The top firms in terms of estimated annual factoring volume.

As the economy has deteriorated, banks have become increasingly reluctant to provide capital to small or midsize firms — the size of many U.S. apparel manufacturers and designers. Thank goodness for factoring, which keeps many of these businesses afloat. Factoring firms, which advance financing against sales, can be a more accessible source of lending because they are not bound by the banking industry’s financial covenant restrictions. Rather than evaluate the credit worthiness of companies based on net worth, liquidity, cash flow and profitability, factors look for the quality of accounts receivables.

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