A growing business such as this should be happy with this kind of activity but unfortunately rapid growth is very hard to sustain. It wipes out vital cash flow needed for overhead (particularly payroll and inventory replacement). The owner was told about factoring and reached out to Xynergy Commercial Capital (XCC) for help with her problem. Her personal credit was about average (which in this economic environment is somewhat low), and she had no ability to borrow from a bank. However, factors do not look solely at the applicant’s creditworthiness; most of the decision is based on the payer’s/debtor’s credit profile. XCC was quick to respond and gather up and evaluate the appropriate documents. Her business was making money, and well able to sustain the 4%-5% discount fee charged by XCC for its services.
Within a two week period the transaction was fully underwritten and funded. With this new and very practical way to grow her business, the owner now had more than enough cash flow. She even began to pay her suppliers and vendors early so she could get 5% off on her supplies and component parts.
The bigger your customer the more demanding of cash flow it requires. Xynergy’s accounts receivable funding program is a real solution for a real problem.