Considering Finances as a Staffing Firm

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How is Payroll Funding Different Than a Loan?

And What Difference Does It Make to Your Business?

Are you a staffing startup looking for financing? Or are you looking to expand your business offerings? Or, as a savvy business owner, just contemplating different financial opportunities?

If any of these scenarios are the case, as a staffing firm, have you ever tried to explain your business model to a bank? The result can be a little disheartening, to the say the least. There can be a disconnect, and you as a growing firm or startup literally can’t afford it. The importance of cash flow to a staffing firm is central to its success.

Why Funding Over Banks?

To put it in a nutshell, there is a long history of banking not really “getting” the staffing concept, and this stigma (or perception) continues today. If you’ve been in staffing for some time, you will have experienced this; if you’re a newcomer and/or a promising startup, you’ll find it out soon enough.

One of the reasons for this is that banks traditionally like to have hard assets when they make a loan. As a staffing firm, your main assets are your people. Add to that the cyclical nature of the staffing business – and that the more you grow, the more money you need – and banks are reluctant to do business with you, or, no matter how well-meaning, can misunderstand your business model. Fortunately, that’s where funding services such as Madison come in.

Benefits of Payroll Funding

The best argument for using a payroll funding service is that they are more flexible than bank loans. This is due to the process being quicker, and not involving years worth of financial statements that banks demand. This fact alone makes it hard for staffing startups to get the money they need to move quickly. Funding allows startups to get financing in an easier, more efficient way.

Speaking of startups, if you are someone with enough capital to launch a business, congratulations. But many times business cycles change and you can be caught off guard.

Payroll funding can be a great alternative to borrowing money. It not only provides an instant cash flow, but it allows you to close the gap between payroll and client payments. This also avoids the headache of worrying about a client’s late payment (particularly if it’s a client you want to keep).

But perhaps more importantly, there’s nothing worse than missing an opportunity because of a lack of cash. For more than 25 years, Madison Resources has provided payroll funding for staffing companies. From helping startup firms get off the ground to giving staffing companies the support they need to grow with confidence, we improve cash flow and profitability by offering quick access to capital.

Financial support can be crucial to helping you grow; indeed, it’s not exaggerating to say that it can be the single deciding factor between success and failure.

You may decide it’s time to open a new location, or bring on extra internal staff or candidates. Additional funding can allow you the breathing room you need to achieve your business or growth objectives. But did you know that some funding partners offer more than just funding assistance?

Added Value

Payroll funding companies devoted to staffing are able to customize their services to your needs. For example, at Madison we offer  a full-service payroll funding option.

With the full-service option you get our suite of back office services. This means payroll processing, billing, credit and collections, cash application and payroll tax filing, all wrapped up in one simple, integrated solution.

But in case you already have your back office operations in place, our funding-only option offers access to the capital you need to improve your cash flow. Let us help you assess the best option for your business.

Because that’s another benefit … advice. We’ve made firms successful over many years and we can help you assess your business and plan how to grow. Contact us today.