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11/20/2019

How factoring can help your consumer electronics company meet today’s needs

More than ever, consumers are relying on their electronic devices to stay connected in this new normal. Whether your focus is on smartphones or smart TVs, digital cameras or desktops, vendor costs can have a significant impact on your company. Taking steps to control vendor costs can be a key factor in day-to-day management and long-term growth.

Reducing vendor costs 

Managing vendor relationships can be a challenge, and negotiating with multiple vendors can take a toll on your efficiency and stand in the way of developing key partner relationships. Working with one experienced team that has the expertise to provide such services as accounts-receivable (AR) factoring and supply chain finance (SCF) is one way to minimize costs.

Understanding consumer electronics factoring

AR factoring can help reduce vendor costs while providing the peace of mind that accompanies being paid for credit approved and undisputed invoices. For consumer electronics companies, it generally works this way:

  • The factor advises whether it can credit-approve orders from your customer
  • You sell consumer electronics to your CIT credit approved customer
  • You sell your receivables due from your CIT credit approved customer to the factor.
    The factor collects payments directly from the CIT credit approved customer and remits these collections, less any applicable fees, to your company.

SCF services, meanwhile, can provide your business with extended payment terms, improved days of payable outstanding, lower purchase prices and reduced supplier risk. 

More options to streamline your business

AR factoring and SCF are just two of the options a trusted partner can offer to help you streamline costs. Others include:

  • Credit protection
  • Accounts-receivable management
  • Bulk purchase of accounts receivable
  • Receivable exposure management
  • Export factoring

Leaving factoring and finance issues to an experienced financial provider can give you back the time you need to deliver the electronic products your consumers need, right when they need them most. 

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