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Factoring as a Financial Alternative for Development of Companies: Evidence from Bulgaria

Author

Listed:
  • Galya Taseva-Petkova

    (University of National and World Economy; Economic Research Institute – BAS, Sofia, Bulgaria)

Abstract

The aim of the article is to investigate the existence of a dependence between the use of factoring by the companies in Bulgaria and their financial condition and development opportunities. The analysis is based on data from an empirical sociological survey among 1000 non-financial enterprises with different main activity and size. The study by the methods ? - square and non-parametric dispersion analysis (Kruskal-Wallis test) shows the existence of consequential relationships between the use of factoring and selected indicators of financial condition and opportunities for enterprise development. Such indicators are: the turnover of firms; the growth of added value; reducing the cost of each production unit; investment and innovation activities of firms. It can be concluded that companies using factoring generally have better financial indicators, they are more innovative and have higher investment activity, which creates better opportunities for their development.

Suggested Citation

  • Galya Taseva-Petkova, 2017. "Factoring as a Financial Alternative for Development of Companies: Evidence from Bulgaria," Business & Management Compass, University of Economics Varna, issue 3, pages 252-266.
    • Handle: RePEc:vrn:journl:y:2017:i:3:p:252-266
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    More about this item

    Keywords

    factoring; trade credit; financial situation of enterprise; investments; Bulgaria;
    All these keywords.

    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • G31 - Financial Economics - - Corporate Finance and Governance - - - Capital Budgeting; Fixed Investment and Inventory Studies
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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