Accounts Receivable Factoring Allows you to Take Advantage of your Biggest Asset (Part 1)

Posted by Wade Henderson

February 8, 2010

Ever taken a close look at the details in your financial statements? If you have, regardless if you are in manufacturing, service or wholesale, you will find that 40% to 70% of your assets are tied up in your Accounts Receivablewhat would happen if the accounts were to just disappear?

Precisely, your largest asset would be gone but your liabilities would remain the same.

Oddly enough, Accounts Receivables are often looked down upon, but in reality, they are a vital part of the company. This is all money waiting to be converted from credit sales accounts to cash. No further action is needed on these sales other than to collect. No more costs to produce the product, no shippingjust collection.

Accounts Receivable Factoring helps many companies convert this asset into much needed cash that can be used to generate more business.

The average business has 80% of its sales tied up in Accounts Receivables so there is a major concern here. Accounts Receivable Factoring can make the difference between making payroll or not.

Regardless of their importance, company owners will often consider Accounts Receivables to be little more than a thorn in their side and an inconvenience. Rather than treating them like a valuable asset, they rarely receive the respect they deserve. Accounts Receivable Factoring Companies whole business is Accounts Receivable Management so you will be assure of professionalism.

Oddly enough, this undesired department of the company will be left to resolve the problems that customers have with their product or service. They are essentially an internal collection company, not customer service, but they will come across many opportunities to save accounts and even create new once.

Unfortunately, credit and collection areas do not have a profile of customer service and handling complaints in order to address these scenarios and what is more, the way it measures its performance does not help at all in the proper handling of relations with the internal and external customers as they invariably are evaluated for days on average it takes receivable (DSO or Days Sales Outstanding) and the percentage of past-due loans (% Bad Debt) and this means that no matter what you have to do, collect as much as possible regardless of the customer relationship.

A Professional Accounts Receivable Factoring Company will make sure the accounts are handle properly, not a Collection Company but an Accounts Receivable Management Service.

Wade Henderson - recognized Professional - 15 yrs in the Business Finance Field - strong reputation for getting the deal done. IMMFinancial.com Factoring Companies Factoring Company

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