Cash Flow Solutions for Construction

No, the production you sell is totally up to you. You can request funding as required.

You can request funding as frequently as daily; our funding limits are based on your production.

Big to small crude oil producers often use factoring for operational and periodic expenses or large expenditures such as equipment purchasing, acquisitions, or business expansions that would typically require debt.

Speed - Clients get money in their bank accounts within hours from the time we verify their proof of delivery.

All In Fee Structure - We only have one fee so our clients never have any surprises. That means we never charge admin fees, schedule fees, reporting fees, or wire fees.

Experience - We have been factoring for over 20 years and offering factoring to crude producers since 2019.

Factoring is far from a new concept. In fact, it's a financial practice that has stood the test of time, dating back to ancient civilizations. It involves the sale of accounts receivable to a third party at a discount, enabling businesses to secure cash for outstanding invoices ahead of their due dates. This practice can also help mitigate the risks associated with unpaid invoices.

Factoring's origins can be traced back to ancient Babylon, where it was included in the Code of Hammurabi, one of the earliest known legal codes. The code allowed merchants to sell their debts to a third party at a discounted rate, providing them with quick access to cash to fuel their business operations.

Fast forward to the 1400s in Europe, factoring became a formalized industry during a period of rapid global trade expansion. Merchants needed a way to finance their operations, and factoring provided a solution, particularly for export/import, offering cash for outstanding invoices while reducing risk exposure.

In today's business landscape, factoring is a common practice across businesses of all sizes and spans various industries, including manufacturing, transportation, staffing, and notably, construction.

Factoring is particularly valuable in industries where payment cycles can be lengthy and/or unpredictable.

One of the key benefits of factoring is improved, predictable cash flow. By securing cash for outstanding invoices, businesses can unlock funds to invest in their operations, reducing financial distress and enabling them to seize growth opportunities.

Factoring also reduces risk exposure. When businesses sell their accounts receivable to a third party, they transfer the risk of non-payment caused by insolvency. This can be especially valuable in industries like construction, where non-payment remains a significant risk factor.

Lastly, factoring is a relatively simple and straightforward financing solution. Unlike traditional loans, factoring doesn't require collateral or extensive documentation, making it a viable option for businesses with limited credit history or assets for collateral.

In conclusion, factoring, one of the oldest forms of finance, continues to be a valuable tool for businesses, including those in the construction industry. By selling their accounts receivable to a third party at a discount, businesses can improve their cash flow, reduce risk exposure, and access a simple and straightforward financing solution. While the practice has evolved over time, its core principles remain the same, making it a useful financing option for businesses of all sizes and types.

No, production financing will not affect your credit rating. In fact, it doesn’t affect your debt service ratios or borrowing capacity, as it is not a loan.

No, factoring is not debt, and it does not show up as debt on your balance sheet; it is an off-book transaction.

Factoring, a financing option that provides businesses with instant access to cash by selling their accounts receivable, is not a traditional loan. It doesn't create a liability on the business's balance sheet, making it an attractive option for construction companies seeking a debt-free method to boost their cash flow.

One of the primary advantages of factoring is its ability to enhance a business's financial statements. Factoring transforms accounts receivable into cash, providing increased liquidity for the business. This liquidity can assist the business in meeting its financial obligations and capitalizing on growth opportunities. Moreover, factoring can decrease the risk of bad debts and having the cash available to pay its accounts on time will improve the business's credit rating. Eventually, this will facilitate easier access to financing in the future.

When a business sells its accounts receivable to a factoring company. The business is trading some of its future cash flows for immediate cash, which can create off-book debt. While factoring doesn't create a liability on the balance sheet, the sale of accounts receivable can impact the business's future cash flow, as it will no longer be able to collect payment on those invoices.

It's vital for businesses to thoroughly consider the potential impact of off-book debt before opting for factoring. While factoring can be a beneficial financing tool for businesses needing to enhance their cash flow, it's crucial to fully comprehend the terms of the factoring agreement and its potential impact on the business's financial statements.

In summary, factoring is a debt-free financing solution that can offer businesses, particularly in the construction industry, the flexibility and cash flow they need to thrive. However, businesses should be cognizant that factoring can create off-book debt, which can affect their financial statements and distort the accurate assessment of their financial position. It's essential for businesses to balance the potential benefits and risks of factoring before deciding if it's the right financing option for them.