Sell account receivables is where your A/R and open invoices are your most valuable asset. You sell your open invoices at a small discount and you get the cash now.
- You don’t give up equity as with investment capital or new partners.
- You can take advantage of supplier early payment and volume discounts.
- You have the ability to make volume purchases from suppliers.
- No more offering early payment discounts to customers.
- Elimination of your bad debt. Factoring is non-recourse.
- No additional debt, factoring is not a loan. (off balance sheet)