factoring companies will advance 80% to 90% of the total up front, and then provide your business the remaining amount 20% to 10%, less your discount fee, once the invoice is paid by your customer.
You are normally given up to 90 days for payment to arrive and if the payment does not arrive the factor will come back you for collection. It's important to keep in mind that today's factoring is mostly full recourse so you will need to manage the relationship with your customers and make sure payments still arrive within a reasonable time period. The good news is that is much less likely that the factoring company will pester your customers for payments and destroy your customer relationships. This allows factoring to wor
No comments:
Post a Comment