We are constantly in a situation of choice – what kind of yogurt to eat for breakfast, if to go to work on the metro or on your own car, if to buy a DVD or watch a new film in the cinema, whether to go on holiday to Spain or go camping in the mountain. And every time you make this or that decision, you are guided by very definite considerations.
The Complications
In business, you also constantly face the need to choose, however, the level of responsibility and the magnitude of the risk is much higher. The choice of a factoring company is no exception. Moreover, given that many businesses make this choice for the first time, the situation becomes more complicated – the first time is always more difficult. To clarify the selection process and, perhaps, to protect someone from mistakes, experts decided to talk about how companies choose to themselves a provider of factoring services. In factoringcompanyguide.com you will be having the best deal now.
The need
Strange as it sounds, but first of all the company needs to realize the need for factoring. The presence of a wide range of buyers who regularly buy goods with a delay is, of course, a key characteristic of the trading activity of the company that needs factoring, but practice shows that it is not the only one. Usually,factoring is needed when changes take place in a relatively stable life of the company – customers ask for an extension of the grace period, the company itself enters new customers or refuses to work with large distributors in favor of a large number of small buyers.
- In this case, due to changes in the buyer – the emergence of a shortage of cash to work on prepayment, there was a change in the supplier – the risk of delinquency on the part of the debtor. The events that occurred resulted in the realization of the need for factoring, and, on both sides. The buyer requires a deferred payment and the supplier. It is a resource that allows avoiding cash gaps.
- After understanding the need for factoring, of course, it makes sense to consider alternative solutions, lending for goods in circulation, overdrafts, credit risk insurance and finally, own resources. Yes, if there is an opportunity to find a solution inside, then, naturally, this is what should be done.
- When the choice in favor of factoring is made, it is necessary to determine with which factoring company to work. It is from this choice that the final result depends – the achievement of the goal that the company sets itself before itself, taking the decision to use factoring.
What distinguishes one factoring company from another?It would seem that everything is simple, a set of products and technical capabilities to provide services. In fact, the main difference is the ability to satisfy certain customer needs. This is what factoring offers
