Why Choose Factoring | Factors Southwest

Why would a business consider factoring?

A company wants the ability to grow sales without being limited by a lack of working capital.
A company is profitable but is occasionally short of cash.
A company has too much of money tied up in 30, 45, 60 day terms to customers.
Would your business benefit from a "credit line" based on your receivables (and no other collateral) which you could draw upon when needed? Imagine the only limit to capital is your ability to sell! Now companies can have access to working capital they need for growth or survival.

Accounts Receivable funding (Factoring) is designed for businesses that want to improve their cash flow by not waiting 30, 60, 90 days for a customer to pay. Factoring is used in almost every industry today that sells business-to-business or business-to-government.
Factoring is similar to a line of credit except invoices are advanced upon at the time the invoice is created. It's the same concept as offering a discount for early payment of your invoice (1% 10, Net 30 days), except money can become available in 24 hours or less and does not depend on if a client wants to pay early.
New businesses and fast growing companies have a huge demand for cash. Chances are their sales are growing faster than they can collect from their customers. Until growth levels off, they can never catch up! Without factoring these types of business would ultimately fail.