There is a reason why accounts receivable financing is a four thousand year old financing technique: it works. Accounts receivable financing, factoring, and asset based financing all mean the same thing as related to asset based lending- invoices are sold or pledged to a third party, usually a commercial finance company (sometimes a bank) to accelerate cash flow.

In simple terms, the process follows these steps. A business sells and delivers a product or service to another business. The customer receives an invoice. The business requests funding from the financing entity and a percentage of the invoice (usually 80% to 90%) is transferred to the business by the financing entity. The customer pays the invoice directly to the financing entity. The agreed upon fees are deducted and the remainder is rebated to the business by the financing entity.

How does the customer know to pay the financing entity instead of the business they are receiving goods or services from? The legal term is called â??notificationâ?. The financing entity informs the customer in writing of the financing agreement and the customer must agree in writing to this arrangement. In general, if the customer refuses to agree in writing to pay the lender instead of the business providing the goods or services, the financing entity will decline to advance funds.

Why? The main security for the financing entity to be repaid is the creditworthiness of the customer paying the invoice. Before funds are advanced to the business there is a second step called â??verificationâ?. The finance entity verifies with the customer that the goods have been received or the services were performed satisfactorily. There being no dispute, it is reasonable for the financing entity to assume that the invoice will be paid; therefore funds are advanced. This is a general view of how the accounts receivable financing process works.

Non-notification accounts receivable financing is a type of confidential factoring where the customers are not notified of the businessâ?? financing arrangement with the financing entity. One typical situation involves a business that sells inexpensive items to thousands of customers; the cost of notification and verification is excessive compared to the risk of nonpayment by an individual customer. It simply may not make economic sense for the financing entity to have several employees contacting hundreds of customers for one financing customerâ??s transactions on a daily basis.

Non-notification factoring may require additional collateral requirements such as real estate; superior credit of the borrowing business may also be required with personal guarantees from the owners. It is more difficult to obtain non-notification factoring than the normal accounts receivable financing with notification and verification provisions.

Some businesses worry that if their customers learn that a commercial financing entity is factoring their receivables it may hurt their relationship with their customer; perhaps they may loose the customerâ??s business. What is this worry, why does it exist and is it justified?

The MSN Encarta Dictionary defines the word worry as:

â??Worry

verb (past and past participle worâ?¢ried, present participle worâ?¢ryâ?¢ing, 3rd person present singular worâ?¢ries)Definition: 1. transitive and intransitive verb be or make anxious: to feel anxious about something unpleasant that may have happened or may happen, or make somebody do this

2. transitive verb annoy somebody: to annoy somebody by making insistent demands or complaints

3. transitive verb try to bite animal: to try to wound or kill an animal by biting it

a dog suspected of worrying sheep

4. transitive verb

Same as worry at

5. intransitive verb proceed despite problems: to proceed persistently despite problems or obstacles

6. transitive verb touch something repeatedly: to touch, move, or interfere with something repeatedly

Stop worrying that button or it’ll come off.

noun (plural worâ?¢ries)Definition: 1. anxiousness: a troubled unsettled feeling

2. cause of anxiety: something that causes anxiety or concern

3. period of anxiety: a period spent feeling anxious or concerned��

The opposite is:

�not to worry used to tell somebody that something is not important and need not be a cause of concern (informal)

Not to worry. We’ll do better next time.

no worries U.K. Australia New Zealand used to say that something is no trouble or is not worth mentioning (informal)�.

Query: if a business is financing their invoices with accounts receivable financing, is this an indication of financial strength or weakness? Query: from the point of view of the customer, if you are buying goods or services from a business that is factoring their receivables, should you be concerned? Query: is there one answer to these questions that fits all situations?

The answer is itâ??s a paradox. A paradox is a statement, proposition, or situation that seems to be absurd or contradictory, but in fact is or may be true.

Accounts receivable financing is both a sign of weakness with regard to cash flow and a sign of strength with respect to cash flow. It is a weakness because, prior to financing, funds are not available to provide cash flow to pay for materials, salaries, etc. and it is an indication of strength because, subsequent to funding cash is available to facilitate a businessâ?? needs for cash to grow. It is a paradox. When properly structured as a financing tool for growth at a reasonable cost, it is a beneficial solution to cash flow shortages.

If your entire business depended on one supplier, and you were notified that your supplier was factoring their receivables, you might have a justifiable concern. If your only supplier went out of business, your business could be severely compromised. But this is also true whether or not the supplier is utilizing accounts receivable financing. Itâ??s a paradox. This involves matters of perception, ego and character of the personalities in charge of the business and the supplier.

Every day, every month thousands of customers accept millions of dollars of goods and services in contracts that involve notification, verification and the factoring of receivables. For most customers, â??notificationâ? of accounts receivable financing is a non-issue: it is merely a change of the name or addresses of the payee on a check. This is a job for a person in the accounts payable department to make a minor clerical change. It is a mainstream business practice.

Bobby McFerrin wrote and performed a song called â??Donâ??t Worry, Be Happyâ? for the movie â??Cocktailsâ? starring Tom Cruise. The song was a number one U.S. pop hit in 1988 and won the Grammy for Best Song of the Year. Here are the lyrics:

�Here is a little song I wrote

You might want to sing it note for note

Don’t worry be happy

In every life we have some trouble

When you worry you make it double

Don’t worry, be happy……

Ain’t got no place to lay your head

Somebody came and took your bed

Don’t worry, be happy

The land lord say your rent is late

He may have to litigate

Don’t worry, be happy

Look at me I am happy

Don’t worry, be happy

Here I give you my phone number

When you worry call me

I make you happy

Don’t worry, be happy

Ain’t got no cash, ain’t got no style

Ain’t got not girl to make you smile

But don’t worry be happy

Cause when you worry

Your face will frown

And that will bring everybody down

So don’t worry, be happy (now)…..

There is this little song I wrote

I hope you learn it note for note

Like good little children

Don’t worry, be happy

Listen to what I say

In your life expect some trouble

But when you worry

You make it double

Don’t worry, be happy……

Don’t worry don’t do it, be happy

Put a smile on your face

Don’t bring everybody down like this

Don’t worry, it will soon past

Whatever it is

Don’t worry, be happyâ?

The bottom line: â??notificationâ? should not be an issue in most situations involving accounts receivable financing; non-notification factoring is another option that is available for businesses concerned with confidentiality that meet minimum credit standards for asset based lending. Bobby McFerrin was right: â??Donâ??t Worry, Be Happyâ?.

Copyright © 2007 Gregg Financial Services

www.greggfinancialservices.com

Whether you are starting an import business or have an established importing business, it can be a very profitable venture if you have the right financing to grow your business. Imports are defined as: a good that crosses into a country, across its border, for commercial purposes; a product, which might be a service that is provided to domestic residents by a foreign producer; or a combination of the two.

Starting or running an import business has never been more profitable because of computers, the internet, and the availability of low cost imports from countries such as China and Mexico. These imports may be resold for up to ten times their cost depending on the competition in your field of operations.

It is essential that you have good, honest suppliers plus creditworthy customers with purchase orders for your imports. If you have the right financing, your business can grow exponentially. But how do you finance growth if your own resources or bank lines of credit are not sufficient to take advantage of big opportunities? A combination of purchase order financing, accounts receivable financing with inventory financing may be the solution.

Definitions:

Purchase Order Financing

Purchase Order financing is the assignment of purchase orders to a third party, a commercial finance company, who then assumes the obligation of billing and collecting. Purchase order financing can be used to finance all current and subsequent orders to improve your company’s cash flow. The process works as follows: 1) Your company obtains a purchase order for products to be sold another company; 2) A letter of credit may be issued, based on a finance companies’ credit, to guarantee payment to suppliers or factories producing the goods; 3) The order is shipped, delivered and accepted by your customer; 4) The customer receives an invoice for the goods; 5) The Purchase Order Company pays the supplier/factory; 6) a commercial finance company or Accounts Receivable Finance Company pays the Purchase Order Financing Company after the products are delivered to your customer; 7) The customer pays the commercial finance company for goods received; The accounts are settled and the profit is paid to you.

Accounts Receivable Financing

Accounts Receivable Financing is the selling or pledging of your company’s account receivable, at a discount, to a Factor, a Commercial Finance Company or to an Accounts Receivable Financing Company who may assume a risk of loss. You receive a portion, usually 80% to 90% of the face value of your receivables in advance of payment from your customers in return for a fee, or interest, to be paid to the commercial finance company. When the commercial finance company is paid by the customer, the appropriate fees are deducted and the remainder is rebated to you. “Accounts receivable financing” is also called accounts receivable factoring, factoring financial services, invoice factoring and cash flow factoring. The terms are used to convey the same meaning.

Inventory Financing

Inventory financing is a loan secured by the inventory of your business. Inventory finance enables import companies to hold more stock without cash flow strain and to generate more sales. Inventory finance is often part of a Purchase Order and Accounts Receivable Financing commercial finance package.

These three types of financing can enable an import business to increase purchasing capabilities dramatically; you can accept larger orders and grow your business exponentially. You can use your inventory to leverage your purchasing power. You can use your customer’s credit to obtain these three types of financing; and you can use the commercial finance company’s credit to obtain a letter of credit.

The concept of financing your import company with “other people’s money” is part of a safe and sound business plan. Add strong product quality controls, inventory controls, and good accounting to maximize the success of your import company.

Copyright © 2007 Gregg Financial Services

www. greggfinancialservices. com

If you are going through some rough times, bad debt seems to pile up faster than you can make money. During these trying times, life becomes incredibly stressful. But there are ways out of every impossible situation and getting out of bad debt is no exception. Through abiding by several tips, even the worst of debt can be subsided with a little valor and effort.

Several Basic Tips to Debt Relief

The first thing one should do when faced with debt is to think of repayment plans. If you haven’t contacted the company associated with the debt, be sure to do so and discuss possible payment plans. This will allow yourself time to get the money, while still have cash flow for necessities.

The above tip will also help avoid borrowing money to pay bills. Borrowing money will only worsen your situation, since the money will have to be paid back with interest. This method should be avoided at all costs. In some cases, a family member or close friend will be able to act as a bank, and allow money to be borrowed with a little friendlier term on interest rates.

Although housing is a necessity, it is important to not go overboard. Generally, housing situations should not cost more than 30% of your monthly income if it can be helped. The luxury of a nice apartment is nice to have, but there is no sense in living like a king when there are bills to be paid.

Controlling Spending, Maximizing Earnings

To pay debt off, it’s logical to think that you should be earning more money than you spend. This logical thinking is exactly right! Make sure that all unnecessary expenses are cut. Always seek to take the cheaper way out wherever possible.

Cutting out unnecessary expenses can save a lot of money and turn bad debt into a hopeful situation. To make the process minimize further, another job could be taken to maximize earnings. This way your expenses are cut and your profits are maximized. If this kind of plan is followed, bad debt will only be temporary.

Strategic Repayment Plans

If you owe money to several different sources, always put the high interest debt as your priority. Over time this will end up saving a good deal of money for anyone with bad debt. Since high interest will always cost more money than low interest, this is logically the best solution.

Debt can also be consolidated- meaning that all of your debts will be consolidated into one monthly payment. This requires the help of special agencies and businesses most times- but it is well worth the effort. Instead of stressfully remembering who you owe money and when it needs to be paid, you only need to look forward to one monthly payment. This also helps you budget your expenses with much more ease.

Final Thoughts on Bad Debt Situations

Bad debt isn’t always impossible to get out of. Following the above tips will ensure that bad debt is a temporary stressor not long term. Of course this depends on the level of debt- but with the right budget all that is needed is time and a little effort.

Also be sure to look into debt consolidation. We all know how stressful debt can be- and the phone calls from multiple companies never helps. Keep your head up high and your nose to the grindstone, and the bad debt will be gone for good.Commercial Collections help and Debt Collections advice.

A number of common traps keep the middle-class from maximizing their money-making potentials and succeeding in wealth creation. Among the most common wealth creation trap of the middle class is the “appearance of money”.

What Is the Appearance Of Money?

The appearance of money, as might already have been guessed, is simply the need to buy and to have so that one looks like he or she (or they) have money. It grows out of the need to keep up with the neighbors, to be accepted, to live the way and have the things that they feel society says they should.

It is easy for the middle class to have the appearance of having money. Easy credit, bank loans, mortgages, car and automobile loans, all are designed to give the middle class the appearance they need; and to indebt the middle class to the banking institutions in the meanwhile. By playing on the psychology of the middle class, the banks create an everlasting cash flow for themselves. A cash flow that, although the middle class willing subjects themselves to, is at the expense of the middle class, at the expense of the middle class’s financial success.

As long as the focus of life is on appearing wealthy, the focus is not appropriately placed on making money. But the only real way to be wealthy is to make money, create wealth, and achieve lasting financial success.

Don’t The Wealthy Present The Appearance Of Money, Too?

It is a fallacy myth, that the rich struggle to keep up and appear wealthy. The wealthy present the appearance of money because they actually have money. It is not an appearance, it is their reality!

The reason that the wealthy have money is because they have properly placed their priorities. The wealthy shun status and focus on the real goal, financial freedom, and work to achieve it. Once they have, the wealthy are able to buy what they want and live the life they want to because they have the financial backing to do so.

The real difference between those who succeed in wealth creation and those who fail is based in a very large part in the goals set in the beginning.

- The middle class (referring to those unable to move beyond a work-for-pay lifestyle) focus on getting and having things.

- The wealthy focus on having money so that they can have things.

As Jamie McIntyre if the 21st Century Academy says, “Many people get caught up in appearing to be wealthy, instead of becoming wealthy.” It is an unfortunate truth, but not one that is without hope of changing.

Just as appearing to be wealthy is a mindset a psychology, so, too, is being wealthy. The choice can just as easily be made to really be wealthy as it can be to look wealthy. Making that choice, and re-prioritizing, is one of the first critical steps towards wealth creation and towards really financing the life of the wealthy.Sean Rasmussen is a stock market and property investor. He likes topics about communication and success. His wealth creation blog deals with topics of financial freedom and creating wealth.

Recovering from addiction is a long struggle, one that extends beyond a body free from substances. Recovery is a healing process that reaches out to your relationships, your mental health, you career and even your finances.

Achieving permanent sobriety means rebuilding your life after addiction and creating a foundation upon which you can steadily stand. To do that, many people recovering from addiction need to rebuild their finances. If you’re on the path to recovery, keep reading to learn how to take charge of your finances, budget for an abundant life and rebuild your credit.

Many people coming out of addiction are faced with depleted savings, health bills, repossessed goods, bad credit or even bankruptcy. Before the stress of these financial burdens affects your path to recovery, you need to face your financial problems head on.

First, learn to budget your money without going further into debt. Start by calculate your total family income from all sources. From there, calculate all of your expenses including rent, house payments, utility costs, groceries, debt repayments, savings and entertainment. If, after budgeting, you’re unable to balance your incoming cash flow with your outgoing cash flow, then you need to start making cuts.

Whether your cuts as small as removing your cable service or as big as downgrading your apartment or home – sometimes we need to cut back in order to build back up. Remember, you can also renegotiate your credit agreements and set up payment schedules as a way to reduce your monthly payments and begin tackling your debt both responsibly and in way that’s affordable.

Second, be prepared to rebuild your credit. This starts with a plan. Focus on how you’re going to attack your debts, make a commitment to never miss a payment and plan out how you’re going to use your future borrowing ability.

If you’ve had to declare bankruptcy, start rebuilding by reopening a checking or savings account. You can then rebuild your finances by always making your bankruptcy payments on time, applying for and maintaining a secured credit card, staying away from payday loans or other high interest traps and always being diligent with your payments.

It’s a long and hard road to rebuilding your finances, but over time you’ll get there. The first year is the hardest, but once you’ve proven that you can responsibly manage your finances for a 12-24 month period, you’ll see your credit score improve exponentially. With time, you’ll be back in a position where you can apply for a home mortgage, obtain a credit card or secure a car loan.Please visit What Is A Womens’ Retreat? and Self Esteem Building