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Mergers, Acquisitionsand Capital ResourcesSince 1956                        Factoring Accounts Receivables to Improve Cash...
Our Expertise  Brian P. Ballo, Managing Director   Corporate Finance Associates   Experienced Investment Banker      Ser...
CFA has Global Transaction Capabilitiesin a Wide Range of Industries    CFA has over 40 offices in            Breakdown of...
Improving Cash Flow would Benefit Your Business You Performed Services…         You Delivered Goods…    Now, You are Waiti...
Bank Loans Have Become Scarcer And Smaller    The Recession has made borrowing more difficult        Credit Standards fo...
Instead of Borrowing: Invoices or AccountsReceivables (AR) are Business Assets that can be Sold     List of Business Asset...
Collection Time Determines the Factor’s Fee,With the Balance Remitted to the Company   Company Income                     ...
You Maintain Control in the Factoring Process  You select which Invoices      Factoring Leverages Technology   You want t...
Good Reasons Exist to Hire Brian Ballo                    Brian brings Expertise to the Factoring process                 ...
CFA Represents Your Business inArranging Competitive Market Terms   As investment bankers, Corporate       CFA’s Factorin...
CFA will Help Process Your Factoring Applicationand Leverage CFA’s Factoring Relationships   Factoring Application Process...
CFA can Skillfully Cause Your Lenderto Cooperate with the Factoring Process    Issue: Your accounts receivables are alrea...
If You Have Creditworthy Customers, CFA WillDeliver a Factoring Proposal    Q: Are you tired of waiting 30, 60, 90 days o...
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Factoring Accounts Receivable Can Improve Cash Flow

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Financing is currently available for your middle market business despite the lingering Credit Crunch. While traditional banks have tightened credit standards on cash flow based business loans, commercial finance lenders are actively lending to fill the operating capital needs of businesses by making asset-based business loans.

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Factoring Accounts Receivable Can Improve Cash Flow

  1. 1. Mergers, Acquisitionsand Capital ResourcesSince 1956 Factoring Accounts Receivables to Improve Cash Flow Brian P. Ballo, Managing Director Corporate Finance Associates 23046 Avenida de la Carlota, # 600 Laguna Hills, CA 92653 P: (949) 735-6500 brianb@cfaw.com Securities offered through Corporate Finance Securities, Inc. Member FINRA/SIPC
  2. 2. Our Expertise Brian P. Ballo, Managing Director Corporate Finance Associates  Experienced Investment Banker  Serving Lower Middle-Market Companies for over 50 Years  Corporate Attorney background  Over 40 Offices Located  Factoring and UCC Specialist Across North America, Europe and India  Worked with CEOs and CFOs for 25 years  An Independent and Unbiased Investment Banking Firm  Established Relationships with Factors and Funding Sources  Extensive Relationships with Capital Sources  Clients Work with a Senior Principal from Start to Finish
  3. 3. CFA has Global Transaction Capabilitiesin a Wide Range of Industries CFA has over 40 offices in Breakdown of CFA Clients North America, Europe, and India By Industry: Business Services 8% Energy 8% Other Industries 28% Engineering/ Construction 4% Equipm ent 6% Food/Beverage 5% Transport/ Logistics Healthcare 9% 8% Printing 4% Inform ation Plastics/Rubber Technology 5% Metal Fabrication 7% 8% 3
  4. 4. Improving Cash Flow would Benefit Your Business You Performed Services… You Delivered Goods… Now, You are Waiting to Receive Payment on outstanding Invoices
  5. 5. Bank Loans Have Become Scarcer And Smaller  The Recession has made borrowing more difficult  Credit Standards for business loans have tightened.  The Shift is from Cash Flow lending to Asset Based lending.  Asset Based loans are secured against specific collateral.  Even if Your Business qualifies for a Bank loan:  Covenant: You must maintain positive Cash Flow.  Covenant: You cannot exceed a total leverage ratio.  Covenant: You must maintain a minimum net worth.  The Bank will require a Security Agreement and file a UCC-1 which over-collateralizes the loan with all business assets.
  6. 6. Instead of Borrowing: Invoices or AccountsReceivables (AR) are Business Assets that can be Sold List of Business Assets: Factoring is selling AR  Real Estate at a discount  Equipment  Depending on Your Customer’s creditworthiness,  Inventory the Factor will typically advance 75% - 95% of the  Furnishings and fixtures invoice amount within a few days after underwriting.  Accounts Receivables  This is called the “Advance  Intellectual Property Rate”.  Stock in Other Companies
  7. 7. Collection Time Determines the Factor’s Fee,With the Balance Remitted to the Company Company Income Factor’s Fee  Once the Factor purchases the  Your Company’s AR / Invoice is invoice, the Factor collects from Sold in exchange for: the customer.  Advance Rate (75%-95% of  The amount of time it takes for Invoice) the customer to pay, determines  Less the Factor’s Fee and the Factors fee (typically, 3% if Broker’s Fee collection in less than 30 days, plus 1% for each extra 10 days).  Plus the Reserve Release (paid to You after the Factor collects)  CFA’s Broker’s fee is in addition to the Factor’s Fee.
  8. 8. You Maintain Control in the Factoring Process  You select which Invoices Factoring Leverages Technology You want to sell to Improve Cash Flow  on an invoice-by-invoice  Internet-based factoring systems, basis. allow you 24/7 online account access.  You control factoring costs  Invoices can be submitted online, or via fax.  by factoring on an "as  Advances and Reserve Release done needed" basis, or via wire transfers.  by agreeing to factor a  Factors will also perform credit checks minimum monthly on new or existing customers, usually amount of invoices. at no cost. This helps You determine:  whether to do business with particular customers, and  whether their invoices are eligible to be factored.
  9. 9. Good Reasons Exist to Hire Brian Ballo Brian brings Expertise to the Factoring process  16 years – Investment Banker with Factor relationships  25 years – Corporate Attorney with UCC legal experienceBrian P. BalloManaging Director  LL.M. in Tax from the University of San Diego School of Law (1990).(949) 735-6500brianb@cfaw.com  J.D. from California Western School of Law (1986) Lead Articles Editor, Law Review.  B.G.S. degree from the University of Michigan (1978).  Member: California and Colorado Bars.  California Real Estate Broker license.  FINRA Series 7 and 66 securities licenses.  Member: Association for Corporate Growth.  Attendee at Commercial Finance Association events.
  10. 10. CFA Represents Your Business inArranging Competitive Market Terms  As investment bankers, Corporate CFA’s Factoring Services: Finance Associates represents Your business.  Arranging not only competitive pricing, but also a flexible and  As a broker, CFA is independent and customized financing program can access the full-range of capital that is structured to meet Your sources. unique needs.  Brian Ballo will match your business Risk of Picking a Factor Yourself: with a Factor that:  Being put into a funding box,  understands Your industry, and with a canned program that over-  Your method of doing business. charges because the Factor does not really understand Your industry and business.
  11. 11. CFA will Help Process Your Factoring Applicationand Leverage CFA’s Factoring Relationships Factoring Application Process: Key Benefits of Working with an  Brian Ballo will personally work Experienced Factoring Broker: with Your CFO, accountant,  Brian Ballo will cut through the bookkeeper or accounts receivable documentation maze, saving You person. time.  A single Factoring Application is  Brian has established relationships used. with Factors that have available  Brian distributes the Application to capital with which to purchase Your appropriate funding sources. AR.  All Factors want an AR Aging  Bottom Line: CFA delivers Term Report. Sheet and Closes Factoring Transactions.  Some factors want to financial information on Your Company, while others do not.  Brian will get the right information directly to the Factors underwriter.
  12. 12. CFA can Skillfully Cause Your Lenderto Cooperate with the Factoring Process  Issue: Your accounts receivables are already be pledged to Your Lender  Your AR is securing an existing working capital line of credit or senior term loan.  Most factors don’t help You in negotiating with Your Lender.  Instead, they expect You to ask Your bank if the bank will cooperate in subordinating the banks lien rights against your AR.  Solution: Brian Ballo has experience in requesting that Your bank sign an Inter-Creditor Agreement with the Factor.  This crucial step must occur to enable the AR to be sold to the Factor.  Thus, CFA performs essential work which your factor doesnt perform.  Moreover, Brian Ballo knows how to accomplish this a way that actually improves your banking relationship.
  13. 13. If You Have Creditworthy Customers, CFA WillDeliver a Factoring Proposal  Q: Are you tired of waiting 30, 60, 90 days or more to get paid on Invoices?  Q: Are you ready to grow your business by receiving cash in the short term?  Q: Do you want an experienced professional to deliver a factoring funding proposal ? If Your Answer is “Yes”, then call Brian Ballo, or complete the online form. Brian looks forward to speaking with you. Brian P. Ballo, Managing Director Corporate Finance Associates 23046 Avenida de la Carlota, # 600 Laguna Hills, CA 92653 P: (949) 735-6500 | brianb@cfaw.com Securities offered through Corporate Finance Securities, Inc. Member FINRA/SIPC

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