This case deals with the use of factoring in international trade to improve a company's liquidity position and reduce its exposure to payment risk. Korean Plastics Company (KPC) is a large company that supplies products globally, including many developing countries. The company is facing a serious liquidity problem that has been caused largely by a slowing of its accounts receivable collections, specifically from developing countries. The CFO of the company is considering the use of factoring as a means of mitigating this risk and improving cash flow for the company
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