Factoring is designed to simplify cash flow and help your business grow, but not all factoring companies live up to that promise. If your current factor is causing more headaches than solutions, it might be time to explore other options. Below are key signs that indicate it’s time to reconsider your factoring company. “Throughout the years, we have successfully helped numerous [companies] transition their accounts to Apex,” says Mike Thrasher, Apex’s Chief Sales Officer. “We hear these common complaints regularly.”
“We hear these common complaints regularly.” – Mike Thrasher, Apex’s Chief Sales Officer
1. Delays in Funding
A reliable factoring company should advance funds quickly so you can pay employees, cover operating expenses, and seize new opportunities. Slow funding disrupts cash flow and can put your business at risk. If your current factor routinely delays payments, it may be time to switch to a partner that prioritizes fast and consistent funding.
2. High Fees or Hidden Charges
Factoring fees should be transparent and predictable. Unexpected or hidden costs reduce the benefits of factoring and eat into your profits. If you’re seeing surprise fees or unclear pricing, it’s a warning sign that your factoring company may not have your best interests in mind.
3. Rigid Terms and Limited Funding Options
As your business grows, your financing needs may change. Factors that impose strict terms, limit funding options, or refuse to accommodate changing cash flow needs can hinder growth. Flexibility in advance rates, recourse vs. non-recourse options, and funding schedules are critical to your business’s success.
4. Poor Customer Support and Communication
Your factoring company should act as a true business partner, providing clear answers, timely support, and guidance when issues arise. Long response times, unanswered emails, or unresolved disputes create frustration and uncertainty. Strong communication is essential for a smooth factoring experience.
5. Strict or Inconsistent Credit Decisions
Factoring involves assessing your customers’ credit to advance funds on invoices. If your factor frequently denies funding or applies inconsistent credit standards without clear reasoning, it can block access to working capital and complicate operations. A reliable partner offers fair and transparent credit decisions.
If any of these signs sound like your current experience, it may be time to consider a factoring partner who treats you like a valued business partner, not just a number.
How The Factoring Buyout Process Works
Switching factoring companies doesn’t have to disrupt your cash flow. During a buyout, your new factor pays off the open invoices with your current factor, then takes over collections. Key steps include confirming your aging report, transferring funds, and notifying brokers and customers of the change. With the right planning, the transition is smooth and keeps your business running without interruption. “Transitioning from one factor to another can seem confusing and challenging,” says Brett Schroeder, Apex’s Sales Development Manager. “Apex focuses on clearly identifying the steps needed to make the transition and setting expectations for the carrier.”
“Apex focuses on clearly identifying the steps needed to make the transition and setting expectations for the carrier.” – Brett Schroeder, Apex’s Sales Development Manager.
What to Look for in a New Factoring Company
When searching for a new factoring partner, keep these qualities in mind to find the best factoring company for you:
- Fast, reliable funding – Same-day or next-day payment ensures your cash flow stays consistent.
- Transparent pricing – Competitive rates with no hidden fees protect your profits.
- Flexible factoring options – Recourse and non-recourse plans, multiple funding schedules, and customizable terms to fit your business needs.
- Strong customer support – Dedicated account executives who know your business and respond quickly to questions or issues.
- Easy access to information – Online account portals and mobile apps to track invoices, funding, and account activity in real time.
- Industry expertise – A factor that understands your sector and can offer advice and solutions tailored to your business.
- Additional business support – Services like TMS integrations, invoice management, back-office support, and credit checks on potential clients can save time and reduce stress.
How Apex Capital Can Help
At Apex Capital, we understand the challenges businesses face with factoring and offer solutions designed to put you back in control. Our advantages include:
- Same-day and next-day funding to keep your cash flow consistent
- Transparent, competitive rates with no hidden fees
- Flexible factoring options, including recourse and non-recourse plans
- Instant payments after invoice purchase with flexible funding methods
- Online Account Management Portal (AMP) and mobile app for easy access to invoices and reports
Ready to Explore a Better Factoring Solution?
Switching factoring companies doesn’t have to be complicated. Download our free whitepaper, How to Switch Factoring Companies, to learn the step-by-step process and what to expect during a buyout. Or, contact our team at 855-369-2739 for a free consultation and see how Apex Capital can help your business maintain healthy cash flow and grow with confidence.