Accounts Receivable Financing- Secrets

The Merriam-Webster Online Dictionary definesaccounts receivable financing is transparent to the
"secret" as:ultimate customer.
"1 a: kept from knowledge or view : hidden b:The third secret- "designed to elude observation
marked by the habit of discretion : closemouthedor detection" has to do with your business plan
c: working with hidden aims or methods :and how the way you think about the world can
undercover d: not acknowledged : unavowed e:affect your success. In 2006 Prime Time
conducted in secret 2: remote from humanProductions produced a film and a book called
frequentation or notice : 3: revealed only to the"The Secret". The film dramatically describes the
initiated : esoteric 4: designed to elude observation"Law of Attraction" which asserts that people's
or detection 5: containing information whosefeelings and thoughts attract real events in the
unauthorized disclosure could endanger nationalworld into their lives. Can your feelings and
security".thoughts attract more business and success? Is
As used in this article, secret means: revealedthe visualization of what you want an aid for
only to the initiated; kept from knowledge ormanifesting your business goals? Is The Secret
view; and designed to elude observation or"just a new spin on the very old (and decidedly
detection.not secret" The Power of Positive Thinking (a
The first secret- "revealed only to the initiated"book by Norman Vincent Peal written in 1952)
relates to the fact that most schools, evenwedded to 'ask and you shall receive' -as opined
business schools, do not teach the subject ofby Karin Klein, editorial writer for the Los Angeles
factoring or purchase order financing; most banksTimes? Did The Secret fail to discover the real
do not offer these financing facilities as products.roots of powerful thinking?
Therefore, it is not surprising that manyIn the book, "The Diamond Cutter", Geshe Michael
businesses are unaware of the cash potential thatRoach examines The Budda on Managing your
lays dormant in their business invoices.Business and your Life. Roach graduated from
Let's suppose you own a small to mediumPrinceton University with honors, studied the
business and you depend on customers payingancient wisdom of Tibet and traveled to the
invoices within a 45-60 day period for yourTibetan Lamas at the seat of His Holiness, the
working capital. In essence, you are extendingDalai Lama. In 1983 he took the vows of a
credit like a bank to your customers. For thatBuddhist monk.
period of time your cash is tied up in yourHis teacher encouraged him to enter the world of
invoices- your accounts receivable. This limitsbusiness. Mr. Roach choose the diamond business.
growth and may create problems regardingHe hid the fact that he was a monk and
meeting payroll and paying your suppliers.maintained a façade of a normal American
Accounts receivable financing is the process ofbusinessman on the outside. The business
selling your invoices for cash as soon as they aredeveloped from nothing to a one hundred million
issued which allows you to make more effectivedollar per year business.
use of your assets. Purchase order financing isThe original book, "The Diamond Cutter" is the
the process of obtaining a third party"oldest dated book in the world that was printed
commitment to pay your suppliers as soon asrather than being written out by hand. The British
products are received by your clients (in advanceMuseum holds a copy that is dated A.D 868." It is
of payment by you or your client), based on thea written record of Buddha teachings from over
surety of an accounts receivable financing2,500 years ago. In brief, the central principles are:
arrangement.1) business should be successful and make money
All businesses are limited in their growth andin a clean and honest way; 2) you should enjoy
profits by the amount of capital and cash flowthe money and stay in good health; and 3) you
available to take advantage of businessshould be able to look back ay your business and
opportunities. The availability of virtually unlimitedsay your years of doing business had some
cash creates a powerful paradigm for potentialmeaning leaving some good marks in the world. I
growth. It also can expand your thinking abouthighly recommend "The Diamond Cutter" vs. "The
what business is possible and how you might goSecret".
out and develop new business.The bottom line: accounts receivable financing and
The second secret- "kept from knowledge orpurchase order financing may be the secrets to
view" relates to the practice of non-notificationyour business' financial success. If you read and
factoring. Some business people are concernedfollow the principles of "The Diamond Cutter" you
that working with a factor, an accounts receivablecan expand your opportunities for exponential
financing company, may not be viewed favorablygrowth based on the 2500 year old teachings of
by their customers. In many cases it is possible toBuddha, as explained by Mr. Roach.
structure a transaction legally so that the