Operating in the publishing and advertising space is not easy. When you are a publisher or advertiser providing services, sometimes you have to wait for months before your clients make the payments.

The lifecycle of funding in the publishing and advertisement ecosystem begins as soon as you decide you want to advertise or publish.

The business may come from small organizations as well as large multinationals. Hence, the size of these companies puts them in-charge of dictating the payment terms to publishers and advertisers.

This often includes extended payment terms, squeezing you for every dollar they spend. Thus, for publishers and advertisers, receivables finance is the most viable solution to alleviate pain in working capital flows.

Financing publisher and advertising receivables allow businesses to continue to operate by helping to meet their expenses, by discounting the receivables in relation to their income. Nowadays, a publisher usually pays for promotion but does not get paid on advertisement revenue until later.

To stay competitive, intermediaries offer favorable terms to pay their publishers. However, these intermediaries get paid by their clients on less flattering terms.

To get a new client on board, ad agencies at times have to expand their resources. However, they do not get paid immediately and often have to wait for 120 days.

By factoring publisher and advertising receivables, all parties, including intermediaries, publishers, advertisers, and agencies, can have free cash at their disposal. This cash flow helps them promote their business, take on new projects or clients on board, and payout publishers.

Receivables finance can help publishers and advertisers bridge their funding gap, while waiting for the payments to come through from their clients or partners. This financing comes in the form of factoring or discounting their advertisement and publishing sales revenue.

If you are in the publishing and advertising industry, you can get funding often on a daily basis. This will help you cover your immediate operational expenses for 30 to 120 days. Once you have the payment, you can always pay back the financing institution as per the terms they offer.

The process is straightforward and entails four basic steps. Once you contact the factoring or receivables finance company, they will look at your payment schedule and assess the creditworthiness of your pending invoices, partners, and customers.

In the next step, they will verify your invoices via direct human contact. If the ownership structure appears clean and the factoring or receivables finance company does not see any red flags during their diligence (such as a pending bankruptcy, etc.), they will wire you the proceeds of the receivables (minus an agreed discount).

Typically, turnaround time is three working days. After that, follow the process mentioned below.

• Submit all your invoices at the end of the month for funding approval each month.
• The factoring or receivables finance company providing you the financing facility will evaluate them; they will either approve or deny every invoice individually. Their reason for denial may include recent discovery of bad credit reports of your customer/s, or the factoring institution may have reached its internal limit of how much funding they can offer you.
• However, if your invoices get approved, the factoring company will transfer the agreed percentage of each invoice the same or the very next working day.

The beauty of the publisher and advertising receivables is flexibility. You are not obliged to sell all your receivables to a factoring company; you can choose against which invoices you want to get the receivables funding.

Additionally, the receivables’ fee is usually pro-rated and on a daily basis too. Therefore you do not have to pay a full month’s fee if you will use this funding for a few days or weeks. You pay the fee for the days you utilize this facility.