By the numbers: A factoring example

· 7% of the available line of credit.

· Current annual revenue is $2 million.

· Capital availability through factoring is $1 million.

· Percentage of sales factored is 50%.

· Annual percentage sales increase without using factoring is 5%.

· Annual percentage sales increase when using factoring is 25%.

The accompanying chart reflects how factoring can profitably replace bank funding for businesses that can achieve more sales when provided with virtually unlimited cash-flow financing from factoring.

See the main story that goes with this article: Factoring: Jet fuel for attracting packagers