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Poll: When invoicing, do you use factoring services?
Thread poster: ProZ.com Staff
ProZ.com Staff
ProZ.com Staff
SITE STAFF
Oct 9, 2021

This forum topic is for the discussion of the poll question "When invoicing, do you use factoring services?".

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Paul Dixon
Paul Dixon  Identity Verified
Brazil
Local time: 10:52
Portuguese to English
+ ...
What are factoring services? Oct 10, 2021

What are factoring services?

Bajram Djambazi
Ines Radionovas-Lagoutte, PhD
Kuochoe Nikoi-Kotei
Michael Harris
deseji
svetlana cosquéric
Adieu
 
Kevin Fulton
Kevin Fulton  Identity Verified
United States
Local time: 09:52
German to English
Selling invoices at a discount Oct 10, 2021

Paul Dixon wrote:

What are factoring services?


In very broad strokes ...
Factoring services are useful for companies with uneven cash flow, for example in the garment manufacturing business when most income comes in late in the year, or physicians with large practices who receive substantial insurance reimbursements (or in the US, Medicare/Medicaid payments) on a delayed basis. The factor advances a portion of the receivables to their client and retains the rest as a factoring fee. There are very few translators – if any – who have turnover levels that would be of interest to a factoring company. Factoring companies decide their rate based on the quality of the receivables (billing to insurance companies, Fortune 1000 companies, etc.). Money owed by the typical mom and pop translation shop wouldn't interest a loan shark much less a factoring company.

Maria Teresa Borges de Almeida
Kuochoe Nikoi-Kotei
 
Maria Teresa Borges de Almeida
Maria Teresa Borges de Almeida  Identity Verified
Portugal
Local time: 14:52
Member (2007)
English to Portuguese
+ ...
Never Oct 10, 2021

Like everybody else in this business over the years I had my highs and lows and everything in between but never had a serious cash-flow problem and if I had I would rather ask my bank for a loan than use a factoring service.
 
Mario Freitas
Mario Freitas  Identity Verified
Brazil
Local time: 10:52
Member (2014)
English to Portuguese
+ ...
Never Oct 11, 2021

If you need to advance payments only 30 or 60 days, this is a big sign of financial disorganization. You must bear in mind that you only advance your payments ONCE. From that point on, you'd be living as you should have been before engaging a factinring service, but you'll be paying interest and fees evey single month for all payments you advance.
Once again, a good way to thow money in the trash can.
 


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Poll: When invoicing, do you use factoring services?






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