Extracting Timely Payments With Dental Factoring
Extracting teeth might be your business, but extracting quick payments from customers is what really keeps your dental company operational throughout the years. However, with most insurance payments averaging a month in waiting time, your business can take a serious hit while you’re waiting around for your income. Fortunately, you can take advantage of dental factoring, which provides you with a way to get paid more quickly and to make fast cash off of your outstanding invoices.
What is it?
Dental factoring is a process in which you take your open patient invoices and sell them to a financing or factor company. In return, these companies pay you around 80 percent of the total amount up front. They typically pay the remaining percentage once they’ve collected the money from the patients or their insurance providers themselves. Typically they’ll take a small cut out of the total as a financing fee, which is to be expected.
What are the Benefits?
The main benefit is, of course, the ability to get your dental practice the cash it needs to continue operations. Whereas you might have to wait months for much-needed cash flow when working with more traditional payment methods, when using dental factoring you can get the money you need within days. This leaves you free to improve your business right away. Invest in new equipment, hire new employees, work on expanding your business or simply put out new advertising. It’s your money, and you can do what you need to with it.
This is also a debt-free way of getting your practice the cash it needs. This arrangement is much more like an actual sales transaction than taking out a loan. Therefore, you don’t have to worry about using a sizeable chunk of your profits to repay a loan each and every month. The money that you receive from the factoring company is yours – you’re just getting it more quickly.
Finally, this makes keeping up with your income and expenses much easier when it comes time to organize the books and accounts. Normally, you’d need to keep up with dozens or hundreds or small, individual payments and transactions. However, when you use this method, you’re receiving a single payment for your invoices. This is far easier to keep track of and record where your records are concerned.
These are just some of the ways in which dental factoring can help your business by getting it fast cash in a reliable and risk-free way. Speaking with a professional is the best way to decide whether or not this is the right move for your business in the years to come.