Building upon recent posts concerning cash flow, it seems that many companies are still taking longer than ever to pay their invoices. This is a dilemma for small businesses waiting on invoice payment to effectively cover operating costs.
Even though the economy is slowly recovering, many large corporations are still pushing smaller suppliers into long payment cycles of up to 90 days, threatening to back out of deals or find new sources if their demand for a 90 day payment cycle is not accepted. This can simply not be viable for some small businesses that do not have the sway to delay payment to their suppliers.
Before we launch into the benefits of factoring your accounts receivables, let’s revisit a few ideas that may help the payment process along.