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“Advantages Of
Factoring”
Ben10 Members: × Ben Jose× Christeena James× Deepa Rose Jacob× Indu Sukumaran× Jenita× Stephanie× Binu
• Factoring is when a third-party firm, or
factor, “buys” a business’ accounts
receivable and gives the business a cash
advance based on those unpaid bills. The third
party then takes over collecting the owed
receivables. The process allows the business
access to cash faster, rather than waiting 30 or
60 days to collect payment from customers.
• It’s a form of financing used by companies to
maintain cash flow.
• It’s more common in certain industries where
immediate cash is necessary to operate the
business, like staffing, textile and printing firms.
Advantages
Of
Factoring...
Time Savings - Factoring can save your time and
efforts that would otherwise be spent on
collecting from customers. That energy can be
redirected to other business-building endeavors,
like sales, marketing and client development.
Good Use for Growth - You can use the instant
cash to generate growth, maybe hiring another
salesperson who will bring in more business. Or
buying an advertisement that will reach new
customers. Or buying a piece of equipment that
will accelerate production.
Doesn’t Require Collateral - Unlike traditional
bank loans, factoring doesn’t require you to risk
your home or other property as collateral.
Qualify for More Funding - Factoring firms will
typically give a cash advance on up to 80% of
your receivables, that may be more than you
would be able to get from a bank.
THANK YOU