Don’t just choose the first company that offers you money upfront. Ask the following five questions to weed out unqualified funding partners and choose a partner that will help you grow:[more]
- Do you specialize in staffing?
Every type of business has its own set of nuances, and if your funding partner does not understand your business, things will fall through the cracks. Staffing firms have business cycles that ebb and flow throughout the year, and there is nothing worse than a funding partner that tightens the purse strings as soon as times get tough.
- Do you have your own staffing business or an affiliation with a competitor?
Many payroll funding companies have their own staffing businesses on the side or have a vested interest in one of your competitor’s success. If you’re working with a payroll funding company with ulterior motives, you may be compromising your company’s growth and proprietary information.
- Are you self-funded?
If your payroll funding company agency is owned by a bank or backed by another company, they will have little to no control over their funding decisions. With a self-funded independent partner, you won’t have to jump through hoops, wait for committees or navigate red tape to get your funding. Self-funded providers are able to control their own lending, which limits their restrictions and offers more flexibility for game-day decisions and urgent needs or opportunities.
- How is your fee structure set up?
Depending on your funding partner’s fee structure, you may get slammed with hidden fees when you least expect it. Many funding partners include language in their contracts that allow them to automatically raise your fees if you’re out of formula or go over your concentration limits. To avoid these hidden monthly and administrative fees, look for a funding partner that makes all of their fees visible upfront.
- What do you offer beyond funding?
If you’re working with a partner that only offers funding, you’re truly doing your business a disservice. Look for a funding partner that has a network of partners to pull from when you want to compete for major contracts. Qualified funding partners like Advance can connect you with partners outside of your geographic area and offer additional services such as credit research, strategic planning, diversity programs and growth assistance. In addition, with some companies like Advance, you can even outsource your payroll, payroll tax, invoicing and technology needs. Whether you ultimately decide to outsource these back office functions or not, expertise and knowledge in these crucial areas of your business are incredibly valuable in a payroll funding partner.
Don’t waste your time on unqualified funding partners. Work with a qualified partner like Advance for a true funding partnership for your staffing firm.
For more information, view the payroll funding section of our website.