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Factoring Distributors in Canada

Why Choose Us? Accounts Receivable Financing is our Business
  • Financing Rates at 0.69% - 1.59%
  • No Financials - No monthly minimums - No invoice minimums
  • No facility fees - No audits - No up-front fees - No hidden fees
  • Set up account in 3 to 5 working days - 24 hr funding thereafter
  • Credit Lines starting at £5,000 & up to 10 million
  • Optional Libor & Admin fee
  • Customer referrals upon your request
  • We Make Same Day Decisions
Over 15 years in business
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1st Commercial Credit has been part of the Canadian distribution industry for a very long time. We are a premier finance organization that has spent a lot of time working with a variety of distributors that handle a lot of different products. The distribution business is very different than any other kind of industry in Canada, and it takes a special kind of funding company to meet the ongoing needs of a dynamic distribution organization. 1st Commercial Credit has the flexible plans that you need to meet all of your distribution finance goals and we can show you how much easier your job will be when you have adequate cash flow.

1st Commercial Credit understands that the key element to the distribution industry is flow. The products have to continuously flow from the manufacturers to the distributors, and then that product flow has to be maintained from the distributors to the retailers. The ultimate goal is to create a healthy flow of products into the hands of paying end users and that requires a persistent undercurrent of cash. 1st Commercial Credit knows that the job of financing distributors falls on the distributors themselves. The manufacturers expect distributors to continue to purchase products and the retailers rely on wholesale companies to keep supplies updated. It is a fluid process, but it is not an easy one to maintain.

Factoring Distributors Is What 1st Commercial Credit Has Been Doing For Years

Invoice factoring has been something that 1st Commercial Credit has been doing for Canadian distributors for years. The reason factoring is so effective is that it promotes corporate growth in several ways. First of all, when a company is allowed to use its own financial resources to pay bills, then there is an organic growth that is spurred within the organization. Employees get excited about the idea that the company is standing on its own two feet and that motivates sales professionals to sell more and drive more revenue for the organization.

The other positive effect of factoring on distributors is that it keeps debt off the company's bottom line. Canadian distribution companies require cash on an ongoing basis to achieve their goals and meet customer needs. But utilizing bank funding simply adds debt to the bottom line that can weigh the company down. With factoring, the company has a cash flow that is sustained by its own invoiced sales and that is how it funds its operations. When there is not need to bring in bank funding to meet payroll or pay vendor bills, then the distributor is going to be in a stronger financial position.

1st Commercial Credit Understands The Two-Sided Pressure That Canadian Distribution Companies Feel

What does it mean when we say that we can relieve a distributor's sense of two-sided pressure that is felt every day? 1st Commercial Credit has been an expert in the distribution industry for many years and we know what kinds of pressures manufacturers put on distributors. In order to maintain its price level, a wholesaler has to continue to purchase products on a consistent basis. The manufacturer assumes that then distributor is selling these products on through the channel. As far as the manufacturer is concerned, it is the up to the distributor to buy products and sell them. If the distributor slows down the pace at which it buys product, the price will go up and that affects the bottom line.

The other side of the pressure equation for distributors comes from retailers. In most industries, there are several major distributors that sell the same products to retailers. If a retailer does not feel like he is getting a good deal from one distributor, then he will simply move his business to another wholesaler. Most retailers have relationships with each of the large wholesalers in an industry, which creates a significant amount of pressure for the wholesalers. If they want to be able to sell the volume of products they need to sell to maintain their profit margin, then they need to keep their client base intact. This two-sided pressure equation is very unique in the business world.

1st Commercial Credit Has The Distribution Finance Model That Keeps Distributors Strong

What is the key to not just surviving, but thriving in this two-sided pressure model? 1st Commercial Credit knows that the key to success in distribution is cash flow. A wholesaler needs cash on hand at all times to be able to make the purchases it needs from manufacturers and keep its own prices down to retailers. The problem that arises when those retailers allow their invoices to go past due and the cash flow for the distributor is affected. In an ideal situation, the cash flow would be the rough equivalent of the invoiced sales. But in the real world, the actual flow of money into the company is considerably smaller than what the company takes in for revenue.

Eventually, the distributor will get all of its cash from its invoiced sales. But when that cash comes 30, 60 and 90 past the invoice due dates, then it is impossible to rely on that cash to pay corporate bills. That is where 1st Commercial Credit comes in. We step into the middle of the equation and allow your distribution company to create a cash flow situation it can rely on. We make sure that you get the cash from your invoices on or before the invoice due dates and we can also turn around past due invoices within 24 hours of invoice approval. Instead of feeling pressure from both sides of the equation to keep the flow of product moving, a distributor has the cash it needs to meet challenges and continue to grow. Thanks to 1st Commercial Credit's invoice factoring programs, Canadian distributors have that financial option they need to turn the pressures of the wholesale business into a long list of economic opportunities.

The Cash For Distribution Finance Comes From Your Receivables

It needs to be understood immediately that 1st Commercial Credit is not a bank. When we help Canadian wholesalers to improve their cash position, we are not adding more money to their corporate debt, like a bank would. We do not deal in traditional loan products that would offer you money in a situation where you would not be able to immediately pay it back. When you think about it, all you really want is the cash that your company has already earned. All you really want is to be able to run your company with the proceeds from your invoiced sales. A bank loan does not offer you that chance, but invoice factoring through 1st Commercial Credit does.

We will work with you to turn your aging report into more of an indicator as to the strength of your cash position. We will use your company's receivables to generate the cash flow that you need and the cash flow that you have earned. Our process utilizes your outstanding invoices as collateral for loans that are based solely on the money you have already earned. We cut out the wait that goes with past due invoices and bring you the cash you need on or before the invoice due dates. The best part is that we never loan you more than you have earned, which means that the invoice factoring process through 1st Commercial Credit will never add to your company's debt. The work we do is based on the work that you have already done.

A Strong Cash Flow Gives A Distributor An Advantage

In the distribution industry, there are several business elements that can offer your company a distinct advantage. The first is a solid relationship with the biggest manufacturers in your industry. When you are a top distributor for the best manufacturers, then you can command a large segment of the market. Another element that benefits a wholesaler is having fluid arrangements with top retailers. Many retailers cross industries, which can be a problem for some distributors. For example, a large department store chain may sell computer printers and furniture. Those products come from two completely different industries, which means that there are two different networks of distributors involved.

When it comes right down to it, the thing that allows a distributor to take advantage of these relationships is strong cash flow. A manufacturer is only as benevolent as a distributor's last order. In order for the distributor to maintain his strong status with a manufacturer, he must meet purchasing quotas or that relationship will change. Large retailers want low wholesale prices and it takes strong cash flow for a wholesaler to be able to offer the kinds of prices large retailers want. The key is to turn those invoiced sales from the retailers into cash as soon as possible and use that cash to purchase more product from the manufacturers. As long as the cash flow is there, these relationships stay intact.

Invoice Factoring Improves A Canadian Distributor's Relationship With His Retailers

1st Commercial Credit knows that profit margins for distributors are razor thin. A large invoice generated to a retailer must be paid on time for the distributor to see any profit at all. The longer that an invoice goes past due, the closer that invoice gets to being a loss. If too many retailer invoices go into the loss column, then that starts to create financial issues that the distributor may not be able to recover from. Invoice factoring through 1st Commercial Credit solves that problem by eliminating past due invoices and strengthening the relationships that you have with your biggest retailers.

1st Commercial Credit can have your invoice factoring account set up within five business days of receiving your completed application online. Once we get your account operational, we are able to advance you funds on past due invoices within 24 hours. So if you have a pile of past due invoices that mean the difference between making payroll or having to crawl to the bank, then contact us right now and we will work with you to turn that stack of past due invoices into cash. You will be able to stand on your own two feet and finance your operations on your own. When you avoid bringing new debt into your company books, you pave the way for those growth projects that you have been thinking of doing for years.

Receivables Funding Through 1st Commercial Credit Takes The Pressure Off Your Business

Because distributors throughout Canada have such a thin profit margin, there is always pressure to maintain their corporate credit rating. Bills must be paid on time or else the credit rating will plummet. But when you are dealing with past due invoices and a single-digit profit margin, it is not always easy to meet those obligations with your own resources. Sometimes a distributor has to take the step of tying up even more financial resources into paying off the compounding interest associated with bank funding and that creates even more stress. If you don't make those loan payments that you took on to preserve your credit and run your business, then your credit suffers. It almost isn't fair.

Accounts receivable funding from 1st Commercial Credit removes all of that pressure in several different ways. First of all, we don't care about your company credit score. We are much more interested in leveraging the combined credit power of your customer base in your favor than we are in checking out your credit profile. When we put together a receivables financing plan for you, it will provide you with the foundation you need for a reliable business line of credit. You can make your own payroll deposits and pay your vendor bills without having to get involved in bank funding. We give you the freedom to run your business as you would want to and not as a bank would tell you to.

Canadian Distribution Factoring Means That It Is Time To Think About Expanding

Every distribution company in Canada has that one manufacturer or manufacturer sales program that will change everything. Landing that big deal with a big manufacturer would finally give you a good reason to build more logistics centers and expand your business well beyond what it is right now. But when your manufacturers see your receivables, they are not convinced that you have the financial strength to move up to that next level. Past due invoices are preventing your business from showing the kind of economic mobility that impresses large manufacturers and opens doors of opportunity for your business.

Invoice factoring solves those problems, strengthens your economic foundation and gives you the confidence you need to attain those next level goals. When your manufacturers see the strength of your company's cash flow, they will see why your distribution organization deserves the larger contracts. You will have the financial stability to be able to move more products and increase revenue. This will also allow you to take on smaller retailers who will help to increase your company's profit margin. But it all begins with a strong cash flow and that is where invoice factoring can help.

Expand Your Canadian Distribution Network With Invoice Funding

There are many reasons why proactive Canadian distributors work so hard to add more logistics centers to their network. For one thing, more logistics centers means that the products are closer to retailers and that saves money on shipping costs. Many Canadian wholesalers like to create specialized satellite locations that do more than just process and move product. Some wholesalers offer repair, integration and training services to wholesalers and these additional locations helps to make those services both accessible and economical. The ultimate goal of every distributor is to be able to add more locations and do more for retailers.

The other upside to more locations is it looks more impressive to the larger manufacturers. A Canadian wholesaler who keeps adding more logistics locations to their network has much more to offer the larger manufacturers that want maximum product exposure. When your distribution company is bogged down paying off bank borrowing debts, it is impossible to execute any expansion plans with any kind of confidence. But when you have invoice factoring on your side, you are able to sustain operations without bank borrowing and that opens up the doors of opportunity for the future. When you make plans to open a new logistics location, you can make those plans based on your company's own cash flow and not the need for expensive bank funding.

The Ongoing Costs Of Running A Canadian Distributor Business Are Significant

Canadian wholesalers have a wide range of costs that have to be attended to each and every day. Some distributors have their own fleet of trucks, while others utilize international shipping organizations. Most distributors use a combination of their own trucks and a shipping service, and both create costs on a daily basis. There are also the costs associated with the packing materials used to get products safely to the retailers and the marketing that goes along with expanding that retailer network. Sometimes manufacturers offer marketing funds, but often those funds are not enough to really address the issue of expanding the distributor's web of retailers.

Along with all of these recurring costs, the distributor also has to worry about making payroll and keeping manufacturers happy. While the retailers may be able to pay their invoices to the distributor late, the distributor does not have that luxury with its manufacturers. A healthy cash position is essential for not only the success of a distributor, but the company's very survival depends on turning outstanding invoices into cash as quickly as possible. With an invoice factoring program administered by 1st Commercial Credit, your wholesale business will have the cash it needs to meet all of its ongoing economic demands.

Give Your Distributor Business The Advantage It Needs With 1st Commercial Credit

Up to this point, you have probably been telling yourself that you have your company finances under control and everything is just fine. If that was really the case, then you would not still be reading this page. It is extremely common for a Canadian distributor to find itself in financial trouble on a regular basis. The thin profit margins and unpredictable payment habits of clients make financial challenges part of the industry. But it doesn't need to be that way. If you are still reading this, then you are looking for answers to help your distributorship to become more profitable and expand. 1st Commercial Credit is the answer that you have been looking for.

Our solution is so simple that it can only be described as common sense. We step into your business process and allow you to benefit from the invoiced sales that you have worked so hard to generate. It does not get any more complicated than that. Your sales professionals work every day to create the revenue that makes your company run, but past due invoices make it almost impossible for you to avoid the clutches of bank borrowing. When you get 1st Commercial Credit involved in your business process, the need for bank borrowing slowly disappears. As your invoiced sales grow, so will your business line of credit. We have the services you need to push your business to that next level and open those new logistics locations.

We always have financial experts standing by to answer any of your questions, but we encourage you to start the process with our online application. Stop wondering how you can make your distributor business more successful and start taking action. The Canadian distribution industry is a dynamic business world that is driven by strong cash flow. If you want to be a major player, then you need to take the steps necessary to improve your cash position. 1st Commercial Credit has the flexible plans you need to enhance your financial strength and move your distributorship to the next level.

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Receivable Financing Rates

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  • No Financials up to $350k
  • Easy Set-Up in 3 to 5 Days
  • Over 15 years in business
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