Factoring receivable invoices is the sale of an asset - your company's invoices. The sale of your invoices to a third party - known as a Factor - eliminates the sale-to-collection business cycle of waiting for a customer payment. Usually, factoring companies will purchase your invoices for up to 90% of the total amount. You get your cash now and the factor takes on the risk of collecting the payments from your customers. The creditworthiness of your customers is very important if you want to get a good rate from a factor.

What are the specific advantages?

• Immediate cash with no waiting and without incurring new debt: You receive quick payment following invoicing.


• To factor, your business credit rating is not an issue because you are not borrowing money


• Efficient handling of all your invoicing and data entry


• Relief from the responsibility for collecting no-pay and slow-pay clients


• You have expanded growth capacity through…

This is an actual problem I faced at an actual customer of mine a few months aback and posted today on message board that I belong to (http://tech.groups.yahoo.com/group/GP_eEnterprise) . It seems that more often than one could assert, customer records get assigned to the wrong national account (or parent account). This can cause problems down the road when incorrect statements or agings are submitted to the corporate customer. Oh boy! Those angry calls from the AP department of this, your multimillion dollar account,…