As more businesses reopen in cities across the United States, cash flow is becoming the prime concern. Cash flow determines how quickly businesses will recover over the next few months and position themselves for long-term success.
What Cash Flow Means to Businesses
Cash flow allows businesses to make payroll and cover overhead. Cash flow allows businesses to restock inventory, purchase supplies, and hire employees. As businesses reopen, the rising demand from customers will require businesses to have revenue coming in at a steady rate so they can cover expenses. However, invoices with staggered schedules of 30 days or more can create gaps in cash flow. Those gaps mean businesses cannot cover the cost of client orders, payroll cannot be made, and financial obligations cannot be met. Still, while staggered schedules on invoices are a standard business practice, commerce occurs at a faster rate, so businesses need a solution that can provide near-parity with the rate of sales. Businesses that continue to plod along with gaps in cash flow end up relying on short-term loans, and with banks tightening their requirements, even traditional lending methods may be off the table for some companies.
Speed Up Your Cash Flow
Fortunately, there is a way for businesses to effectively speed up cash flow and eliminate gaps in revenue. Accounts receivable financing allows businesses to exchange unpaid invoices for cash, which is made available within 24 hours. This is a simple and elegant solution that does not place any debt on the balance, so businesses do not have to fall back on traditional loans. The fast turnaround times on invoices eliminate staggered payment schedules to bring sales and revenue more in-line with each other. The resulting cash flow not only allows businesses to cover expenses, it also helps businesses to build capital reserves for unexpected expenses and growth projects. Accounts receivable financing will play an important role in any business that wants to bounce back after pandemic restrictions are lifted.
Improve Your Cash Flow
Web Finance Direct provides accounts receivable financing and other working capital solutions for businesses nationwide. If you want to improve your cash flow, contact Web Finance Direct today.