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Understanding The Merits Of Invoice Factoring For Your Business in 2017

Understanding The Merits Of Invoice Factoring For Your Business in 2017
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The majority of businesses get stuck financially not because they lack money but due to the fact that they cannot access their hard cash. Sometimes, clients may delay payments for up to 90 days. During this period, a company can make use of invoice factoring to keep the business afloat. We will look into all that you need to know about invoice factoring and the merits it has for your business.

What is Invoice Factoring?

Many terms can define invoice factoring. For example, you may hear some calling it “invoice financing” and others calling it “accounts receivable factoring”. All these names mean the same thing, which is invoice factoring.

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Invoice factoring is the process of ‘selling’ owed invoices to a lender. Broadly speaking, it allows you to use your money before you receive it. There are more than enough benefits to make invoice factoring worthwhile for your business. We will highlight some of the merits of invoice factoring for your business.

Quick Access to Cash

One of the many reasons invoice factoring is important to your business is because it allows you to get quick approval of loans from banks when you need the money. The majority of small and medium-sized businesses have a major problem in accessing bank loans or any other form of financial assistance. However, invoice factoring makes it easy. You can process a loan within a day or two if you are using invoice factoring services. However, it is important to note that the amount of money you get as a loan is purely dependent on the sum of your outstanding invoices. Most likely, a bank will give you a loan for 90% of your outstanding invoices.

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Relief from Invoice Collecting

One of the hardest tasks businesses face is collecting invoices. For a small business, this may mean employing new staff to follow up on such matters. It is clear that such a move is likely to raise the cost of operation of a business. If you can find a good company offering invoice factoring services, you will not have to follow up on your clients to get your money. You can use your money without hustling to get it. It is a relief, especially if you are dealing with clients who are notorious for not paying debts on time or at all.

Meet the Daily Customer Demand

It is easy for a small or medium-sized business to be forced to close down simply because they cannot meet the daily demands of customers. A company with outstanding invoices can fail to provide for its daily costs of operation if it does not use invoice factoring. Invoice factoring helps the company to get the money needed to keep the daily activities of the business running to meet the customer demand.

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Filling Large Customer Orders

With invoice factoring, you do not have to let go of large orders. When you have a customer with a large order, you can seek money and attend to that order instead of letting that offer go simply because you do not have enough money to attend to the order. This is a benefit to both small and medium-sized businesses that are still seeking opportunities to get hold of large orders. Therefore, when such orders come, such businesses should use all the possible resources they have access to, including invoice factoring, to get hold of the order.

Easy Approval Criteria

Not only does invoice factoring give you a way of getting bank loans, but it also provides ways to get such loans the easy way. With invoice factoring, you do not need to add your personal assets as security for the loan for which you are applying. This means that you can apply for and get a loan very quickly without having to go back to your list of assets.

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As discussed above, it is clear that invoice factoring is very beneficial to your business. You should consider using this option so that you can enjoy the above benefits plus many others.

Featured photo credit: FactoringCompanies198 via flickr.com

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Deborah Belford

Freelance journalist

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Last Updated on July 21, 2021

The Importance of Reminders (And How to Make a Reminder Work)

The Importance of Reminders (And How to Make a Reminder Work)
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No matter how well you set up your todo list and calendar, you aren’t going to get things done unless you have a reliable way of reminding yourself to actually do them.

Anyone who’s spent an hour writing up the perfect grocery list only to realize at the store that they forgot to bring the list understands the importance of reminders.

Reminders of some sort or another are what turn a collection of paper goods or web services into what David Allen calls a “trusted system.”[1]

A lot of people resist getting better organized. No matter what kind of chaotic mess, their lives are on a day-to-day basis because they know themselves well enough to know that there’s after all that work they’ll probably forget to take their lists with them when it matters most.

Fortunately, there are ways to make sure we remember to check our lists — and to remember to do the things we need to do, whether they’re on a list or not.

In most cases, we need a lot of pushing at first, for example by making a reminder, but eventually we build up enough momentum that doing what needs doing becomes a habit — not an exception.

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From Creating Reminders to Building Habits

A habit is any act we engage in automatically without thinking about it.

For example, when you brush your teeth, you don’t have to think about every single step from start to finish; once you stagger up to the sink, habit takes over (and, really, habit got you to the sink in the first place) and you find yourself putting toothpaste on your toothbrush, putting the toothbrush in your mouth (and never your ear!), spitting, rinsing, and so on without any conscious effort at all.

This is a good thing because if you’re anything like me, you’re not even capable of conscious thought when you’re brushing your teeth.

The good news is you already have a whole set of productivity habits you’ve built up over the course of your life. The bad news is, a lot of them aren’t very good habits.

That quick game Frogger to “loosen you up” before you get working, that always ends up being 6 hours of Frogger –– that’s a habit. And as you know, habits like that can be hard to break — which is one of the reasons why habits are so important in the first place.

Once you’ve replaced an unproductive habit with a more productive one, the new habit will be just as hard to break as the old one was. Getting there, though, can be a chore!

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The old saw about anything you do for 21 days becoming a habit has been pretty much discredited, but there is a kernel of truth there — anything you do long enough becomes an ingrained behavior, a habit. Some people pick up habits quickly, others over a longer time span, but eventually, the behaviors become automatic.

Building productive habits, then, is a matter of repeating a desired behavior over a long enough period of time that you start doing it without thinking.

But how do you remember to do that? And what about the things that don’t need to be habits — the one-off events, like taking your paycheck stubs to your mortgage banker or making a particular phone call?

The trick to reminding yourself often enough for something to become a habit, or just that one time that you need to do something, is to interrupt yourself in some way in a way that triggers the desired behavior.

The Wonderful Thing About Triggers — Reminders

A trigger is anything that you put “in your way” to remind you to do something. The best triggers are related in some way to the behavior you want to produce.

For instance, if you want to remember to take something to work that you wouldn’t normally take, you might place it in front of the door so you have to pick it up to get out of your house.

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But anything that catches your attention and reminds you to do something can be a trigger. An alarm clock or kitchen timer is a perfect example — when the bell rings, you know to wake up or take the quiche out of the oven. (Hopefully you remember which trigger goes with which behavior!)

If you want to instill a habit, the thing to do is to place a trigger in your path to remind you to do whatever it is you’re trying to make into a habit — and keep it there until you realize that you’ve already done the thing it’s supposed to remind you of.

For instance, a post-it saying “count your calories” placed on the refrigerator door (or maybe on your favorite sugary snack itself)  can help you remember that you’re supposed to be cutting back — until one day you realize that you don’t need to be reminded anymore.

These triggers all require a lot of forethought, though — you have to remember that you need to remember something in the first place.

For a lot of tasks, the best reminder is one that’s completely automated — you set it up and then forget about it, trusting the trigger to pop up when you need it.

How to Make a Reminder Works for You

Computers and ubiquity of mobile Internet-connected devices make it possible to set up automatic triggers for just about anything.

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Desktop software like Outlook will pop up reminders on your desktop screen, and most online services go an extra step and send reminders via email or SMS text message — just the thing to keep you on track. Sandy, for example, just does automatic reminders.

Automated reminders can help you build habits — but it can also help you remember things that are too important to be trusted even to habit. Diabetics who need to take their insulin, HIV patients whose medication must be taken at an exact time in a precise order, phone calls that have to be made exactly on time, and other crucial events require triggers even when the habit is already in place.

My advice is to set reminders for just about everything — have them sent to your mobile phone in some way (either through a built-in calendar or an online service that sends updates) so you never have to think about it — and never have to worry about forgetting.

Your weekly review is a good time to enter new reminders for the coming weeks or months. I simply don’t want to think about what I’m supposed to be doing; I want to be reminded so I can think just about actually doing it.

I tend to use my calendar for reminders, mostly, though I do like Sandy quite a bit.

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Featured photo credit: Unsplash via unsplash.com

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Reference

[1] Getting Things Done: Trusted System

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