Companies that provide accounts receivable financing, or AR financing, will offer services at different levels. Often you are expecting to receive services that compensate for the amount of money you are paying for the service. For this reason, you should ponder what is important for you and your business before choosing an A R factoring company. You should do a thorough investigation of which Commercial Financing Companies you would like to work with.
There are AR Financing firms of all kinds. There are the ones that charge low fees but provide bad service. If you choose low fees over service you may end up waiting on the phone for hours on end, or talk to someone that does not really care to solve your problem. The truth is, the reason why they offer low fees is because they have bad service. Good service is not a priority for them. This is why you should not compromise the quality of the service just for the low fees. The costs eventually add up and end up being much higher.
Fortunately, there are AR Financing firms that provide good service. These firms are usually smaller and more difficult to find because they may not advertise much. However, they may be your best option. Because they are small, they provide more personal assistance and are easy to reach. It is best to speak with a Commercial Finance Broker as they will know who is the best lenders for you type of business, plus most often they are paid by the lender so there is no additional costs to your company.
When your budget for AR Financing is limited, low fees can be enticing. Moreover, you are resorting to Financing because you want to increase cash flow not spend a lot. However, it is important to know that there is a price to small service that you may be overlooking. The companies that opt for the lower fees, are frequently disappointed of their decision specially when they are at the early stages of a long term or short term commitment. Here paying more, pays off.
Finally, it is important to point out that the process of selection an AR Financing company is not easy. We advise you to consider first the level of service you wish to have, the one you need, and the one you can afford and if the difference is only of a few dollars a month choose the one that provides the best service. You need to analyze carefully and look at all sides of the equation when making a decision if Factoring is ideal for you business.