The cash conversion cycle (CCC) measures how many days it takes a company to rec

The cash conversion cycle (CCC) measures how many days it takes a company to receive cash from a customer from its initial cash outlay for inventory. For example, a typical retailer buys inventory on credit from its vendors. When the inventory is purchased, a payable is established, but cash isn’t actually paid for some time. The CCC is most effective with retail-type companies which have inventories. Consulting, software, insurance companies are example where the CCC isn’t useful. The cash cycle has three distinct parts. The first part represents the current inventory level, the second part represents current sales and the amount of time it takes to collect cash from sales on account and the third part represents current outstanding payables. The lower the cash cycle the better, so a negative cash cycle is very desirable. One of the ways a company can reduce the time to collect cash from sales on account is through accounts receivable or invoice factoring.
Point your browser to www.quicksprout.com and scroll to “Finance” and “Compare the Best Invoice Factoring Companies”, click on the link and you will see, The 9 Best Invoice Factoring Companies of 2023. Your assignment is to explore the this site or the Web and other sources to answer the following questions: 1) What is factoring (accounts receivable factoring), but not a definition per se, what is the purpose, what does it do, 2) How does the process of factoring work (describe steps in a factoring process, use a graph as well) and 3) if you owned a business, would you use a factoring service? What are the advantages and/or disadvantages?
Reflection – the students also should include a paragraph in the initial response in their own words reflecting on specifically what they learned from the assignment and how they think they could apply what they learned in the current environment or workplace.