Invoice factoring can be a valuable financial tool that helps businesses manage their cash flow effectively. Invoice factoring involves selling unpaid invoices to a third-party company, known as a factor, at a discounted rate. This allows businesses to access a significant portion of their accounts receivable immediately, rather than waiting for their customers to make payments. By converting unpaid invoices into immediate cash, businesses can meet their immediate financial obligations, such as paying suppliers, covering payroll, or investing in growth opportunities.