Hospitality finance encompasses various funding structures that help businesses convert outstanding receivables into immediate working capital rather than waiting for customer payments. These finance options include factoring where the lender manages your debtors and collections, invoice discounting that provides advance funds while you retain customer relationships, and selective invoice finance for specific invoices, each offering different levels of control and cash flow acceleration.

This financing approach allows businesses to maintain steady cash flow regardless of customer payment terms while still pursuing growth opportunities that require immediate capital. The receivables-based funding makes it particularly attractive for companies with strong sales but extended payment cycles, or those wanting to take advantage of early payment discounts and supplier opportunities. Many arrangements offer flexible funding levels and can grow with your business as invoice values increase.

Traditional approaches to managing cash flow gaps typically involve waiting for customer payments or seeking working capital loans based on business assets and credit history. When companies rely purely on customer payment cycles, they often struggle with growth opportunities and may miss supplier discounts or strategic investments. This passive approach leads businesses to decline profitable orders due to cash constraints, miss expansion opportunities, and operate reactively rather than strategically managing their receivables and cash flow.