Advantages of Payroll Funding to a Staffing Agency
When in need of financing for your staffing agency, look for a payroll loan because it is available for all businesses but only if the borrower’s accounts receivables have enough value that can be used as collateral for the loan. The company does not take the money that the customers owe it but allows the lender to take the money as a loan payment. Here are the advantages of payroll funding to a staffing agency.
Clients are allowed to negotiate for an affordable interest rate and payment plan that will enable them to pay the loans without straining. A payroll loan will leave a debt balance sheet because liabilities and assets balance each other. The payroll funding (liability) is balanced by the accounts receivables (asset/collateral) hence your staffing agency if not in debt.
You can pay payroll taxes and other debts in the company using payroll funding. There are many consequences of not paying your payroll taxes such as penalties, suspension or revocation of your business license, the authorities will monitor every step you make more keenly and so on. Lenders can liquidate the assets that you pledged as collateral if you default the loans. You can get a payroll loan to finance another loan because lenders of payroll loans do not follow up to know how you sued the money as long as you can repay the loan.
If you need more working capital get a payroll loan because it will increase cash flow in the staffing agency. Avoid using the agency’s savings or profits for daily expenses during the low season by using a payroll loan to invest in your business. The lender does not take the entire amount that the customer pays but a percentage of it and sends the rest to you. You will be able to pay the payroll loan during peak season, therefore, avoid using the agency’s income unnecessarily when there are alternatives.
Workers are laid off temporarily or permanently, forced to take compulsory pay cuts or salaries are delayed when the company is financially low. The funding increases the rate of job security for the employees thus improving the level of job satisfaction among them. Paying employees on time does not only affect their satisfaction level at work positively but also increases their level of productivity.
Your staffing agency needs enough finances for it to hire employees who have highly sought after qualifications by employers. Experienced and skilled employees bargain for a higher pay rate because they are confident that they add value to the employer. Your agency will get more companies demanding for more employees from you because of your ability to hire the people with the best qualifications.