Factoring Financing Companies Seeking Cash Fast（保理融资公司寻求现金快）.pdf

The Entrepreneur’s Guide to Financial Maturity ® Factoring - Financing for Companies Seeking Fast Cash A healthy cash flow is an essential part of any successful business. Some entrepreneurs claim that a healthy cash flow is even more important than a businesss ability to deliver its goods or services. That may be viewed as obsessing on cash flow, however, if a company fails to satisfy a customer and looses that customers business, it has to work harder to satisfy the next customer. If a company fails to have sufficient cash to pay its employees, suppliers, creditors, or, they are out of business. One cannot overemphasize the importance of proper cash flow management when establishing, growing, or positioning a company for sale. A financing option available to companies of all sizes, whether a business is growing, “holding its own” or having a cash crunch, is factoring. Factoring, the process of purchasing accounts receivable from a business at a discount, has been utilized as a cash management tool for generations. Most business people are involved in factoring almost every day, if they use or accept credit cards. Visa® and Mastercard® are the worlds largest factors. When a customer purchases a good or service using a credit card, the merchant immediately discounts the invoice by 2% to 5% and immediately receives funding. Widespread usage of factoring in North American started in the 1600s. Colonist understood that in order to sell cotton, furs, and timber in the European marketplace, they needed to shorten the cash flow cycle. The entrepreneurial Colonists recognized cash outflows (payment of expenses) and inflows (collection from a sale) occur at different times, with cash inflows generally lagging b