Texas Commercial Factoring

Written by Patricia Tunstall
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Factoring is a growth industry on a worldwide scale, and as banks increasingly become a part of this industry, factoring gains in credibility and stature. Although invoice discounting--factoring--is an integral part of the financing of huge corporations, this financial arrangement has not been widely offered to small- and medium-size businesses until recently. In fact, there is hardly an industry or field that could not benefit from factoring, as its advantages are not specialized or directed at any one area of the business world.

Factoring Spreads to the States

In the United States, factoring is most closely associated with the apparel and textiles industries. Insiders estimate that 60-70 percent of factoring dollars in North America come from these trades. Most factors, especially the larger ones, are based in New York and Los Angeles, which is where the apparel and textiles industries are headquartered.

As banks and financial institutions throughout the United States take up the cause of accounts receivable financing, smaller businesses recognize the many benefits of this practice. Texas commercial factoring is one example of the spread of factoring outside the coasts. Aside from the cash advances, factoring means that businesses do not have to invest a lot of money in invoicing systems and collections departments. Part of factoring services is setting up and monitoring accounts receivable so the smaller business owners can concentrate on other important matters.

Once a business has invested in expensive invoicing and collections systems, it is reluctant to turn to factoring because it means lost expenditures and possible layoffs. The time to investigate factoring is now, before such elaborate departments are realized. This is another important savings that factoring can bring to businesses in any trade, profession, or industry.

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