When is Accounts Receivable Financing NOT a good fit for a business?
Generally factoring is not a good fit in the following situations: • Your business operates on extremely low margins (less than 8%). • Your business has significant cash reserves free of cash-flow concerns. • Your business serves as a sub-contractor to a less-than-established general contractor. • Your business involves Medicaid or Medicare-based accounts receivable. • Your business sells almost entirely to less than credit-worthy customers. • Your business has a significant amount of accounts receivable that are already overdue.
