Factoring and Referring — Foreclosure Cleaning Biz: How to Handle Growing Pains in Your REO Trash Out / Foreclosure Cleaning Business
Growing pains can include getting too much work, too fast, and not being able to handle it all. Here are some easy strategies to guide you to start-up success.
Growing pains can include getting too much work, too fast, and not being able to handle it all. Here are some tips to help you manage and grow your new small business while completing jobs successfully and retaining clients.
Problems with “Cash on Hand”
One of the main problems of growing too fast is lack of cash flow. If you’re a new company owner, you may have performed several jobs already. Your financials may shine on paper; but in the real world, you may not have enough cash at the ready because you have not been paid for those invoices cluttering your inbox.
It’s really not unusual for property preservation enterprises to take thirty to from sixty to ninety days to pay invoices due. But as a new foreclosure cleaning company owner, how are you supposed to manage? You likely need your money. You need those invoices paid so you can pay your workers, buy trash out supplies, put gas in your vehicle, pay bills such as insurance and rent, and ultimately to pay yourself.
There are some effective solutions to getting paid within days for foreclosure cleaning work performed. Read on …
Solutions to Grassroots Foreclosure Cleanup Business Growing Pains
One solid solution to handling cash flow issues is selling your property preservation companies’ invoices. This is called factoring, which consists of selling your foreclosure clean-up invoices to a finance company that will pay you the cash owed by your client. The financing operation will keep a percentage of the monies collected as their fee for playing the waiting-to-get-paid-game. But it can be a good option for new entrepreneurs needing cash within days of completing clean-up jobs.
There are several up and down sides to selling foreclosure cleanup invoices, so do a little research on the internet to choose the right company. (For more factoring tips and precautions, see How to Keep Cash Flowing In Your Foreclosure Clean-up Business, http://www.foreclosure-cleanup-blog.com/?p=1600.)
Turn Away REO Trashout Work
A second way to protect yourself so you don’t lose clients is to turn away trashout work. Yes; really. Turn away REO work orders. On its face, this may not seem like the route you want to take, but turning down work can actually help you make more money with your cleaning and trash-out business. Think about it; if you are swamped and can’t handle work orders successfully as they come in, you quite frankly will eventually screw up the work. This is a sure fire way to lose a property preservation client before their name is even wet in your rolodex. Tell the potential REO client you’re simply swamped but would like to help them get the job done.
How? You can help that property preservation company by referring that foreclosure work order out to a competent, vetted industry colleague.
With an iron-clad referral agreement and a solid list of “competing” real estate industry colleagues, you can add exponentially to your business’ bottom line by getting paid a percentage of each job you refer out. Remember the key is an iron clad referral agreement.
The above are just a few ideas to help you. There are many other ways to tackle the hurdle of small business growing pains. See Foreclosure Cleaning: How to Handle Small Business Growing Pains at http://www.foreclosure-cleanup-blog.com/?p=7697 for more small business solutions.
Question and Answer — Foreclosure Cleanup Business Growing Pains: Too Much Work, No Time to Market, Cash Flow Problems, Losing Clients — http://www.foreclosure-cleanup-blog.com/?p=7687
How to Keep Cash Flowing In Your Foreclosure Cleaning Enterprise, http://www.foreclosure-cleanup-blog.com/?p=1600
How to Grow Your Foreclosure Clean-up and REO Trashout Biz by Making It “the” One-stop Shop, http://www.foreclosure-cleanup-blog.com/?p=38
Cassandra Black is a foreclosure cleaning business consultant and small business author. She has written several books, reports and forms about entrepreneurship and the foreclosure cleanup industry. She is also the author of a children’s picture book about entrepreneurship entitled, When I’m Big & Grown. Cassandra’s next book, How to Start & Finance a Small Business While Collecting Unemployment, will be available on Amazon and Barnes & Noble (new release date TBD).