Ultimate Guide To Invoice Factoring In Toronto

 Invoice factoring in Toronto Canada

Being the largest city in Canada with a population of over five million people, Toronto has consistently been known as Canada’s hub for business, finance, art, and culture. It is widely considered to be the best place for young, driven individuals to seek out new career opportunities in their given industry. In addition, it is well known as a strong location for companies to continue to build their teams, grow their revenue, and ultimately, achieve their goals.

As a result of the opportunities that Toronto provides today’s businesses, industries like manufacturing, staffing, and logistics have gravitated towards this area of the country in order to grow their companies and attract wanted talent. Whether it be that companies are choosing to start their companies in Toronto or are deciding to open up additional offices in Ontario’s capital, businesses are seeing the value of ensuring they are getting a piece of the opportunities that Toronto can offer their businesses.

In this article, we discuss Toronto’s overall business landscape and how invoice factoring can help your business keep up with the growth opportunities Toronto presents.

The Basics of Invoice Factoring In Toronto

Great For: Business small and large with receivables Eg Staffing, Oil & Gas, Transportation, Manufacturing etc.
Funding Amount: 10K-25 Million Dollar Lines
Advance Rate: 80-95%
Discount Rate: 0.3% - 4%
Years in business No requirement! (We have funded many great startups)
Qualifications: Creditworth customers and invoice B2B or B2G customers
Repayment Terms: Client pays to factor on terms. Typically 30-90 days.
Application Process Easy and Online, E-sign enabled

Toronto Overview

Toronto is known as one of the most multicultural and diverse cities around the globe. It is the home for both companies and candidates who are looking to experience growth and opportunities that they would not be able to achieve in other locations. With a unique combination of events, attractions, and sports teams, Toronto continues to attract a wide variety of people and companies who are looking to experience the exponential growth that Toronto has seen year over year.

Toronto holds the torch for having one of the most diverse economies in the world due to the fact that while it is known for having one of the fastest growing financial industries, it also houses a great deal of other industries. With 32 percent of the population working in the finance industry, ten percent work in manufacturing, 8 percent work in professional services, 6 percent in wholesale, 6 percent in health services, 5 percent in information and culture, 5 percent in education, 5 percent in government, 5 percent in construction, 5 percent in retail, and 14 percent in other. As you can see, Toronto offers a wide variety of opportunities to its inhabitants and continues to grow those opportunities as it attracts more and more startups and established companies.

Toronto is the host of 40 percent of Canada’s business headquarters. It is also the home of the best and brightest candidates who are looking to join these companies, many of which are part of the 6.4 million people who identify as a visible minority. Diane Jermyn states: “That rich multicultural mix translates directly into increased innovation as diverse perspectives inspire fresh solutions for industry challenges and drive new product development.”

Looking at Toronto’s multiculturalism, it’s wide variety of prominent industries, and its ability to attract companies and talent, there is no question as to why it has become a hub for business.

Manufacturing Industry In Toronto

Toronto is the home base for some of Canada’s fastest growing manufacturing companies. Some of which include: GreenSpace Brands, Jenny Bird, and Therapure Blopharma. From 2011 to 2016, GreenSpace Brands grew 2,861 percent, Jenny Bird grew by 1,119 percent, and Therapure Blopharma grew by 613 percent. The exponential amount of growth means the need for capital and additional talent has also grown.

With the manufacturing industry accounting for 9 percent of the job market in the Toronto area - which is second after the finance industry - it’s crucial that companies do everything they can to remain competitive. However, the manufacturing industry is known as the oldest industry. Not in the sense of time, but in the sense that this industry has a large amount of workers who are set to retire between 2014 and 2023, and the industry will struggle to fill this new influx in role vacancies. Over the course of this nine-year period, there will be over 60 thousands roles vacated and only enough people to fill approximately 28 thousand of those roles. Remaining competitive within the market is what is going to allow you to acquire as many of these available candidates as you can.

Another solution to this issue would be to provide additional in-house training to new candidates who may not have all the necessary skills but are willing to learn. However, this means more funds are needed to not only set up these training programs, but also conduct them. Invoice factoring is a great option to help fund these programs for your company because instead of waiting for clients to settle their invoices, you can have access to the capital right away. You can fund your growth and additional expenses by using invoice factoring.

It’s also important to retain as many employees as you can. The average age of workers in the manufacturing industry is over 45. Therefore, manufacturing companies are set to need to replace a large chunk of their workers in the next ten years. Building up your company as a reliable and desirable employer will allow you to attract more candidates are you approach this influx of retirees. Invoice factoring will allow you to fund various tasks that you can complete in order to obtain this kind of reputation for your company. These could be items that improve your company culture, that ensure your employees have all the tools and software that they need to do their jobs effectively, and so much more. Having capital readily available as you grow and develop your employer brand will help set you apart from the other manufacturing companies who will also be looking to bring on countless employees as their current ones begin to retire.

Staffing Industry In Toronto

One of the industries that we work heavily in is the staffing industry, which is highly competitive in the Toronto area. There has been a 20 percent increase in the amount of temporary staffing agencies in Ontario over the past decade. With Toronto account for 35.4 percent of Ontario’s total population, a large amount of these staffing firms are choosing to set up shop in Canada’s hub. In fact, with 1,700 active temporary staffing agencies in the GTA alone, Toronto has more of these agencies than the rest of the provinces combined.

In today’s market, more and more companies are choosing to leverage temporary staff. Companies choose to leverage this because while some companies may have a steady influx of clients and work all year round, some companies experience seasonal influxes. There are points when they have more work for the amount of staff that they have, so they need to bring on some more bodies. But, there are also times when business is slow, and they don’t want to be in a position where they need to compensation all permanent employees when revenue is slower. With more and more companies option to bring on temporary workers, more and more agencies are popping up.

This influx of temporary staffing agencies, in the Toronto area alone, give not only companies more options, but candidates as well. While companies can pick and choose which agency to work with, candidates can also choose which company they want to represent them. Should one of your staff members not be happy with your business, they can easily head over to one of the other 1,699 temporary staffing agencies to be placed somewhere else.

Payroll factoring plays a big part in making sure that you can compete with other firms. As a staffing firm, you know the kind of role that compensation plays in your ability to place a candidate, temporary or not. If the compensation isn’t there, candidates quickly move to other companies. That’s why it’s incredibly crucial to ensure that your staff is being compensated properly. However, there will be times when clients do not compensate you on time. So, what do you do in the situations when a client hasn’t settled their invoice, and you have a bunch of staff member’s to compensate? Do you ask them to wait? Absolutely not. This goes back to employee happiness, strong company culture, and your employer brand. You do not want to be known as the employer that doesn’t pay their employees on time. This not only causes people to leave your company, it also causes them to spread the word that you make a habit of not compensating your employees.

With your staff being, ultimately, what you offer your clients as a service, making them a top priority is what is going to make or break your company. Once the word gets out that you struggle to pay your staff, it’s incredibly difficult to break away from that reputation. Enter payroll factoring.

As a cash flow solution, Payroll Factoring is a type of working capital that is used specifically for the temporary staffing industry. It is a service that allows staffing companies to have access to between 90 and 95 percent of their outstanding accounts receivable upfront so they can compensate their staff and pay for any other expenses they have incurred.

Staffing companies use Payroll Factoring because regardless of if their clients pay in seven days or 90 days, the cash is there for them to meet payroll requirements. By using Payroll Factoring in your overall business strategy, you can grow your staffing company without the cash flow issues that arise when payroll needs to be made before you are receiving payment from your clients. And, as your company grows, your Payroll Factoring line of credit will grow with you.

At the end of the day, you won’t have to worry about when your client pays you because you will already have access to the capital. You will be able to pay your staff, and keep them happy, pay your expenses, and any other items that need to be paid for without worrying about where the funds are going to come from.

Our Track Record In Toronto

With Toronto having such a strong presence in the business market, we have been helping Toronto based businesses thrive for years. With Toronto being one of the world’s hubs for both startups and established companies, the need for company growth is prominent and in need of adequate support. Invoice factoring is an option that many companies in the Toronto area are choosing to use because it allows them to continue to grow and compete with the other companies that are also taking advantage of Toronto’s lucrative business landscape.

Having been working with businesses in Toronto for years, we have feet on the ground. We have team members that can meet with you in person to discuss your options and discuss information. While technology gives us the option of working with anybody anywhere in the world, being able to meet in person to discuss a long-term partnership allows for more effective communication and transparency, which we can provide in the Toronto area.

In addition to having feet on the ground in Toronto, we also have a funding office in Buffalo, New York, which is just a short drive away. If you wish to visit our funding office and learn more about our company and what we offer, it’s a short trip away!

Being A Business In Toronto

Toronto is continuously growing and becoming more competitive. To keep up with the competition and avoid losing business to your competitors, you need to have a steady flow of cash that you can use to bring on more staff, pay expenses, and make any other purchases that are going to help you achieve your goals.

Without an efficient cash flow plan, you’re at high-risk for losing clients to competitors, going stagnant, and even losing staff members. The job market in Toronto is also aggressive and keeping your employees happy and fulfilled is what is going to ensure they remain loyal to your company and your mission. Removing the stress of cash flow by using invoice factoring will allow you to focus on other mission critical tasks in your business so you can compete with the best of the best in the Toronto area.

Learn More About Utilizing Factoring For Your Business

If you have any further questions about invoice factoring for your Toronto based business, feel free to reach out to us here at Meritus Capital anytime by email at info@merituscapital.com or call us toll-free at 1-877-648-3709. We have been providing factoring services to businesses across Canada and the U.S. for almost 20 years!

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