Tis' The Season For MCA!

The Fourth Quarter holiday season is finally upon us! Starting in October you'll begin to hear the seasonal songs in every mall across America. If you are an Agent or Reseller of Merchant Cash Advance now is the time to boost your marketing and target retailers and other merchants that benefit from the Holidays.

Banks still have their coffers shut to small business according to the Wall Street Journal and business are curtailing on spending. This will mean that the majority of MCA business will be seasonal as most businesses will be reluctant to take on new debt. Here's a couple of tips to make the most out of this opportunity.

1. When targeting these merchants, get 12 months of processing statements! American Finance Solutions will use the upcoming months for payback calculations. This will allow you to obtain pricing that maximizes funding amounts or lowers factor rates since expected payback times will be shortened.

2. Maximize Fast Cash deals! With our Fast Cash program, AFS funds in 48 hours most of the time (some deals take 72 hours since we are waiting on the merchant to download with a new processor). Now that merchants qualify for 50% of their processing average, we can use the foretasted four months going into season, rather than the previous four months.

3. Don't forget about non-retailer merchants. There are so many other merchants that benefit from the Holiday Season! E-commerce are great target market that AFS funds when established. Day spas sell tons of gift certificates! The list is endless, think outside the box and you'll be rewarded!

We look forward to funding all of your deals and filling up your stockings with cash.

American Finance Solutions Official Media Sponsor Of WSAA

American Finance Solutions is proud to announce that it is the Official Media Sponsor of the 2011 Western States Acquirers Association. This year's conference will be held at the San Francisco Hyatt Regency in Burlingame, California on September 21st and 22nd.

The two day event features the Field Guide for ISO's Seminar and tons of breakout session focusing on the future of the payments industry. Marketing with Social Media, Mobile Payments and International Markets will all be highlighted. In addition, there will be plenty of time to visit with vendors and sponsors during breakfast, lunch and cocktail sessions.

AFS will be using the venue to launch its new Agent Portal, enhanced Fast Cash funding program offering $20,000 in 48 hours for merchants without personal credit pulls and an industry first equipment-secured Merchant Cash Advance with low factor rates starting at 1.15.

Make sure you stop by and see us if attending.

Welcome To New North American Merchant Advance Association Members

American Finance Solutions welcomes the addition of five new members to the North American Merchant Advance Association (NAMAA). The recent addition increases the amount of total companies by almost 50 percent and now NAMAA includes almost all reputable players in the industry. The one lone dissident continues to be Advanceme.

Now if you're selling or marketing merchant cash advance or work for a funding company, you may be asking yourself, "What's the big deal?" There are quite a few reasons why this is significant step for the whole industry:

1. Robust "bad merchant" database - If you sell the product, the first thing NAMAA members do when receiving an application is check it against the database. This saves you and your staff from wasting time and resources on known fraud and defaulted merchants.

2. Unbiased communication lines between funding companies - All NAMAA members have made a pledge to exchange true information on merchants and play fair. So often when American Finance Solutions calls a little player for a payoff amount confirmation, we get the run around. Mean while the small funder is desperately trying renew the client immediately. NAMAA members all have a designate contact that gives the real scoop on a client (weather they were even in collections, slow pay, etc) and don't compromise the payoff process. This means if you're selling for one of the companies, you don't have to worry about losing a deal at the 11th hour.

3. Best practices are adhered to - Knowing that you represent or work for a NAMAA member company, you can confidentially market this to your clientele and assure them that you represent a reputable industry player that conducts business ethically.

I believe this marks a turning point for the MCA industry. We've have officially started to move out of the early growth stage and are also quickly beginning to move into the mainstream financial marketplace.

Again, welcome to Strategic Funding, Genesis, Merchant Advance Funding, Merchant Capital Source and Swift Capital.

Let The Second Selling Season Of 2011 Begin!

Now that the kids are back in school and Summer vacations are over, it time to gear up for the Merchant Cash Advances second selling season of the year! Historically the Spring and Fall have turned out to be the prime sales seasons and we are expecting the same for 2011.

More than ever, merchants have the upper hand over suppliers when they have cash. Many of our existing clientele are renewing to take advantage of opportunities. Many are receiving large discounts or other incentives by pre-ordering and paying in advance.

One of our retailers reported a savings of 40%. He pre-paid for this October and November deliveries and is receiving $20,000 of clothing. Given that his mark up is 100%, that means he'll generate $40,000 in sales for a total cost of $15,600 ($12,000 plus the $3,600 in factoring fees). Now that's a smart use of a Merchant Cash Advance!

Restaurants are reporting that they are getting similar concessions from their liquor distributors. Gift and novelty shops are reporting discounts of approximately 30% for pre-ordering and of course speciality toy and hobby stores are squeezing their suppliers for 30% to 50% discounts. If you're marketing and selling MCA, now is the perfect time to adjust your target market and message to capitalize on this selling season. Don't forget to focus on the right types of business and who their market demographics are as well. You want applications from merchants that have the highest chance of getting approved for funding.

At American Finance Solutions, we expect more record funding months in our busiest season. Both high- and low-end retailers should benefit the most in our current macro-economy; and be the most attractive to AFS and other funding companies. (Those with money will continue to spend at the upper-end, while the rest of us move down; and the middle retailers will really feel the squeeze this holiday season!)

Latest Experian Business Benchmark Report Confirms That We're Bouncing Along The Bottom

Last week Experian released its 2nd Quarter Business Benchmark Report. The report reveals nothing unexpected and confirms that our US business climate continues to bounce along the bottom of a recession recovery. American Finance Solutions and other MCA funders play close attention to these trends to make subtle adjustments to their pricing calculators for risk and expected pay back of contracts.

Overall most businesses became somewhat more delinquent on their debts and are stretching out their days-beyond-terms. As for relevancy to the Merchant Cash Advance was the discrepancy between business size. Large business, defined as those with over 1,000 employees, had a huge increase in delinquency. Obviously, these types of business are not MCA clients. Small- and medium-sized businesses either improved their delinquency or had a minimal decline.

The report also reports delinquency by business type. Merchant Cash Advance core business types also had minimal changes to delinquency ratings. Hospitality, retail & services all continue to show steady as she goes, with neither improvement or decline in financial health as sectors.

What does this all mean for our Merchant Cash Advance industry? The trends of increased demand will continue for the short- and medium-term. Risk to funding companies, such as American Finance Solutions, on a whole should see slight improvement. Expect smart industry players, (agents, resellers and funding companies) to aggressively capitalize on a great opportunity to build revenue and market share.

As for pricing, I expect to see little change as demand pushes up some and the continuation of low bad debt will allow funding companies to cut margins some to increase volume. The two should offset each other.

It continues to look like merchant cash advance will be a strong and viable industry to provide small- and medium-sized companies with working capital! As always, American Finance Solutions looks forward to funding all your contracts.

American Finance Solutions Launches New Franchise Working Capital Program

At American Finance Solutions, we recently launched a new Fast Funding program for franchise owners. In the first week the program has been very successful with $500,000 in funding of working capital and another $600,000 in the due diligence phase. Even better than the funding amounts has been the client reaction to the speed of funding. All contracts were funded within 72 hours of receiving contracts back from clients (with required supporting documents of course).

To qualify for the program the business owner needs to own and operate a known franchise. Be in business for at least one day, have or expect credit card processing of at least $5,000 per month, not be behind on rent/mortgage/franchiser fees for more than 30 days, not be in bankruptcy proceedings personally or for the business and have a personal FICO score over 500. So almost all franchises qualify!

Details of the funding programs are as follows:

1. Funding amounts available from $10,000 to $200,000 per location
2. Factor rates range from 1.2 to 1.35 with up to 12 month expected payback
3. Split, lock box and a fixed ACH payback are all available and are the merchants choice (of course ACH requires clean bank statements)

4. Must submit franchisee agreement with contact info, otherwise all normal documentation is all that is needed (business license, voided check, 2 months bank account statements and drivers license for all owners)

If you own a franchise and are looking for working capital at reasonable rates, please give us a call. Or if you are an agent or reseller for Merchant Cash Advance, then give us an email or call at American Finance Solutions to learn more about becoming a partner.

Which Businesses Agents Should Target In An Economic Downturn

As our economic times get more challenging again, the demand for the Merchant Cash Advance product and other alternative sources for working capital will see great increases in demand. If you are selling the MCA product its a great time to seize this opportunity and build your client portfolio. The key will be targeting the right clients that will have the highest chance of getting approvals from American Finance Solutions and other funding companies.

By crafting and targeting your marketing effort you'll greatly increase your return-on-investment for your marketing dollars. Put yourself in the funding companies shoes. Which clients would you want to put your capital at risk with?

1. Recession Proof Businesses are the obvious choice. Just a few of them are:

• Low Ticket Restaurants - People still eat out in tough times, they just go to restaurants that they can afford. The middle market (entree price of $12 to $20 will get crushed once again).
• Auto Repair - People cannot afford a new car, but will plow a few extra bucks into their current vehicle to keep it running.
• Health Care - Dentists are a great example of how medical is generally recession proof. Nothing else makes a client whip out their credit card faster than pain avoidance!
• Liquor/Tobacco Stores - Vices are usually the last thing one gives up, enough said.
• Convenience Stores - When people feel poor (or less wealthy) they'll avoid big trips to the supermarket where they outlay $200 and opt for spending $40 with frequent stops a the local C-store.
• Mini-Escapes - Day spas and nail salons thrive during these times. Instead of spending a weekend at the shore, they do a spa day for the ladies why the guys hit the links (we absolutely love funding golf courses at AFS!)

2. Established Businesses

• Obviously a business with a multi-year track record and established clientèle is much more attractive.
• Clients using funds to take advantage of opportunity of buying a competitor or taking over the space of a failed rival.
• Business where the owner also owns the real estate have much more skin in the game as compared to those that lease. At AFS our risk-based pricing gives major points for this!
• Steady sales for a client goes a long way with funding companies. A business that consistently does $20,000 a month is much more desirable than the one that fluctuates wildly.

By utilizing the above targets and executing efficiently (closing) you'll maximize the most from the current opportunity in the MCA space.