For starters, Factoring is not new. It’s been around for several hundred years and that in itself is a surprise – particularly to small and mid-sized companies who habitually look for traditional financing via a bank. Large and very well known publicly listed companies factor all the time.
The business has decided to rationalize its cash flow in order to guarantee future expansion. The fact that you are not using a traditional bank, but private financing, shows that the company is financially attractive. It therefore has a range of financing options.
The customer’s payment terms will not change.
The customer will still have the routine contact with the business and its personnel. Nothing will change there.
All the business invoices to the customer will come via the Factoring company, with a written instruction that the customer is to make full payment on that invoice direct to the Factoring company.
The Factoring company is not a collection agency, but they will be providing real time online status of unpaid and paid invoices to the business. This will allow the business to objectively monitor its cash flow from all or any of its customers.
© 2007 Sanjeev Aaron Williams & Cashwerks All Rights Reserved
The business has decided to rationalize its cash flow in order to guarantee future expansion. The fact that you are not using a traditional bank, but private financing, shows that the company is financially attractive. It therefore has a range of financing options.
The customer’s payment terms will not change.
The customer will still have the routine contact with the business and its personnel. Nothing will change there.
All the business invoices to the customer will come via the Factoring company, with a written instruction that the customer is to make full payment on that invoice direct to the Factoring company.
The Factoring company is not a collection agency, but they will be providing real time online status of unpaid and paid invoices to the business. This will allow the business to objectively monitor its cash flow from all or any of its customers.
© 2007 Sanjeev Aaron Williams & Cashwerks All Rights Reserved
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