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Patty Hirsch, a senior editor at Marketplace, discusses factoring as a financing method for small businesses. The recent news about CIT, a major factor, has raised concerns among businesses about potential financing shortages. Hirsch explains how factoring works using an example of a shoemaker named Sam who sells shoes to Nordstrom. Sam ships 20 pairs of shoes to Nordstrom each month, which Nordstrom buys consistently.
