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Factoring can be a beneficial form of financing for most any industry, especially ones where accounts receivable realization does not match operational needs. In other words, industries where large proportions of invoices are not paid in time to meet payroll or other debt obligations. Some of these industries include:
BUSINESSES IDEAL FOR FACTORING:
- Manufacturers
- Import
- Defense Contractors
- Communications
- Temporary Employment Services
- Janitorial Services
- Transportation
- Computer Hardware/Software
- Consulting
- Distribution
- Food
- Professional Services (Financial, Legal)
Basically, if a business makes or sells a product or delivers a service to a credit-worthy commercial customer on trade terms, that business is a candidate for factoring. Allieds clientele share the following traits:
- The need for working capital to support operations required for revenue growth (e.g. marketing, product development, payroll, accounts payable).
- Periodic cash flow pressure due to seasonal demand or unexpected sales is experienced more than 2-3 times per year.
- For any number of reasons, do not possess or choose not to possess traditional bank credit lines to support operational growth.
- The need for accelerated receipt of outstanding invoices.
- The desire to take advantage of trade discounts or other long-term sensible financial investments.
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