Cortesi Construction
33644 8th St Union City CA 94587
510-952-9999
cortesiconstruction@comcast.net

Cortesi Construction is a Family Owned and Operated Company with over 20 years of Experience specializing in any Home Improvement or Construction service such as; Kitchen Remodeling, Bathroom Remodeling, New Construction, Roofing, Countertops, Plumbing, Flooring, Tile, and more.

Established as a Company since 1991, Cortesi Construction is #1 in customer satisfaction, offering experienced, reliable, and fast service to ensure we don’t waste your time or money. All Work comes with a 100% customer satisfaction guarantee. While Projects are ongoing there is always on site supervisor making sure the job gets done right and just the way you like it.

We offer free estimates and references upon request. 

We Are The Handyman Experts, Call The Experts, serving the areas of Union City, San Francisco, & Fremont CA. CA General Contractors License # 818945.

Cortesi Construction
33644 8th St Union City CA 94587
510-952-9999
cortesiconstruction@comcast.net

Cortesi Construction is a Family Owned and Operated Company with over 20 years of Experience specializing in any Home Improvement or Construction service such as; Kitchen Remodeling, Bathroom Remodeling, New Construction, Roofing, Countertops, Plumbing, Flooring, Tile, and more.

Established as a Company since 1991, Cortesi Construction is #1 in customer satisfaction, offering experienced, reliable, and fast service to ensure we don’t waste your time or money. All Work comes with a 100% customer satisfaction guarantee. While Projects are ongoing there is always on site supervisor making sure the job gets done right and just the way you like it.

We offer free estimates and references upon request. 
We Are The Handyman Experts, Call The Experts, serving the areas of Union City, San Francisco, & Fremont CA. CA General Contractors License # 818945.

What is Invoice Factoring

Invoice factoring is a financial tool that businesses can use in order to enhance their cash flow. An invoice, or typically known as accounts receivable, is technically an asset. For the most part, these invoices are paid 30 to 90 days after the service or product has been sold. If a business does not want to wait the full period in order to be paid on their invoices, they can factor their invoices and receive cash within days.

Invoice factoring is done by a factoring company. They will give you a certain percentage of the value of your invoices, and when your customer pays their invoices, that is when the factoring company will receive their money. So for an example, if you have an accounts receivable that is valued at $100,000, a factoring company might extend you $90,000 now, and charge a 2% factoring fee. When your customer pays in 60 days, you'll pay them the $90,000 plus the 2% factoring fee.

This financial tool can be extremely useful in times when your business needs fast access to cash, but is unable to secure a line of credit from banks for various reasons. When you're looking to do invoice factoring for your company, the factoring companies do not look at the credit of your own business, but they will look at the credits of your customers.

A lot of businesses out there have no idea that they could be improving their businesses cash flow and put it in a position for upward growth. Some businesses can have an extreme amount of money tied up in accounts receivable, and all they have to do to unlock their cash is to factor their invoices.

The great thing about invoice factoring is that you do not have to be a large corporation in order to factor your invoices. There are even some businesses out there that will factor single invoices. It is also not a long-term contract that you get yourself into. If all you want to do is factor some invoices one time, and then continue on with your business as you have in the past, and that is perfectly fine. Also, on the flipside, if you want to factor your invoices on a continuous basis, then there are a number of factoring companies out there that can handle your request.

Your business is tight on cash. You need money to either pay your payroll, or to purchase more inventory to keep up with growth. You are maxed out on your loans, and the banks are not willing to lend you any more money. You have tens of thousands, or hundreds of thousands, or even millions of dollars tied up in accounts receivables.

You are out of ideas, so what should you do? Factor your invoices.

Factoring your invoices is rather simple. Instead of waiting 30, 60, or 90 days to receive your money from customers, you can sell your invoice to a factoring company and get that money now. For the benefit of getting cash now, you will pay a percentage fee based on the value of the invoice. This fee can be low such as one or two percent. So for paying a small fee, you are able to get money for your receivables and use that money to optimize your cash flow and make your business operation more efficeint and profitable.

Is Invoice Factoring For You?

Invoice Factoring is great, because no matter what size your business, there are a lot of avenues for you to take advantage of factoring. Whether you have invoices that are thousands of dollars, or you have invoices that are millions of dollars, you are able to take advantage of factoring.

Accounts Receivable Factoring Companies | Accounts Receivable Factoring

Canadian business owners and financial managers are hearing more and more about the concept of ‘factoring ‘their accounts receivable as a cash flow solution and overall strategy. Increasing numbers of companies are investigating what most people consider to be an ‘alternative financing’ strategy.

‘Alternative ‘clearly is in the context of alternative to a Canadian chartered bank line of credit. As Canadian companies build up their investments in accounts receivable ( and inventory ) they are finding it more difficult than every to ensure that their customers are paying them on time, typically not receiving those payments in 30 days per the terms they provide to their customers . Naturally the current somewhat difficult economic environment as we head into the 2010 Business year lends itself to slow paying receivables. Management therefore is paying more and more attention to managing cash flow, and, most notably, this is taking more and more of senior management and business owner time.

The basic challenge is as simple as it gets – suppliers, landlord, and, dare we say it, your employees want to get paid on time , while the source of that cash is tied up in receivables that are paid in , many times 60-90 days.

Enter Factoring as a potential solution that will allow the Canadian company to benefit from increased cash flow, albeit at a cost. Just to be clear, the term factoring is also referred to as ‘invoice discounting’ and ‘accounts receivable financing ‘.

The mechanics at the outset seem overly simple . You send your invoice (or invoices) to the ‘factor’ firm who immediately, usually same day, sometimes next day, issues you funds for that invoice or group of invoices. All of a sudden you immediately have the working capital and cash flow to run your business.

Let’s be clear, this is not a loan per se. It is an immediate advance of funds against money owing to your firm for products and services you have delivered. We used alternate term ‘invoice discounting’ as noted above. The ‘discount ‘referred to be the amount of the finance charge the lender keeps for carrying the receivable.

We cant over emphasize the fact that the funds generated from an accounts receivable financing facility such as we have describe should be used for short term working capital needs . You need to view the factoring facility in exactly the same manner as your bank line of credit (if you had one!)

So more about the potential ‘benefit ‘of factoring that we have alluded to. We can somewhat easily say that a factoring facility can be set up in fairly short time, certainly in much less time than it would take for your firm to negotiate a bank cash term loan or a Canadian chartered bank line of credit. Another benefit? It’s simply that you receive that much needed cash same day. A very significant amount of the invoices, usually 80-90% is ‘advanced ‘to your firm the same day. The difference is held back as a temporary holdback, and remitted to your firm, less the finance fee, when you customer pays.

We have focused on some of the benefits of factoring, such as the strong cash flow aspect of this type of facility, and its ease of set up once you have found a solid partner firm. However, the cost of the facility is usually between 1 -3% of the invoice amount for a 30 day period – Naturally you entered into such a facility because your customers probably weren’t paying you in 30 days already, so you can see that the financing fees can add up .

So, as in all business evaluations there are trade offs – if you firm can absorb the financing costs with adequate profit margins on your products and services you can categorically benefit from a factoring, a ka working capital facility .!

Invoice factoring refers for the process in which smaller companies sell invoices to become able to obtain funds these days. In this case they do not need to wait for a credit period of 30, 60, or 90 days. Thus by selling invoices smaller firms tend not to generate debt. This exercise of invoice factoring is basically employed as a finance management tool.

This practice of invoice factoring is usually adopted to avoid any loans or giving any collateral against availing any loan. The fee for invoice factoring is paid in terms of discount. This discount can ranger anywhere between 2.5% to 7%. Like a result of invoice factoring the smaller companies prevent exhibiting any loans on their balance sheets plus they also do not have to invest any interest for the money taken. This results in much better profit figures but slightly different with purchase order funding.

A number of businesses also assist tiny companies in invoice factoring. These businesses set up the firm with the perfect factor for any distinct factoring circumstance. If a person has an invoice or any receivable to become factored then these firms come out to assistance within the same.

These businesses assist the manufacturers, distributors, importers, exporters, wholesalers, contractors, suppliers etc equivocally. They also support truckers in construction invoice factoring. These organizations assist to locate ideal aspect for any particular predicament within the area or can also aid to select from nationwide factoring organizations to avail the finest rates. They usually customized solution as per the clients need. To avail the services of such firms firstly a form needs to become filled out stating the type of receivables and other details needed for invoice factoring. Then these companies approach the probable paying parties that avail invoice factoring. Some of these organizations assume the risk inside the deal for non-recourse factoring wherever the client is not required to spend back.

You will discover various sorts of organizations with distinct forms of rates for factoring. Any invoices or receivables towards amount of $100,000 may be factored instantly. The average rate payable for discount in such cases is 2-5%.

Some companies specialize for a particular category of invoice factoring. For instance, some businesses indulge only in invoice factoring for medical business. Some firms, which cater to little and medium businesses for invoice factoring, build invoices on the net and acquire immediate funding. They usually give a 24 hours turnaround. Other kinds of businesses also give funds to small firms for their day to day operations against collateral of their invoice or buy order. These types of organizations also purchase mortgage notes, structured settlement annuity or medical receivables.

From Entrepreneur:

Say you're a young startup–growing fast, but with little-to-zero positive cash flow–and you're straining to reach the next level or just to get through the end of the month. The bank-financing drought is showing no sign of letting up, and of course credit lines are reeled in tight.

What's the answer? For a growing number of startups, it is factoring. The practice involves a financing company, or “factor,” advancing you money based on its buying your receivables at a discount; your customers pay the factor the full value later, when the bill is due. Factoring gets you cash in hand immediately–but at a steep price. Factoring fees are much higher than interest rates charged by a commercial bank. Fees are quoted by the month, so a typical 3 percent fee is actually the equivalent of a 36 percent annual interest rate.

Dealing with a factor can also be much more difficult than with a commercial bank. Banks are highly regulated, offer competitive rates and commoditized lending services, so entrepreneurs can, with few exceptions, easily anticipate the cost and terms of their loan. But factoring is very fragmented. Most factor financing is provided by smaller, unconventional lenders. It is much less regulated and the quality, reliability and integrity of factors vary widely.

The reason more startups are turning to this more expensive, risky alternative is simple: It is often the only way to get cash. And if it is the route you decide to pursue, due diligence is the single most important step. Investigate how long the factor has been in business, where its offices and headquarters are and the background of its management team. Ask for referrals from current clients, and research complaints or lawsuits using web searches, the Better Business Bureau and the state's Attorney General's Office. Also, trust your gut: If you feel you can't build trust with the factor, don't pursue the loan.

If you go forward, review your contract with a magnifying glass, particularly these points:

• What is the duration of the contract? The shorter the better–ideally, month to month. You want to switch to less expensive financing as soon as possible.
• Will the factor negotiate? Some factors allow contract negotiations while others offer only take-it-or-leave-it documents.
• Must you provide a personal guarantee? This allows the factor to go after you and your assets to be repaid. Some factors will lend without a personal guarantee or on a “non-recourse” basis.
• Will the factor take possession of your receivables if they are uncollected? Probably not, which means you'll need to collect on your own. Be prepared: If receivables are uncollected, you'll need to repay the factor's advance or you may lose financing altogether.
• How will the factor notify your customers? Ideally, the factor will create a lockbox to accept payments in care of your company. You maintain day-to-day contact with your clients so that everything appears seamless and they are not aware of your financial situation.
• Will you be required to factor 100 percent of your receivables? Cash flow and collections patterns fluctuate, and some weeks you may not need financing. If your factor requires you to finance all receivables, you will pay dearly for financing even when you don't need it. Single-invoice or spot factoring allows you to opt out.
• Is there a minimum or maximum sales requirement? Some factors require a certain sales volume. If you are not within the limits, you may lose your financing–so the fewer restrictions, the better.

Finally, always keep the end in sight. The real goal with factoring is to improve your cash flow, increase liquidity and rebuild net worth to qualify for commercial bank financing. Commercial bankers can help you figure out the financial targets that can help you re-qualify, but it is up to you to create the plan.

As a commercial lender, I have seen businesses resort to factor financing for one or two years at the most. If the company still didn't qualify for bank financing at that point, chances are, it was already out of business.

From Entrepreneur:

Say you're a young startup–growing fast, but with little-to-zero positive cash flow–and you're straining to reach the next level or just to get through the end of the month. The bank-financing drought is showing no sign of letting up, and of course credit lines are reeled in tight.

What's the answer? For a growing number of startups, it is factoring. The practice involves a financing company, or “factor,” advancing you money based on its buying your receivables at a discount; your customers pay the factor the full value later, when the bill is due. Factoring gets you cash in hand immediately–but at a steep price. Factoring fees are much higher than interest rates charged by a commercial bank. Fees are quoted by the month, so a typical 3 percent fee is actually the equivalent of a 36 percent annual interest rate.

Dealing with a factor can also be much more difficult than with a commercial bank. Banks are highly regulated, offer competitive rates and commoditized lending services, so entrepreneurs can, with few exceptions, easily anticipate the cost and terms of their loan. But factoring is very fragmented. Most factor financing is provided by smaller, unconventional lenders. It is much less regulated and the quality, reliability and integrity of factors vary widely.

The reason more startups are turning to this more expensive, risky alternative is simple: It is often the only way to get cash. And if it is the route you decide to pursue, due diligence is the single most important step. Investigate how long the factor has been in business, where its offices and headquarters are and the background of its management team. Ask for referrals from current clients, and research complaints or lawsuits using web searches, the Better Business Bureau and the state's Attorney General's Office. Also, trust your gut: If you feel you can't build trust with the factor, don't pursue the loan.

If you go forward, review your contract with a magnifying glass, particularly these points:

• What is the duration of the contract? The shorter the better–ideally, month to month. You want to switch to less expensive financing as soon as possible.
• Will the factor negotiate? Some factors allow contract negotiations while others offer only take-it-or-leave-it documents.
• Must you provide a personal guarantee? This allows the factor to go after you and your assets to be repaid. Some factors will lend without a personal guarantee or on a “non-recourse” basis.
• Will the factor take possession of your receivables if they are uncollected? Probably not, which means you'll need to collect on your own. Be prepared: If receivables are uncollected, you'll need to repay the factor's advance or you may lose financing altogether.
• How will the factor notify your customers? Ideally, the factor will create a lockbox to accept payments in care of your company. You maintain day-to-day contact with your clients so that everything appears seamless and they are not aware of your financial situation.
• Will you be required to factor 100 percent of your receivables? Cash flow and collections patterns fluctuate, and some weeks you may not need financing. If your factor requires you to finance all receivables, you will pay dearly for financing even when you don't need it. Single-invoice or spot factoring allows you to opt out.
• Is there a minimum or maximum sales requirement? Some factors require a certain sales volume. If you are not within the limits, you may lose your financing–so the fewer restrictions, the better.

Finally, always keep the end in sight. The real goal with factoring is to improve your cash flow, increase liquidity and rebuild net worth to qualify for commercial bank financing. Commercial bankers can help you figure out the financial targets that can help you re-qualify, but it is up to you to create the plan.

As a commercial lender, I have seen businesses resort to factor financing for one or two years at the most. If the company still didn't qualify for bank financing at that point, chances are, it was already out of business.

Factoring in Canada provides Canadian business owners and financial managers with an alternative method of financing working capital and cash flow needs. A classic situations in which your firm would utilize this method of financing is when you are experiencing strong growth, or unable to finance daily working capital needs when you have significantly larger orders or contracts with either a new or existing customer . Factoring in Canada is the financing of good accounts receivable. The business model is simple to understand, but requires extra diligence on your behalf in choosing which technical method of factoring would work best for your firm.

We recommend non notification factoring to our clients, although that is only one of several methods available to your firm. Under the non notification method of factoring you are in total control of your receivables and working capital. You bill and collect your receivables in the normal manner that you always have, but at the same time, due to the way in which factoring benefits business, you receive instant cash flow and working capital as soon as you are able to generate a valid invoice to your customer.

The higher cost of this type of financing can in many cases easily be offset by smarter buying on your firms part, or taking advantage of discounts not previously available to yourself when you carried large receivable and inventory positions based on traditional customer payment habits of 30, 60, and yes even 90 days sometimes . If you have a customer that is paying in 60-90 days you can generate all the cash due from those sales 2-3 times via factoring, as opposed to getting paid once in the customers 60-90 day payment time to yourself .

Factoring is simply all about working capital turnover. Is factoring the panacea of total goodness for your firm. We tell clients that no one type of financing is always going to be the best long term solution for your firm , but quite frankly factoring is an excellent ' bridge ' to your next level of growth . That bridge is there because your firm is new, has financial challenges, or, as we noted, is growing too quickly to allow you to negotiate traditional bank financing.

So how do we 'cross the bridge 'our clients ask? The answer is to simply understand the following facts:

- Factoring is a solid immediate cash flow and working capital solution for Canadian business

- Factoring has a higher cost than traditional financing

- More often than not it should be viewed as an interim financing facility

- There are different types of factoring in Canada offered by different firms – Don't choose the wrong facility!

Factoring and receivable financing, (also known as invoice discounting) differs from traditional bank lines of credit. Depending on which type of factoring facility you use you in effect can have unlimited access to working capita. That is simply because this type of financing focuses on your assets themselves, not your balance sheet and income statement. In negotiating a bank line of credit the total focus is on yourself as owner, your balance sheet, your income statement, your industry, and your years in business.

Factoring places a much smaller reliance (in some cases none!) on those guidelines, and focuses solely on the following:

You have assets (receivables)

They are financeable today for immediate cash flow!

It's as simple as that.

So, in summary is it that easy? Yes. And no. We say no because the challenging in setting up a proper factoring facility in Canada is simply understanding the differences in the types of facilities that are set up on your behalf, how they work, how they are priced, determining if you wish to lock in to a contract or leave it open ended, and your overall comfort level with the day to day business model of factoring receivables as you generate sales. Speak to a credible, trusted and experienced business advisor in this area and ensure you understand how the benefits of this type of financing can be crafted into a facility that works for your Canadian firm.

invoice factoring

Factoring in Canada is four things:

- New and increasingly accepted

- Misunderstood

- Different than in the U.S.

- Growing more popular every day as an alternative vehicle to business financing

Canadian business owners and financial managers keep hearing about factoring , and when we talk to clients who are pursuing this financing option it is increasingly clear there is a lot of mis information and ' noise ' about this unique type of financing that needs to be clarified .

So why is there so much mis information about factoring and how can business owners in Canada get the 'real story '. Part of the problem is that factoring, in our opinion, means different things to different people, both within the industry itself, and also to the Canadian business owners. Similar to the terms ' cash flow ' and 'working capital ' the use of the term is interchanged in a variety of ways . Also, factoring isn't a home grown solution, and migrated to Canada from the U.S. and Europe, where it has been in place for hundreds of years.

Factoring, also know as receivables financing , or ' invoice discounting ' is best utilized when firms are growing rapidly, have sales and verifiable invoices, and require injections of working capital for that a/r investment that otherwise might not be available through traditional sources such as the bank . In 99% of cases that we deal with where a client is a ' start up ' the initial financing through a factoring facility is a critical and valuable tool in the early growth of the company .

Let's get back to the confusion around factoring. Traditional factoring in Canada is in fact simply the sale of your receivables, and their purchase to a factor firm. The most immediate benefit is the immediate receipt of cash, which eliminates the need to wait for anywhere between 30-90 days for payment from your customer. Over the years it is inherently obvious that every firm out there recognizes that delaying payments to your suppliers is an instant form of cash flow. However, when you are on the receiving end of that, waiting for your money, that is poor consolation!

Does your business receive 100% of the invoice value when you sell your invoices either individually, or bundled in a larger amount of invoices? The answer is 'no' – You generally receive on the same day anywhere form 75-90% of the invoice value. The balance is held back as a hold back or buffer, and paid to your firm immediately on final receipt of payment from your customer. At that point factoring would be 'free ', but it isn't, there is a further deduction for the commission or financing cost by your factor firm. That cost is one of the greatest issues facing Canadian business owners, because it is anywhere in range from 9%/annum to 2-3% / month.

The costs associated with factoring in Canada have to be viewed in the context that although they are higher than traditional bank financing that point becomes moot because your firm probably cannot qualify at this point for a true Canadian chartered bank operating facility. So factoring simply allows you to grow your firm when you can't obtain sufficient financing otherwise.

So now we have understood what factoring is, and why it has become a tool within the Canadian business financing tool kit. That's the easy part. The challenge for Canadian business then becomes -

- What type of firm is the best one for my company and industry

- How does this financing work on a daily basis

- Am I comfortable enough to let the factor firm notify my customers regarding invoice verification and payment

- Is there an alternative to involving my suppliers and customers into this financing process

We advise clients that the best factoring facility in Canada is one in which your firm can bill and collect its own receivables. That type of facility is called non notification and is as close to traditional financing mechanics as one can get.

So whats our bottom line summary – it's simply as follows. Factoring in Canada is only mis understood because business owners don't have access to solid unbiased information on how it works, what it costs, and how it benchmarks as an alternative to traditional financing. Certain factoring facilities in Canada exist that are very transparent to your firm and its customers. Factoring has higher costs, but those costs can grow your sales and profits considerably. Seek out the advice of a trusted, credible and experience advisor in this somewhat misunderstood area of Canadian business financing.

factoring invoice