What is Factoring?

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Not many know what Factoring is and if they do... they usually think it is overly complicated and don't bother with it.


Let me simplify this.

Basically what you are doing is paying a discount so you can get money today instead of waiting.

Sometimes this makes sense and sometimes it doesn't.

As we all know in business it comes down to CASH FLOW.

And if a lack of CASH will lose you a SALE you may want to entertain this OPTION.

Allow me to illustrate.

Let's say you are a manufacturer or a distributor and you receive a PO from a credit worthy entity who will pay you 30 days after install which is fine HOWEVER you don't have the CASH to fill the order.

FACTORING can get you the CASH so you can fill the order.

Or you have filled the order, invoiced your credit worthy customer and it is going to be 30 days before they pay you or longer. Well you really can't wait this long to get paid as it disrupts your CASH FLOW. Factoring can buy the invoice from you for a small discount. Now you don't get all your money but you will get most of it.

Again it all comes down to CASH FLOW and the TIME VALUE OF MONEY.

MONEY IS FUNNY AS WE DON'T ALWAYS HAVE IT WHEN WE NEED IT.

 

Factoring can be a solution and this is the goal of Allstate Capital... to provide our clients financial options. There is no perfect financial tool. What is perfect is having a partner like Allstate Capital to provide you tools so when any given situation arises you are prepared and don't miss a SALE.

Please call me with any questions on factoring or any of our financial solutions

John Papadopoulos

800.949.0018 X 202

"QUICK TURNAROUND FOR ALL CREDIT TYPES"

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This page contains a single entry by John Papadopoulos published on September 22, 2011 11:28 AM.

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