According to the National Federation of Independent Business (NFIB) their Index of Small Business Optimism fell 5.4 points to 87.5. This is the third lowest reading in the 35-year history of the survey.



This low score may be in part because of today's difficult economic times, where it is difficult for a small business to get a loan from a traditional financial institution.

A financial tactic that many companies already know about is called accounts receivable factoring. This can help keep a company's cash flow going. However it is the business owners who are now using a newer factoring solution called single invoice factoring, or spot factoring, who know it is a more highly effective alternative.

Single invoice factoring, or spot factoring, is a discounting service that is simpler and superior to standard invoice factoring, receivable financing, assets based lending, or receivable funding. Customers can sell invoices to factoring companies and get immediate working capital, enabling them to ship today and get paid later.

The program allows choices of invoices to be factored, enabling the small business to retain most of their money, while spending the minimum fees to guarantee enough cash.

What has always been know as standard invoice factoring, has been around for more than 4,000 years. Why? Because many businesses do not get paid immediately for delivered products or services. Every company needs some cash to grow.

Single invoice factoring benefits businesses that do not get paid for 30, 60 or 90 days by advancing up to 90 percent against invoices.

The factoring company will take a look at the creditworthiness of your customers and can fund within as little as 24 hours without expect to buy 100 percent of your company's receivables. There are typically no minimum or maximum sales volume requirements with single invoice factoring. Each invoice purchase is a separate transaction and does not form part of a portfolio lending approach.

The transaction is modeled as a buy-sell transaction. Once the factoring company has completed its due diligence, which usually takes one to two business days, you are at liberty to offer invoices for them to buy. Once the invoices are received, the company will check the credit of the debtor named on the invoice and make sure that the sale represented has been completed. Once this is done your customer will be advised of the purchase and you will receive your funding. At the end of the credit period the debtor pays the invoice factoring company directly, thus completing the transaction.

Single invoice factoring services speeds up cash flow and increases working capital. Many companies are already benefiting from this strategy, which is certain to be a much needed resource during the holidays and into 2009.