Factoring has helped a great many companies solve their cash flow problems, and it’s a great way of getting cash in your hands quickly – without taking out any loans. Below are listed some of the industries which have benefited the most from factoring, and which continue to use the method for maintaining financial stability.
Construction companies frequently run into cash flow issues, often due to seasonal slowdowns and inconsistent consumer demand. Yet the cost of construction materials remains constant or increases, so these have to be dealt with in some way. Factoring had been a godsend to many companies in this industry, because it can smooth over gaps in cash flow.
Many manufacturing companies are plagued by rising material costs as well as transportation and fuel costs, and incoming revenues don’t always take care of those increasing expenses. With factoring, all these un-budgeted costs become much more manageable.
The mega pharmaceutical companies are probably exempt from this list, but there are literally thousands of small to mid-sized companies that struggle to meet expenses. This is usually because they have a poor credit history or have not been in business long enough, but either way, they’re considered a credit risk. Factoring ignores those criteria and can help small pharmaceuticals most of the time.
Having access to cash for growth and expansion is one of the biggest challenges to I.T. companies, and that can also make it difficult to meet payrolls and operating expenses. Factoring has helped a great many I.T. companies meet daily obligations as well as to have the funding necessary for expansion.
Some customers are notoriously slow in paying for their medical care, and that causes a bottleneck with revenues. In addition, healthcare companies are frequently obliged to scramble in order to meet new requirements and regulations which they are subject to, and that’s when factoring can help smooth out cash flow.
Even staffing agencies are subject to seasonal slowdowns, and but they are also forced to staff up in order to meet clients’ obligations at various times. These things can’t be handled by regular incoming revenue, but factoring can be the ideal solution to keep things going.
Slow accounts payable and seasonal highs and lows make cash flow an issue in the energy business, and that’s where factoring comes into play. Daily operating costs, payroll obligations, and even unexpected business opportunities can all be managed by factoring.
Would Factoring Benefit Your Small Business?
If you’ve been considering factoring as a means of generating income quickly, we’d like to hear from you. Contact us at Grecco Capital, so we can discuss some options available to you with regard to factoring.