Pledging seems like a last chance effort to save your business. Shouldn't a business owner really consider profit margins before using this technique? What is the point if at the end of the month, the 10% that is paid out gives you a negative profit margin?© BrainMass Inc. brainmass.com June 4, 2020, 2:47 am ad1c9bdddf
Although considering profit margin is important, there are more types of financial statistics to consider because any financial analyst would consider more than one statistic before making a decision. With pledging, the collateral or asset used could be confiscated at the end of the month, however, that ...
This solution explains why companies that are doing poorly will resort to pledging.