While an international factoring group will have a focus on factoring of accounts receivable, there may be a range of other services offered as well. Factoring, or the funding of a percentage of accounts receivable to advance cash to the company for inventory, production or expansion, is common for both international and domestic sales.
A few of the top companies that operate as an international factoring group will provide an extended set of services. These may be focused on both international as well as domestic sales, helping a business in many different markets.
Export Insurance
A good international factoring group is often approved by the EX-IM Bank to offer their export insurance program. This is designed to allow businesses to obtain loans from their lenders and financial institutions by providing insurance for the sale, which covers issues such as default of the buyer, bankruptcy of the buyer or even political issues that can complicate payment and collection.
Providing Collections
For domestic sales, which are also a part of most companies engaging in international business sales, a factoring group can provide domestic collection on credit sales as well as collect payment on international credit sales.
This is an ideal way to free up your business, particularly the accounts receivable office and accounting office. The factor will manage all payments on the accounts receivables they hold, allowing you to focus on growth and new markets.
Moving into New Markets
With funding available within just days instead of months, a business is uniquely poised to take on new contacts and to expand into different markets. This is often the additional support that a company needs to quickly move into a new geographic area and corner a market.
Not only is this good for the individual business, but it also creates better options for other businesses in the United States as well. As US products become known in international markets, the demand for more US imports continues to grow.
