Do you want to start a factoring business by buying a franchise? If YES, here are 10 best invoice factoring franchise opportunities for sale and their cost.
Factoring happens when a business sells the outstanding accounts receivable it has to a third party at a discounted price. This usually involves accounts that are very hard for the business to collect. The business selling their AR make at least a little cash on something that might normally be written off as bad debt. Factoring businesses can collect the payments that are owed and make a profit from commissions earned, interest expenses, and fees that are paid.
Unless you’ve already been active as a direct funding agent, it is usually advisable to become a factoring broker or agent first. There’s bigger money in funding deals, but you can still make profits by working with the invoices or handling the advances. You will also want to begin within an industry where you have a high degree of familiarity. This will help you make some cash while you learn the ropes.
Also, if you will prefer to start small with your factoring business, then doing the work part-time can help you to become familiar with the process. This is not usually an option if you’re going the direct funding route. You will be getting a number of calls after hours to track down invoices, so plan on nights and weekends being dedicated to your new business venture.
Have it in mind that when it comes to accounts that go overdue, the healthcare industry has more than its fair share of accounts. Your services are going to be greatly appreciated here. Volunteering to speak about factoring, hosting seminars, or even having free webinars for clients are all additional proven ways to expand your outreach.
Also note that in some jurisdictions, your business may need to be licensed as a collections agency. You may also need to be licensed as a financial institution. There may be specific certifications that are required to obtain this license as well. You will need to be prepared for a general business license, a collection agency license, and other local authorizations.
You will also need to perform your due diligence on every account and invoice that you are considering. Collect as much data as possible on the invoices that you’re considering and determine how collectible that debt might be. Avoid high risk debts whenever possible to make sure that your profit margins are consistent.
Factoring is one of the few business opportunities where the rule of high risk, high reward doesn’t usually apply. A factoring business may not be right for everyone, but for those who love the financial sector, it could be an outstanding business opportunity. Below are a few industry franchises to consider in the United States.
10 Best Invoice Factoring Franchise Opportunities for Sale and Their Cost
- Tenet Financial Group
This company is dedicated to helping business owners navigate the entire funding process and helping established clients collect outstanding debts. From franchising to recapitalization, the firm gets you funded quickly and securely so you can focus on your business. Tenet Financial Group is not a sales company.
They provide a very high level of customer service to ensure that the design, installation and administration of your new plan is done correctly. A variety of funding streams are available for today’s prospective business owner. From self-directed 401(k) plans to SBA loans, Tenet is there from day one through the life of your business so you can focus on doing the work you love.
- Initial Investment: $40,000
- Net-worth Requirement: $40,000
- Liquid Cash Requirement: $40,000
- Total Investment: $40,000 – $40,000
- Liquid Capital Corp.
Liquid Capital is the world’s first factored lending/financing franchise. Franchisees help their clients succeed by providing on – demand financing. Liquid Capital franchisees are home-based and supported by a strong corporate infrastructure and back-office administrative support system.
Liquid Capital Corp. is an international network of Franchise Principals who provide a specialized financial service centered on the core business of Factoring. Sometimes referred to as Accounts Receivable Funding, Liquid Capital Principals purchase credit approved invoices from clients and advances immediate cash, typically 75% – 80% of the invoice.
- Liquid Cash Requirement: $75,000
- Net worth requirement: $200,000
- Total Investment: $200,000 – $200,000
- Franchise fee: $50,000
- Interface Financial Group
IFG has been in the invoice discounting business since 1972, and is a market leader providing an alternative funding source for businesses with its in – demand financial service. With over 40 years’ experience in the business, Interface provides franchisees with a proven system, thorough training, a comprehensive risk management program, a state of the art operations platform, and a management support team with over 400 years of combined relevant financial service experience.
- Initial Investment: $86,800 – $137,800
- Net-Worth Requirement: $150,000
- Liquid Cash Requirement: $75,000
- Total Investment: $86,800 – $137,800
- United Check Cashing®
Established in 1977 and franchising since 1992, United Check Cashing® is a pioneer in the check-cashing industry. United check cashing provides a variety of vital financial services for consumers who prefer to manage their money on a simple cash basis.
United provides check cashing services, debt collection, money orders, wire transfer, bill payment, prepaid debit cards and much more! United offers fast and convenient services that are available to everyone.
- Initial Investment: $226,000
- Net-Worth Requirement: $350,000
- Liquid Cash Requirement: $120,000
- ProfitPlus Accounts
Due to a new marketplace offering, this is a substantial opportunity for you to grow your franchise, and be part of the global growth of ProfitPlus Accounts. You can get intimately involved in the development of ProfitPlus Accounts, and build this business to be the number 1 business services firm in the world. You can get involved as the owner of a single operated Franchise, a multiple territory Franchise or Master Franchisee of a state or country… it really is up to you.
- Initial Investment: $30,000 – $250,000
- Liquid Cash Requirement: $25,000
- Total Investment: $30,000 – $250,000
TaxLeaf has been helping people with their Tax, Accounting and debt collection needs since 1976. TaxLeaf is a Tax and Accounting Franchise model like no other. Unlike other major competitors, TaxLeaf specializes in business accounting, debt collection and tax preparation services.
Small-to-Medium Sized businesses (SMB) make up 99 percent of all businesses in the USA. SMB owners spend an average of 4 hours per week on their accounting. This is too good an opportunity to pass up.
- Initial Investment: $40,000
- Liquid Cash Requirement: $35,000
- Total Investment: $40,000 – $65,000
- Expense Reduction Coaching
In today’s competitive environment, reducing overhead and costs are as important as increasing sales. Expense Reduction Coaching targets indirect and consumable expense categories. Then they zero-in on the most common profit leaks, showing you how to eliminate them. This could include negotiating more beneficial terms and pricing with existing suppliers and/or finding equally capable alternative sources.
- Initial Investment: $66,000
- Net-worth Requirement: $199,000
- Liquid Cash Requirement: $66,000
- Total Investment: $66,000 – $74,250
- RMH Business Solutions, Inc.
Robert Hackl has experienced a long and successful career in accounting and financial planning with an extensive background in taxation. He realized that many of his clients needed more than just tax preparation services. They were starting or running businesses and cobbling together a number of vendors, going to one to do payroll, another for bookkeeping and still another for business taxes.
The process of dealing with so many vendors (and trying to keep them working as a team) was taking up too much of their time—the time they needed to be focusing on growing their businesses. This presented an opportunity for a new business.
- Initial Investment: $41,050
- Net-worth Requirement: $75,000
- Liquid Cash Requirement: $35,000
- Total Investment: $41,050 – $71,400
- The Tayne Law Group
Leslie H. Tayne, Esq. has almost twenty years’ experience in the debt resolution industry. Considered a leader and pioneer in debt relief services, Leslie with the help of her debt resolution team, has reshaped the debt relief industry by providing effective, proven solutions to her clients’ financial needs. The Tayne Law Group, founded in 2001 by Leslie has helped countless businesses relieve the stress and burden that debt has caused.
- Initial Investment: $83,820
- Supporting Strategies
As a Supporting Strategies franchisee, you can help take the load off managers or owners of a business by providing these essential debt collection services, allowing them to focus more on running and managing the business, and seeing to their customers.
Here is how the process starts: you will inquire for more information, then you will meet with the franchise development team. After that, you will submit your franchise application and review your franchise disclosure document.
If you decide that things are a good fit and the time is right to start your franchising journey, then you will sign your franchise agreement, attend training, receive opening-day assistance, and celebrate your grand opening with the entire Supporting Strategies team.
- Initial Investment: $76,930
- Net-worth Requirement: $250,000
- Liquid Cash Requirement: $100,000
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