Companies that engage in a successful factoring relationship tend to have greater financial flexibility and, thus, greater operational flexibility as the availability of cash expands with growing sales. Businesses will use the financing obtained from factoring not only to meet short-term demands, but also to expand operations and take on larger accounts.
Purchasing managers may find contract packagers that use factoring are more accommodating when offering extended payment terms.
See the main story that goes with this article: Factoring: Jet fuel for attracting packagers