2. Understanding rear Supplier Activity nderstanding reasons, process and cost of availing factoring finance Average Invoice Value Payment terms Cost Sunbeam Fashion Garments (SFC), New Delhi Manufacturer and suppliers of cotton garments and to reputed retail chains across India with projected total sales turnover of 2150 Crore 275 lakh 90 days from date of dispatch Factoring fee 0.050 % of invoice value Handling charges 1200 per invoice Discount Charges 9% per annum 80 % of Invoice Value A-One Factors Amount Financed Factoring Company st approaches A-One Factors for availing advance factoring with credit protection on an invoice covering dispatch of 375 lakhs to Metropolitan Ltd., a leading retail chain with pan India presence Issues to be addressed: (a) Reasons of factoring in the above case. (b) Steps of procedure from dispatch of garments until receipt of final payment. (c) Calculations of amount paid at the time of factoring and on receipt of final payment from Metropolitan Ltd., assuming A-One Factors recovers factoring feehandling! charges and discount charges upfront (at the time of releasing advance of 80%). (d) Effective annualised cost of factoring to SFC