Consider factoring or invoice discounting
When the decision is made to pursue a factoring, invoice discounting or invoice financing, you should have a clear understanding of your own goals, as well as the results expected from the factoring or invoice discounting. This will allow your company to take full advantage of the comprehensive range of factoring or discounting services available. Factoring and discounting is a particularly viable alternative for a growing company unlocking cash tied up in a sales ledger. In such a business environment, control is essential because managerial and financial resources are constantly being challenged. Factoring, invoice discounting or invoice financing can ease cash-flow problems and provide some predictability in a rapidly changing situation. Factoring, invoice discounting or invoice financing can also increase the availability of working capital and alleviate cash-flow problems: An acquisition, for example, can expose the firm to a new and unfamiliar customer base, thereby creating a need for enhanced receivables management. And since granting trade credit is comparable to making an investment in another company, a factor's credit protection helps prevent unsound investment decisions.
Author: Toni Nicholson, factoringcompare.com, 28/07/2009