, have to pay their own suppliers much sooner than that. This can create a cash flow problem because you have major expenses that have to be paid long before you will be able to collect the invoice.
Factoring can provide the funds wholesalers need to pay suppliers and meet other expenses. To structure a transaction, your company partners with GMA Factor which advances cash using your slow paying invoices as collateral. The transaction is settled once your customer pays the invoices in full. An invoice factoring transaction relies on the credit strength of your customer, rather than the credit strength of your company. This makes it an ideal solution for small wholesalers that don’t have substantial collateral.
With invoice factoring, your line grows easily with your sales, provided you are selling products to customers with good credit rating. This feature, in combination with being easier to obtain than conventional loan, makes invoice factoring an ideal cash flow solution. Here is how invoice factoring works:
- Your wholesale company provides goods and/or services to creditworthy customers and then invoices them with a copy sent to GMA Factor
- GMA Factor will fund your business with an immediate payment of up to 99% of the received amount.
GMA Factor does not sign you on to any long-term contracts. Our agreements allow you the flexibility to factor what you want, when you want. You can pick and choose the accounts that you want to factor. Get started immediately by filling out the quick application on the right-hand side of this page or go to our online or downloadable application.