1. Leverage your customers credit.
2. Factoring is faster than a bank loan. The documentation is straightforward
3. Factoring company acts as your Receivables Management company, providing real time status of your outstanding invoices. They will be in charge of collections.
4. The Business can concentrate on Sales and Marketing instead of chasing up unpaid invoices.
5. Factoring companies will do credit checks on your customers and warn you of potentially high risk customers.
6. Faster incoming cash flow to meet overheads plus capital investments either by way of outright purchase or equipment leasing. If leasing, then guaranteed cash flow will help the business calculate lease payments.
7. The business can choose which invoices to factor, how much they want in factored funds and for how long. Alternatively they can factor all invoices indefinitely.
8. Increased cash flow means the business can take advantage of early payment discounts from its suppliers.
9. The Business can stop offering early payment discounts to its customers. In practice, customers who have more time to pay, buy more goods and services more frequently.
10. Faster incoming cash flow means a business can build or repair its credit and service debt more confidently.
11. Accounts Receivables become an immediate liquid asset, instead of a contingent asset on the Balance Sheet.
12. Factoring reduces the amount of Bad Debt which appears on the Balance Sheet.
13. Since Factoring is the sale of invoices for cash, no new debt is incurred.
14. No need for the business to surrender equity.
© 2007 Sanjeev Aaron Williams & Cashwerks All Rights Reserved
2. Factoring is faster than a bank loan. The documentation is straightforward
3. Factoring company acts as your Receivables Management company, providing real time status of your outstanding invoices. They will be in charge of collections.
4. The Business can concentrate on Sales and Marketing instead of chasing up unpaid invoices.
5. Factoring companies will do credit checks on your customers and warn you of potentially high risk customers.
6. Faster incoming cash flow to meet overheads plus capital investments either by way of outright purchase or equipment leasing. If leasing, then guaranteed cash flow will help the business calculate lease payments.
7. The business can choose which invoices to factor, how much they want in factored funds and for how long. Alternatively they can factor all invoices indefinitely.
8. Increased cash flow means the business can take advantage of early payment discounts from its suppliers.
9. The Business can stop offering early payment discounts to its customers. In practice, customers who have more time to pay, buy more goods and services more frequently.
10. Faster incoming cash flow means a business can build or repair its credit and service debt more confidently.
11. Accounts Receivables become an immediate liquid asset, instead of a contingent asset on the Balance Sheet.
12. Factoring reduces the amount of Bad Debt which appears on the Balance Sheet.
13. Since Factoring is the sale of invoices for cash, no new debt is incurred.
14. No need for the business to surrender equity.
© 2007 Sanjeev Aaron Williams & Cashwerks All Rights Reserved
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