Archive for the ‘Business’ Category

Long Term Support for the Best Factoring

Thursday, July 5th, 2018

Typically, factoring is a short-term financing technique that involves a company entrusting the management of its trade receivables to a financial company called factor. Still unknown to business leaders, it has many forms and is now an ideal tool to finance its cash.

How factoring works

Depending on the terms of the factoring contract, the financial company buys the unpaid invoices from the company and proceeds to the recovery of the receivables on behalf of the company, for a commission which is levied at the time of the purchase of the invoices and a guarantee against the risk of unpaid bills. This commission, which consists of the cost of managing the customer item and the cost of financing, represents the factor’s remuneration. While the first cost is proportional to the amount of the bills not yet due to be managed, the second represents an interest rate of the contribution granted. The factor company is important in this matter.

Thanks to the factoring technique, the company has a cash position which was then in the form of receivables that have not yet fallen due and optimizes the management fees of its receivables, because all the management is transferred to a third entity to which only a commission is paid in lieu of labor costs and administrative costs.

With the diversity of customer needs and the evolution of the markets, variants of the classic factoring offer exist to respond specifically to the different expectations of companies. Thus we can denote techniques such as factoring, import / export factoring, confidential factoring, managed factoring and unmanaged factoring, factoring of purchases, factoring of balance and reverse factoring.

Fixed-price factoring

Flat rate factoring is a variant that differs from conventional factoring in the remuneration of the factoring company, in terms of the cost of managing the receivables only. With fixed-rate factoring, the remuneration of the management of the customers and the recovery of the receivables is fixed according to a fixed amount to be paid according to a precise periodicity, whatever the amount of the invoices not yet due, which are presented to him, during all the duration the factoring contract. The main advantage of this variant is that the company that benefits from it knows the amount of the service in advance. But at the same time, the major disadvantage is that even if you do not have any bills not yet due to present to the factor, the

Export Factoring and Import Factoring

Export factoring is reserved for the financing and management of invoices issued to international customers. As for import factoring, it allows the company to obtain financing for its foreign purchase and import operations.

 

While export factoring is similar to conventional factoring with the only difference that customers are foreign, for factoring import is a little more complicated. Here, it’s about having a product delivery for which you are sourcing abroad, to a local customer. The factor pays the strange supplier and delivers the goods to the local customer and proceeds with the collection of the claim. The factor pays you the amount of your claim before or after the payment of the customer by taking the commission, according to the terms of the factoring contract. With export factoring, the company ensures at the same time that its customer will always be supplied, that its supplier will always be settled in time and that it will always benefit from its commercial margin. This technique can be used to deliver imported products to a local market even without having cash.

Choices for the Load Boards Right Here

Thursday, July 5th, 2018

For the transport of goods or even containers, it is also possible by the railway. Companies often provide transportation whether or not the owner of the goods has wagons. It is often the large goods that must be shipped by iron.

The coverage area depends on the service provided by each company, which covers in particular national and European routes. For the truck loadboards for free this is important. Depending on the weight of the goods and the specificity of the sector of activity of the company that leases the service, there are 3 main types of services in rail transport:

  • The transport of goods: in whole trains or in isolated wagons.
  • container transport
  • truck transport

Transport by the railroad voice has assets, apart from the tonnage it can carry, such as respect for the environment. Indeed, rail transport respects the environment more than other modes of transport because the emission of greenhouse gases is minimal (1.4% of CO 2 emissions against 90% for the road). That is why this mode of transport is encouraged in Europe but also around the world.

There is also the energy consumption: as the experience shows, the energy efficiency of the railways is twice as high as that of the road, or more. For example, with the energy equivalent to 1 kg of oil per tonne of goods, a transport truck travels up to sixty kilometers while a train runs one hundred and ten.

  • Nowadays, transport is very important for humanity. Freight transport is the transfer of goods between a manufacturer or seller and a buyer or receiver.
  • It can be done in different ways, and the main types can be summarized as follows:
  • Land transport is: Global road transport, national road transport and rail transport. There is also transportation by boat and transportation in the air.
  • In the same way, transportation is done with trucks, trains, ships and the airline.
  • And the usual use of these transports is the inter porto, the stations: the freight terminals and the marshalling yards, the ports, the airports and the container terminal
  • There may be crime and theft of goods in the transport and freight sector. The majority of truck thefts on the road or in company premises usually happen in the evening or on weekends.

How to secure your goods

Prevention starts with recruiting your staff. Make sure your employees are reliable and honest and trustworthy. To do so, you can call his previous employers and ask for all possible information about him. Then, give your employees a self-defense class.You can also put security tags to protect your merchandise from theft.

True Options for the Reverse Factoring Now for You

Friday, May 25th, 2018

Factoring is an operation for the sale (assignment) of a receivable to a supplier of a factor company, carried out with the objective of immediately receiving cash and providing liquidity. Usually, a portfolio of debts is transferred to the factor company, which is associated with additional risks and the need for a thorough analysis of the position of each debtor. Reverse factoring is, according to the authors, a less expensive liquidity scheme for the supplier. First, reverse factoring is focused on the buyer and, accordingly, the laboriousness of analyzing information about debtors is reduced, which allows reducing the cost of the operation. Secondly, since the companies that carry out investment activities often become buyers, the risk is significantly reduced and it becomes possible to lower interest rates.

Smart Options for the Proper Results

In short, the reverse factoring scheme looks like this. The buyer sends the order to the supplier and notifies the factoring company (usually the bank acts as a factor). Further, the supplier provides relevant documents to the company-factor, which conducts the audit and notifies the buyer. The buyer agrees or disagrees with the terms, about which the supplier receives notification. If the supplier requests payment without delay, the factor credits its account. At maturity, the factor debits the buyer’s account.

The Right Custody

However, the authors say, the chain of custody financing scheme has not received adequate distribution, which they relate primarily to the lack of confidence in its advantages and reliability. According to the results of these studies, in companies that applied the reverse factoring scheme, the working capital was reduced by an average of 13%. Suppliers of reverse factoring ensured a reduction in working capital by an average of 14%. Effective use of the chain of custody financing scheme involves the use of special software, investments into which, according to the calculations of the researchers, are repaid repeatedly in the first year of use.

Proper Results for the Reverse Factoring Now

In addition, reverse factoring has also positive aspects such as standardization of terms of payment (57% of respondents noted), improvement of relations with consumers (52% of respondents), improvement of processes covering the placement of orders, purchases, acceptance, payment and accounting of goods and services (68% of respondents), improvement of the chain of processes from order to payment of goods (14% of respondents), as well as from registration to reporting (14% of respondents).

Any change, however beautiful it may be at the level of the idea, must be correctly implemented to bring the expected positive changes. The authors identify three main factors responsible for the success of the introduction of the supply chain financing system.

Categories
Bookmarks