Have you ever heard of a company offering a 2% – 10 net 30 discount?
Of course! It’s a common practice to reward rapid paying customers … but what does this really cost?
A 2%-10 net 30 discount, if you convert it into conventional terms comes out to be 6% over 30 days and 72% over the course of a year … so why would you not factor the invoice for less than have of that cost?
Understanding the “time value” of money is a difficult lesson. So when should you consider factoring?
- When you are turning away customers or orders because you are not getting paid in a timely manner.
- When you don’t have a solid credit department to help you protect yourself from selling to someone that won’t pay you!
- Your company has accelerating sales and cannot borrow as much money from the bank as you need to meet those demands.
Put our experience to work for you today. We’re the perfect partner: We’re there when you need us and ready and waiting when you don’t. Best of all? We cost less than you transacting your sale via credit cards – so call me today at 1-603-818-4778. I’m Ernie Brown and I’m happy to help!