Landscape Contractors: Now Manage the Cash Flow by Invoice Factoring

In its classic form, Factoring is a financial transaction in which a company sells the amount of its claims against its customers on a given date (that is to say, the balances on bills yet due) to a third party (called the factor), which pays that amount by skimming off fees and commissions. Many factoring companies exist in the financial centers of Sunnyvale. Conventional financial institutions, having understood that this funding means could take their market share in view of the clear benefits it presents, created subsidiaries specialized in the provision of factoring services. For contractors also, it can be a boom to their business.

Financing of construction activities, public works and construction

Through work situation and billing 2 types of billing may be funded by factoring, work situations and interim bills.

1. Billing form of work situation: Invoice edited according to the progress and expressed as a percentage or made??lots.
2. Billings for construction sites of several months, with bills edited late, usually from 20 to 25.

Documents requested by the factoring company

• Location verified and validated by the first contractor and subsequently by the client (client) before presentation to the paymaster for settlement.
• General Final Countdown (DGD), document accepted and approved without reservation by the client at the end of construction.

Time validation

The deadline for the validation and settlement of cases is 45 days, cut into three periods, 15 days to verify the situation of the contractor, then 15 days to confirm the situation by the client, and 15 days even for settlement by the paymaster.

Deadline for submission to the factoring company

The situation is given to the factor for funding after having been checked and approved by the project manager or in the first 15 days.

The advantages and disadvantages of factoring

Companies are increasingly turning to factoring as it allows them to get money quickly instead of waiting times admitted customer payments which are generally between 30 and 60 days after the issuance of the invoice. After sending an invoice to a factoring company, the company can receive the balance of the receivables less the commission of the factor and a security deposit within 48 hours.

Another advantage of factoring is that it is adapted to the current operating business financing. Indeed, factoring is cheaper than cash advances from banks and do not disrupt the financial structure of the company that takes place when they are used to finance working capital needs.

For more information about Invoice Factoring Please visit www.invoicefactoringus.com

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