The nature of a service business is a good match for many entrepreneurs.
A small business in this industry can provide a number of services, including those in the following realms:
- Marketing & Sales
- Professional service (such as a law or accounting firm)
However, you will discover that invoicing in the service business has its own set of challenges. When providing a service to another business (B2B), businesses bill on 30, 60 and 90-day terms.
These service contracts are valuable to your business, but offering terms as long as 90 days can leave you scrambling to meet payroll needs, purchase supplies, or cover operating costs.
What about a bank loan? While a bank loan seems like the only option, small business owners don’t always have that option. Even for an established business with a great credit score, a bank loan can take months to process before you see the funds. That is why factoring is vital to companies in the service industry, and you can go from application to funds received in 7 to 10 business days.
The Solution? Factoring.
Our experts provide factoring services with a focus on customer care and support. We want you to be comfortable, informed and educated about the process. We take the time to answer your questions and make sure you are fully aware of your options as a business in need of better cash flow. With factoring, your business will have fast access to the capital owed to you through your invoices.
As a client of United Capital Funding, here’s how it works:
- First, you fulfill the agreed-upon service laid out in your agreement with your customer.
- Then, generate an invoice for the total amount of the service provided and send copies to your customer and United Capital Funding.
- Our experts will verify the invoice, then wire a large percentage (typically 80%) of the invoice amount to your account, holding the remaining percentage (20%) until your customer pays the full invoice amount to our secure lockbox.
- Once your customer pays the full invoice amount to our secure lockbox, our team wires the remaining percentage (less our fees) to your account.
- Voila! You’ve successfully unlocked that capital.
Factoring is a steady, long-term solution for your invoice management. We allow you to choose which invoices you want to factor and you can access your invoices and reports through our secure online platform, all at no extra cost.
What are the fees?
You will typically only encounter two types of fees – a fee for the cost of the capital and a banking fee (ACH or wire transfer charge). Our fees are drastically lower than the industry average, according to Pepperdine Graziadio Business School’s 2019 Private Capital Markets Project. This keeps your total costs down and your invoice cycle efficient. Visit our benefits page for more information. We offer customized proposals according to your specific needs. To receive a proposal, please submit an online application.
Please note, factoring is not a loan. It is an advance on pending payment by your customer, which means there is no repayment on your part.
Three Ways to Get Started
Good rates and no tricks. Three previous inquiries to other entities left a sour taste in my mouth. United Capital Funding’s knowledge base and reference list are also impressive.Owner, Service Company, Ohio
A leader in factoring for the service industry
Since 1997, our experts have helped service businesses grow by providing a service that traditional lenders can’t. We make it easier for you to get the funding you need to run your business.
We can do this even if you are a startup, an 8(a) contractor, or are a company with a recent history of a less-than-profitable performance.