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Philmark Solutions
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Can Spot Factoring improve profitability?
Company ABC has a new opportunity with a reputable, well-recognized company. Taking on this new client could potentially double their annual sales volume. Unfortunately, ABC has reached their credit limit and had not paid their last quarter Revenue Canada remittance. As a result ABC's bank turned down their request for additional financing.
ABC is referred to Philmark. They fill out a two-page application and fax it back together with their most recent financial statements and a copy of their current A/R. Within two business days, Philmark agrees to purchase $50,000.00 of their current invoices. Philmark agrees to advance $45,000.00 (90 %) of this amount. Total cost is anticipated to be 4.0%. The remaining 10% balance less the factoring costs is received shortly after the invoices are paid 30 days later.
Factoring - to increase profitability
See how this Profit and Loss Statement shows how spot factoring can increase a company's capability for expansion and profitability.
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Without Spot Factoring
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With Spot Factoring
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| Sales |
$ 300,000  |
$ 600,000 |
| Cost of Goods Sold |
$ 100,000 |
$ 200,000 |
| Fixed Costs |
$ 50,000 |
$ 50,000 |
| Variable Costs |
$ 60,000 |
$ 120,000 |
| Spot Factoring Costs |
$ - |
$ 24,000 |
| Net Profit $ |
$ 90,000
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$ 206,000
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| Net Profit % |
30.0% |
34.3% |
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Seize the opportunity - get the cash you need
Company ABC is able to double their sales volume due to having the cash needed to seize the opportunity.
Although not obligated to do so ABC decides to continue to factor this new account for the balance of the year. New invoices are faxed to Philmark and after notification and verification procedures, ABC receives a cheque within 24hours.
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CLICK TO GET:
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Factoring Application form
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Business Consent form
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Philmark Privacy Policy
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Philmark brochure
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