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MDS Funding Newsletter
Second Quarter 2006
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In This Issue
* New Solutions for Business
Financing
* MDS Funding Offers
Factoring and Business Financing Consulting Services
* If You Conduct Business
with the Federal, State or Local Government
* When
* Equipment Leasing Improves
Cash Flow
* Found Money: Borrowing
Against Your Business Assets
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MDS Funding Offers Factoring
and Business Financing Consulting Services
Our extensive experience
providing custom financing programs for a variety of businesses gives us ready
access to a number of financial tools that could be useful to your business.
While in some working capital scenarios we are able to serve you directly as
the funding source, in other scenarios we provide value to you as a consultant
and a gate opener for other sources of business financing.
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If You Conduct Business with
the Federal, State or Local Government
You can access unlimited
working capital using your accounts receivable (invoices).
Factoring Government
Accounts Receivable is a common practice to help small and growing businesses
avoid cash flow problems. One of the key advantages is you eliminate the strain
of waiting 60 days or longer to get paid. Factoring gets you paid within 2-3
business days.
With an improved cash flow,
you can level the playing field and compete with much larger vendors for
government contracts, and increase your ability to comply with contract
performance standards.
Best of all, Federal, State
and Local Government receivables all qualify for factoring under the terms of
the Assignment of Claims Act,
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When
Purchase Order (PO) Funding
is short-term financing that provides 100% of your supplier cost to fill orders
from creditworthy customers.
Here's how it works: When a
manufacturing company receives a $1 million order, it may cost $400,000 in
materials to fill that order. So what happens if you don't have the cash for
the materials, you have stretched your credit limit with your supplier, and
have reached your borrowing capacity at your bank?
Purchase Order Funders
(Factors) will advance the funds necessary to fill the materials order. This
will entail either a direct payment to your supplier or a Letter of Credit
posted on your behalf.
As soon as your customer's
purchase order is filled and your invoice for payment is generated, the
factoring process begins. When your
customer sends payment of the invoice, the Factor will deduct his/her cost for
the materials and fees, and then remits the balance (rebate) to you.
THE BOTTOM LINE: You can
promptly fill your customer's purchase order, gain the associated profit, and
prevent the potential loss of future orders.
Who typically qualifies for
Purchase Order Funding?
* Companies that drop ship
products from suppliers to creditworthy customers, or who have either light
assembly or repackaging before final shipment
* Companies that need a
minimum of $50,000 in financing
* Companies that are
distributors or resellers of finished goods
* Companies with gross
profit margins greater than 10%
For real life scenarios
about businesses using
Purchase Order Funding,
check out this great article
by Crystal Detamore-Rodman
from Entrepreneur
magazine, entitled Can I
Take Your Orders? (http://rs6.net/tn.jsp?t=g7dpmwbab.0.0.9qe8xhbab.0&p=http%3A%2F%2Fwww.entrepreneur.com%2Farticle%2F0%2C4621%2C301605%2C00.html)
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Equipment Leasing Improves
Cash Flow
Businesses of all shapes and
sizes need equipment to
operate. But for some
organizations, especially start-
ups, the cost of that equipment
can far exceed
current working capital. For
many businesses,
Equipment Leasing is the
solution.
When the decision comes down
to buying versus
leasing, often it makes the
most sense to lease and
avoid a single cash outlay
for the full purchase price.
In the medical field where
changes in
technology can make the
difference in generating
additional revenue and
improving the standards of
healthcare, leasing may be
the only viable option.
Benefits of Equipment
Leasing:
* Leasing is simple and
convenient, and it ensures
you have the equipment you
need - when you need
it
* Economically, leasing
makes sense
* With 100% financing,
leasing puts working capital
to work
* By paying for today's
productivity with
tomorrow's dollars, leasing
serves as a hedge against
inflation
* You can gain a competitive
advantage by
exercising your option to
upgrade to state-of-the-art
equipment
* Leasing can pay for itself
with
revenues generated from the
use of the
equipment
Examples of equipment that
can be leased: office
phone systems, computers and
software, office
furniture, vending machines,
medical equipment,
factory machinery and
trucks.
For more information
about how your business
might benefit from
Equipment Leasing, check out
this great article from
the Small Business
Association entitled Equipment Leasing 101 (http://rs6.net/tn.jsp?t=g7dpmwbab.0.0.9qe8xhbab.0&p=http%3A%2F%2Fsbinformation.about.com%2Fcs%2Fbestpractices%2Fa%2Faa090302a.htm).
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Found Money: Borrowing
Against Your Business Assets
At MDS Funding, we work with
a select few industry-
leading companies who
provide financing
collateralized by a
company's assets (Asset Based
Lending). This is a great
solution for a rapidly growing
yet highly leveraged
organization. By borrowing
against current assets
(accounts receivable,
inventory, and equipment)
management is able to
generate cash sooner than if
it had to wait for
inventory to become accounts
receivable, and for
accounts receivable to
become cash.
Wholesalers, retailers,
distributors, manufacturers
and service companies can
all benefit from Asset
Based Lending.
For more information and a
list of the steps required
to get started, you can read
Asset Based Loans (http://rs6.net/tn.jsp?t=g7dpmwbab.0.0.9qe8xhbab.0&p=http%3A%2F%2Fwww.entrepreneur.com%2Farticle%2F0%2C4621%2C300789%2C00.html)from
Entrepreneur
magazine.
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New Solutions for Business
Financing
With this issue I'd like to
introduce you to some of
our newest services:
* Government Accounts
Receivable Funding
* Purchase Order Funding
* Equipment Leasing
* Asset Based Lending
Special Attention:
Profitable
businesses sometimes go out
of business, whereas
businesses with a positive
cash flow can pay
their bills.
Summer Solution: For some
business owners the advent
of summer brings a
much-needed slow down
allowing for an increase in
quality time to spend with
family and friends. While
the simpler pace may be
enjoyable, a slow down in
business can have a negative
impact on your cash
flow. Customer vacations can
adversely affect your
sales and often cause delays
in payments from even
your best customers. This
situation leaves many
business owners seeking
options for short-term
financing.
Fortunately for you, the
professionals at MDS
Funding can introduce you to
a variety of financing
options to get you through
the heat of summer.
In previous issues I've
shared with you the details of
my core business: factoring
invoices. I explained in
simple terms how factoring
provides business owners
with an immediate cash
infusion. Factoring
continues to be a great
solution, especially for
businesses with long
receivable cycles
(personnel/temporary
agencies, IT companies and
commercial printers).
Factoring is also an effective
financial tool for medical
practices, imaging centers,
emergency transportation
companies and other
healthcare providers who
have third-party insurance
claims.
MDS Funding,
LLC (http://rs6.net/tn.jsp?t=g7dpmwbab.0.0.9qe8xhbab.0&p=http%3A%2F%2Fwww.mdsfunding.com%2F)
Improving Cash
Flows
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email: mmoss@mdsfunding.com
phone: 678-353-3265
web: http://www.MDSFunding.com
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