Manufacturing Growing For 25 Straight Months

Manufacturing

Here is one piece of good news. According to the ISM index, manufacturing has been growing for 25 consecutive months. Although experts consider manufacturing to still be weak, at least it is in positive territory. Manufacturing is a critical industry for the country so it's definitely good that it's growing, albeit slowly.

Coincidentally (perhaps?) we have seen a small increase in the number of small manufacturers that are looking for business financing. Many of these are looking for business loans or lines of credit to be able to operate their businesses. Some, need the funds to pay suppliers in order to handle a large PO. Their challenge is that few institutions are issuing business loans. For the meantime, they are bridging their financial needs using factoring.

Factoring helps manufacturing companies by providing an upfront payment for their slow paying invoices. Instead of waiting up to 45 days to get paid, they get a payment from the factoring company and get immediate use of those funds. The transaction is settled once the customer pays in full.

The big advantage of invoice factoring in this case is that it's easier to obtain than a conventional business loan. This helps the company bridge their cash flow gap and improve their financial stability. Ideally, this will help them qualify for a business loan later on.