Factoring Myths Can Cost Businesses $57K or More Annually
Industry insiders say that following misconceptions about invoice factoring can prove costly.
The latest guide dispels some of the most common myths about factoring and draws from recent research to uncover factoring benefits that are often overlooked. It notes that businesses often forego sales and projects due to insufficient cash flow, costing an average American business over $43,000 annually. Moreover, chasing invoices can be tied to over $14,000 in labor expenses annually for a typical company. Businesses can regain over $57,000 in lost capital by addressing these two things alone. Both have solutions rooted in factoring.
“Many business owners still believe myths like ‘factoring is only for struggling companies’ or ‘it's too expensive,’ which leads them to overlook a powerful tool,” says Greg DiDonna, President and Partner of Viva Capital. “Successful companies use factoring to maintain cash flow stability and fuel strategic growth, especially in high-demand markets.”
DiDonna notes that factoring provides most of an invoice’s value upfront. Many use the advance to take on large orders or projects, allowing them to recapture tens of thousands of dollars or more in opportunities that would otherwise be lost.
He also points to the benefits of factoring, such as collections services, that are typically part of a factoring agreement, and notes that these produce significant savings for businesses, too.
“Factoring is often the most cost-effective solution when opportunity costs and overall savings are taken into account,” DiDonna states. “It's not just about improving cash flow—it's about unlocking opportunities that would otherwise be out of reach. Compared to traditional loans and credit lines, factoring consistently proves to be a smarter, more flexible option.”
DiDonna further adds, “The businesses that thrive in today's competitive landscape think beyond conventional funding methods. Factoring allows companies to be more agile, enabling them to seize new opportunities and stay ahead of the curve.”
He encourages businesses to evaluate funding solutions on their own merit rather than simply accepting what they’ve heard as definitive truths, as factoring myths continue to prevail despite growing awareness of the solution.
Those interested in learning more about invoice factoring are encouraged to contact Viva Capital at VivaCF.net.
ABOUT VIVA
Founded in 1999, Viva helps B2B businesses of all types accelerate cash flow through specialized funding solutions like factoring, accounts receivable financing, and asset-based lending. Their simple qualification process makes it easy for small and mid-sized companies to get vital funding despite lack of credit or time in business. Additional information is available at VivaCF.net.
Armando Armendariz
Viva Capital Funding
+1 915-615-6664
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