Advantages of Factoring






Advantages of Factoring include advantages to your overall business such as profitability, stronger balance sheet, higher productivity, use to time to run your business instead of being tied up with creditors.




Advantages of Factoring

  • Simple and Fast - Minimal application requirements.


  • Improve Cash Flow by being paid in a timely manner


  • No Consideration of a Businesses Credit Rating as the factor is more concerned by your customers credit rating than yours.


  • Leverage Off Customers Credit by being paid on time.


  • Continuous Source of Operating Cash with continued factoring.

  • There are No Long Term Contracts required.


  • Factoring Provides Credit Services- Credit Screening & Monitoring, Early Detection of Customer Service Problems


  • Client Gets Detailed Management Reports on a monthly basis.


  • Faster Invoice Payments - Usually within 48 hrs.


  • No Debt Created – No Monthly Payments or Balloon payments with some loans.


  • No Personal Guarantees needed as with most loan programs.


  • No Geographical Limitations.


  • Reduces Overhead – Helps Business Downsize so client can concentrate on growing his/her own business.


  • Important Advantage og Sactorind - Greater Operating Efficiency – Professional Invoice Processing that can allow for more productive use of resources.


  • Off Balance Sheet Financing- Not a loan and need not be reported to any perspective lending institution.


  • Time Value Of Money is always an important factor the faster you get paid the more money you can make.


  • You Retain Control of your Business – You Do Not Give Up Equity as in borrowing but are still able to seek alternative forms of financing if desired.


  • Factoring Can Reduce Bad Debt through timely collections on invoices.


  • Professional Collections are handled by the factoring company.


  • You Can Offer Credit Terms to Your Customers therefore are able to accept more business.


  • Allows the Business the Ability to Meet Increasing Sales Demands and expand.


  • Offers the Ability to End any Early Payment Discounts.



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Advantages of Factoring