Before the 20th century, factors were mercantile intermediaries whose main functions were warehousing and selling consigned goods, accounting to principals for the proceeds, guaranteeing buyers' credit, and sometimes making cash advances to principals prior to the sale of the goods.
Their services were of particular value in foreign trade, and factors became important figures in the great period of colonial exploration and development.
In 18th- and early 19th-century China and Japan, however, the governments limited European traders to small, defined areas: the Dutch Factory was allowed to operate on Dejima, an island off Nagasaki, before the opening of trade with Japan; and in China the British were limited to Thirteen Factories and Shamian Island areas of Canton.
For example, Banten, on the Indonesian island of Java, was from 1603 to 1682 a trading post established by the East India Company and run by a series of chief factors.
In Scottish law, a judicial factor is a kind of trustee appointed by the Court of Session to administer an estate, for a ward (called a pupil) until a guardian (called a tutor) can be appointed (factor loco tutoris), for a person who is incapax, or for a partnership that is unable to function.