Factoring Accounts Receivable

Over the next Several Weeks we will be posting a new and different one-minute video providing business tips and instructional commentary for small business owners.   These tips will range from key metrics to consider to the importance of Business and Cash Flow Forecasting.

Selling your accounts receivable today, at a discount before the receivables are collected is called factoring.

There are 3 things that need to be present before it is a good idea to factor

My name is Michael Barbarita from Next Step CFO with the Know Your Numbers Minute.  

Those 3 things are:

First, The Company has growth opportunities that they have identified

Second, The Company has solid and consistent profit margins; and
Third, the company has customers who pay on time.

And remember, the most successful business owners know their numbers.

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