Staffing companies serve a variety of industries. They may provide contract workers for government-funded projects, manage resources for call centers, or help clients who need temporary seasonal employees.
However, when it comes to financing their businesses, many staffing firms face similar challenges. For example, when they contract with clients to provide temporary or contract staff, the contract payment terms may stipulate net 15, 30, or even 60 days. Staffing companies may bill client companies once a month or even once a quarter, but they must pay the temporary or contract employees on a weekly or bi-weekly basis.
The resulting lag between paying wages and receiving the client company’s invoice payment often puts staffing companies in the position of needing working capital to close the gap and fund their operations.
Custom Financing Solutions
Traditional bank financing is often not an option for staffing companies. Banks tend to base loan approvals on tangible assets. The assets of staffing companies are their staffers and temporary employees, which are not considered a hard asset like property or a piece of heavy equipment. Staffing companies also don’t carry any type of conventional inventory that would serve as collateral for consideration for a bank loan.
At Summit Financial Resources, we understand that helping professional services firms keep their cash flow moving requires unique and flexible financing options. We offer custom products that can provide the financial support you need to sustain payroll, manage growth, and take advantage of opportunities.
Our A/R lending facility may be a viable option for your staffing company. We can provide working capital based on the value of your company’s receivables. You will have the cash on hand when you need to meet payroll, even if your client companies haven’t yet paid their invoices.
Expanding Your Cash Flow
When you need a partner to help you achieve short or long-term business goals, Summit Financial Resources can make decisions quickly and expand your cash flow without a lot of red tape. One of our clients, a large staffing company, needed funding in less than a week. This firm provides translators and other services for the U.S. government overseas. Their quarterly bonuses were due, but the company’s funding source was unable to provide the capital in time.
Summit Financial Resources was able to evaluate the situation quickly and provide an initial infusion of $1 million in just six days, a full day before funds were needed for bonus payouts. With our A/R credit facility, this firm’s employees were rewarded for their efforts and the company was able to continue its projected expansion plans.
Whether you’re the owner of a local temp staffing company or a worldwide placement firm, our ultimate goal is to help you manage your cash flow so you can navigate periods of transition and successfully grow your business.
Working Capital Financing is a few clicks away.
Summit Financial Resources specializes in working capital financing for small to medium-sized businesses that need increased cash flow. We provide working capital financing through invoice factoring, asset-based lending, inventory lending, and equipment financing.