Staffing Factoring and Payroll Funding

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1 Staffing Factoring and Payroll Funding

2 Staffing Factoring and Payroll Funding Invoice factoring and payroll funding makes it possible for staffing and temporary employers to expedite cash flow, providing an agency with immediate access to money customers owe them on the same day an invoice is generated, so they don t have to wait 15, 30, 60, 90 days or even longer for customers to pay. Expediting cash flow through factoring or payroll funding makes it easier to meet payroll and other operational expenses and reinvest working capital in your agency more quickly. Factoring improves your agency s ability to meet payroll and tax expenses on time, bring on additional clients, increase placements, and reduce accounting related expenses.

3 How the Process Works Your agency generates a customer invoice. Instead of waiting weeks (or months) for your customer to pay Factor the invoice with us and get free same day funding of up to 98% of the amount of the invoice for a small fee which could be as low as 1% of the amount of the invoice. Any remaining balance is held in reserve until the invoice has been paid. Once your customer pays the full amount of the invoice, any amount held in reserve is also returned to you.

4 Benefits of Staffing Factoring and Payroll Funding Agencies that factor invoices turn the money customers owe their agency into working capital that can be used immediately instead of waiting weeks or months for customers to pay. Faster access to capital could enable your agency to: More easily meet payroll and other operating expenses Offer generous credit terms to your clients as a competitive advantage Take on new customers or larger placements with existing customers Expand or add placements in new industries Reduce accounting-related costs Reduce or even eliminate your company s financial risk from bad debt (with non-recourse staffing factoring)

5 Additional Benefits of Non-Recourse Factoring DB Squared is a non-recourse factoring company. As our client, you ll receive the additional benefits of working with a nonrecourse factor without paying more. Choosing a non-recourse factoring company like DB Squared reduces your agency s financial risk from bad debt. When we factor an invoice, we also assume the credit risk for that invoice. If a customer is unable to pay for credit reasons, we absorb the loss not your business! Financing companies that factor with full recourse do not assume the credit risk for factored invoices and may require you to repurchase invoices that remain unpaid and cover legal or collections costs incurred.

6 Why Staffing Agencies Factor Staffing and temporary employment agencies commonly cite these drivers as relevant to their decision to factor with us: Improved ability to meet payroll and operating expenses Customer accounts with extended terms Slow-paying customer accounts To extend longer payment terms in order to attract new customers or match competitors offers To take advantage of emerging business opportunities, take on bigger clients or fill larger placement requests A desire to reinvest in business growth more quickly

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8 Why Factor with DB Squared? To stay in the driver s seat. As our client, you won t be required to factor a minimum number or dollar amount of invoices and you ll have the option of sending customer invoices or delegating the work to us. To get the best customer service: We rely on our service and performance to earn us client patronage and referrals. For low fees: Staffing factoring and payroll funding fees as low as 1%. For high advances: Get free same day advances up to 98%. To do what s best for your business: Many factors require clients to commit to long term contracts not us! We ll earn repeat business and referrals through performance. For non-recourse factoring: We assume the credit risk for invoices purchased.

9 To avoid early termination fees and auto-renewal windows: Check the fine print! Some factors charge hefty early termination fees and hide other penalties in auto-renewal windows assessing penalties as high as 10% of a client s line of factoring credit, making these fees almost unpayable. For free same day funding. For program transparency: No hidden fees to drive up the real cost of factoring No application fees No notification fees No reserve release fees No schedule or invoice processing fees No credit check or due diligence fees None! To get free credit checks on your customers.

10 Comparing Factoring Programs When comparing factoring proposals, remember to look for additional costs and add-on fees not just the discount rate being offered. These fees and charges may seem small, but when you do the math you can clearly see that they quickly eat into your profits: Long term contracts with stiff penalties and lots of paperwork required to leave or make changes Penalties or rate hikes that apply if monthly minimums aren t met Add-on fees for proposals, quotes, credit checks, due diligence, notification, schedule processing, etc. Introductory rates, fees or other favorable conditions that expire Lost customers due to poor customer service

11 Here are some questions that can help you choose the best factoring program for your business: What s the fee structure? What are the terms? How long does it take to get set up? How fast will invoices be funded? Are there monthly minimums? Will you have to sign a long term contract? Are there application, due diligence or other set up fees? How are the credit limits of your customers established? Who has control of invoicing? Are there early-termination penalties or auto-renewal windows? Are there add-on charges for processing schedules? Do you get free customer credit checks? Will you get the additional benefits of non-recourse factoring? Does the factoring company have enough capital to grow alongside your temp or staffing agency?

12 Factoring Can Help Your Agency If one or more of these describes your business, factoring could be an appropriate way to expedite your organization s cash flow: Cash flow isn t keeping pace with operational needs or payroll cycles You re continually chasing and waiting on customer payments You want to use longer payment terms to attract stronger customers You need capital to take on bigger customer accounts or fulfil larger orders You have strong, credit-worthy customers who expect longer payment terms Your agency is fairly young, and doesn t yet qualify for other types of financing You need capital to take advantage of supplier discounts Your agency could benefit from expedited cash flow and lower accounting-related costs

13 What You ll Love About Factoring with DB Squared Low fees factoring fees as low as 1% Free same day funding High advances up to 98% No monthly minimums; factor only when you choose No long term contracts or hidden penalties Free credit checks on your customers Option to delegate invoicing to us No hidden fees; no application, due diligence, proposal, schedule processing or other hidden fees that increase the real cost of factoring Professional customer service from a dedicated account manager

14 Get the working capital you need to grow your staffing business by working with the trusted leader in invoice factoring: Apply online at Contact us at to apply by phone or get information