Factoring is a Better Choice - Academic Research Claims Legislation is Against Small Businesses
An educational study of the Federation of Small Businesses in Britain has demonstrated that the legislation intended to punish late payers and help home businesses are actually being used against them by larger companies that are on the lookout for rewards from soon settling bills.
4,000 business screw ups were caused by overdue payments last year and research among its members found one in 3 were waiting longer to be paid since the start of the credit crisis, with waiting times being stretched as long as 4 months.
However the state’s smallest corporations, hit hard by the liquidity crisis and the recession, are experiencing a tentative recovery. A survey of 4,400 FSB members performed at the end of May 2009 revealed that 57 % were “quite confident” about the future prospects of their business, while 68 per cent said that they intended to grow in the next 6 months.
One expansion methodology that small businesses all over the world can use to grow is factoring.
Some businesses have discovered that factoring keeps them current with payroll, supplies, and bills and helps them avoid late fees so that the business keep producing, helping them remain in business.
**Accounts receivable factoring is not a loan but rather a discounted purchase price for existing accounts receivable (or fulfilled invoices) available to B2B companies.
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