Factoring accounts receivables has become a valuable option for businesses that simply cannot wait to be paid by slow paying customers, but is it really worth the cost?
Let’s take a quick look at cost. When you decide to factor, your factoring company will set a rate, which is dependent upon several things, some of which are:
- Sales volume
- Invoice size
- The creditworthiness of your customers
- The number of creditworthy customers
- The length of your contract with each customer
- The number of days the invoice is outstanding