Waiting for insurers to pay your invoices for completed repair work can put real pressure on your cash flow. Invoice factoring is a simple and fast way to turn insurer invoices into cash, so you can keep your workshop running with a lot less stress.
The simple and fast way for smash repairers to unlock cash flow
Invoice factoring is a popular financial service that gives smash repairers early access to the money owed to them by insurance companies. Instead of waiting for insurers to pay, you send the invoice to a factoring company and get paid upfront (less a small factoring fee). The invoice factoring company then collects the money from the insurance company.
Also known as invoice discounting, invoice factoring provides working capital for smash repairers. Get reliable access to cash when you need it, without having to wait weeks (or even months) for the insurance company to pay.
For smash repairers in Australia, invoice factoring offers:
- Faster access to cash
- Less stress dealing with insurers
- More control over your cash flow
- The ability to plan with confidence
If slow-paying insurers constantly hold your business back, invoice factoring can make a huge difference. It helps take the pressure off you and your business and lets you get on with what you do best.
Here’s what’s involved in invoice factoring in simple terms:
- You complete the repair.
- You invoice the insurer for the job.
- Instead of waiting, you send the invoice to a factoring company.
- You get paid today, not months later, with a small factoring fee deducted.
- The factoring company then collects payment from the insurer.
Why smash repairers rely on invoice factoring
The smash repair industry is unique. Most panel beaters, mechanics, auto shops, crash repairers and paint shops rely on insurer payments, and insurers aren’t known for paying quickly.
Payment delays of 30, 60 or even 90 days are common. These delays cause cash flow problems that can affect every part of your workshop. Invoice factoring helps you stay in control by giving you same-day access to the money already owed to you.
The benefits of invoice factoring for smash repairers in Australia:
- Immediate cash flow improvement: Get money in your account the same day you send the invoice for factoring. No more waiting. No more chasing.
- Stay on top of wages, rent and supplier bills: Cash delays make it hard to keep up with everyday costs. Factoring helps you pay your bills on time and keep your workshop running smoothly.
- Avoid bank loans and overdrafts: Factoring isn’t a loan. There’s no debt. No interest. No repayments. You simply get paid early for work you’ve already done.
- Reduce stress and pressure on your business: Instead of worrying about cash flow, you can focus on repairs, customers and growing your workshop.
- Save time and avoid insurer phone queues: Factoring companies pay you quickly then chase the insurer for payment. This gives you back hours of your week.
- Smoother BAS and tax period planning: Many repairers struggle with tax obligations when insurer payments arrive late. Fast access to cash you are owed makes tax time easier and less stressful.
- Keep staff and suppliers paid: Fast, predictable cash flow helps you maintain strong relationships with your team and your suppliers.
Invoice factoring can be the difference between struggling to keep up and staying consistently ahead.
A step-by-step guide to invoice factoring for smash repairers
- You complete the repair: Once your workshop finishes the job, you can issue the invoice.
- You prepare your invoice addressed to the insurer: This is the normal invoice you would usually send to NRMA, IAG, Allianz, Suncorp or another insurer.
- You send the invoice to us instead: You forward the invoice directly to Working Capital Finance, not the assessor or insurer.
- We fund you immediately: You get paid the same day, less a small fee.
- We collect payment from the insurer: We take care of following up with the insurer, so you don’t have to.
A quick example:
- You invoice an insurer for $5,000
- You send the invoice to us
- We pay you $4,900 the same day
- The insurer pays us the full $5,000 later
Invoice factoring, or invoice discounting, provides much-needed working capital for smash repairers. It is the simple and fast way to avoid long insurer payment cycles, get the money you are owed immediately and inject much needed funds into your business.
You stay in complete control, and you can focus on keeping your workshop busy and your customers happy, not spending hours chasing insurance companies for payment.
Ready to get started with invoice factoring?
Look for an invoice factoring company that understands your industry and business. Working Capital Finance specialises in invoice factoring for smash repairers across Australia, and we’ve been doing it since 2005. We fund invoices fast (often within a few hours) so you can keep your workshop moving.
Information provided in this article is of a general nature and does not consider your personal situation. It does not constitute legal, financial, or other professional advice and should not be relied upon as a statement of law, policy or advice. You should consider whether this information is appropriate to your needs and, if necessary, seek independent advice. This information is only accurate at the time of publication. Although every effort has been made to verify the accuracy of the information contained on this webpage, Working Capital Finance disclaims, to the extent permitted by law, all liability for the information contained on this webpage or any loss or damage suffered by any person directly or indirectly through relying on this information.