Advantages of Factoring
Main advantages to be provided by means of the factoring transaction to your firm are as follows;
Thanks to the resource you obtain by way of factoring, you may increase your competitive power, and amplify the volume of your business by way of offering more feasible terms of sale.
You may benefit from your suppliers’ discount opportunities thanks to the resource to be obtained by way of collecting your receivables arising from your credit sales before the due dates thereof.
You may not only solve your shortage of cash without resorting to bank loan, you may also affect your liquidity positively.
Follow-up of the collection of not only your clients’ invoices, but that of the checks and notes thereof is also undertaken.
Factoring transaction causes activity only in the assets section of your balance sheet. Receivables, stocks, and commercial debts are decreased, while the operating capital being generated by the enterprise is increased. Your balance sheet becomes more liquid, and the credibility of your enterprise thereby improves.
By way of transferring such issues as collection, funding to the Factoring Company, you may thereby focus more to such issues as marketing and investment, which are essential for the growth of your enterprise.
You may spend your time more on management and development, and less on collection and finance management. While such processes of yours as collection, follow-up thereof, and accounting are to be executed by the factoring company, you may thereby spend more time on amplifying your sales and production.