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 way they are taking control of the business growth is with a commercial financing process which allows 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 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 two weeks on average.
2. Download auction application – Once approved for receivables trading, the new seller can download the application form for their computer. This Business Loans Dorset desktop application provides use of the live, online receivables auction platform where buyers and sellers have 24/7 use of auctions and transactions.
3. Choose invoices – Now, owner is ready to find the accounts receivable they wish to post for auction. So long provided that the full total auction amount exceeds $10,000, owner can post any commercial invoices they want.
Tip: The easiest 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 best rates of capital.
4. Set parameters and post – The seller maintains control by setting the parameters of the auction. The seller decides the minimum advance amount they will accept from bidders, the maximum discount fee they will pay and just how long the auction will last. The seller can decide to run it from 3-10 days.
5. Sale transaction occurs – There are two ways this will occur. When the auction closes, the Buyer with the best bid that fits the parameters set by owner wins the auction. The other option is that owner 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 Buyer.
6. Get commercial financing fast – When the sale undergoes, 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 as low as 1 day, small to mid-sized business owners give themselves a plus over the competition. They’ve the way to grow their business now rather than waiting for invoice payments in the future in. Commercial financing utilizing 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.