Invoice factoring is utilized by businesses in almost every industry where invoices are issued with payment schedules of 30, 60, or 90 days. The purpose of invoice factoring is to give businesses faster access to revenue while reducing the need for debt-based financing. But how do specific industries use invoice factoring beyond its basic purpose?

Staffing Agencies

Staffing agencies source skilled employees for roles in the private and public sectors, ranging from day laborers to data migration specialists, executive administrative roles, and everything in between. The invoices they send to employers typically get paid on a monthly to quarterly basis, and that revenue is used to source more talent and cover overhead for the staffing agency. Additionally, staffing agencies rely on a constant influx of revenue to pay the people they have placed in various roles. However, because of the staggered payment schedules, staffing agencies frequently have uneven revenue cycles and cash flow strains. To resolve this and ensure there is always a healthy cash flow, staffing agencies use invoice factoring to get immediate access to revenue. By factoring unpaid invoices, staffing agencies not only cover payroll and overhead, but they are able to take on larger client accounts, source more skilled candidates, and tap into new markets to expand their operations.

Manufacturers

Invoice factoring allows manufacturers to get faster access to revenue when they issue invoices to their customers. Increased cash flow is essential to a high-demand sector like manufacturing. Beyond accelerated revenue, manufacturers are able to hire workers, upgrade equipment, keep raw materials on hand, and more. For manufacturers, invoice factoring allows them to build up capital to invest in new product research, take on new clients, and expand their market reach.

Oil and Gas Industry

The oil and gas industry is vast and segmented, but invoice factoring is used at almost every level. Research and exploration often require specialists. Refining, distribution, and delivery involve a network of shippers and businesses, and invoices are being generated constantly. If there is a gap in cash flow, production can grind to a halt, and would impact other segments right down to the consumer level. Invoice factoring ensures the oil and gas industry can supply the public, private, and residential sectors so our country can keep moving. Additionally, the accumulated capital allows the industry to perform research into new and cleaner products, better delivery, and growth.

Wholesale and Distribution

Wholesale and distribution covers a wide range of raw materials and products that include construction materials, medical supplies, equipment, consumer goods, electronics, and more. Wholesalers and distributors handle business domestically and abroad, and rely on a strong cash flow to not only source materials and goods, but also to ensure they arrive on time to their customers. To keep business moving and ensure people and organizations get the items they need, wholesalers and distributors cannot wait 30 to 90 days for their customers to pay their invoices, and they definitely cannot afford to let receivables age out to collections. Because of this, wholesalers and distributors use invoice factoring. The accelerated cash flow resulting from invoice factoring allows wholesalers and distributors to keep products and materials in stock, expand their offerings, grow their operations, and take on larger clients.

Transportation/Freight

The transportation/freight industry is integral to all facets of our economy. Truckers move everything from small electronic components to livestock, raw materials, heavy machinery, pharmaceuticals, and more. Waiting 30, 60, or 90 days for customers to pay their invoices can result in transportation companies being unable to make payroll, unable to purchase fuel for vehicles, and everything else needed to keep our economy rolling. Freight bill factoring allows transportation companies to cover expenses, grow their operations, take on new accounts, and expand their fleets. Factoring also ensures that supply chains keep moving across the United States so businesses and consumers have access to the products and materials they need and want.

If you want comprehensive factoring services that will convert unpaid invoices into cash and make funds available within a single day, get started today with Single Point Capital.