Factoring Companies Guidebook
Scheduled Orders
Definition
Any order which specifies more than one delivery; spread over a period of time. A variation of this is a Blanket Order, which will not specify the delivery dates or even, in some cases, the quantity of goods required. In the latter case there is likely to be Call-Off's in the form of sub-orders, specifying quantities and delivery dates.
Concerns
These types of orders are usually accompanied by detailed terms and conditions of purchase. They may contain clauses that allow for damages claims in the event of late or non-delivery. In the event that the Client incurs such penalties, particularly where they cease trading, the customer may seek to offset this claim against any other outstanding invoices.
See also: - 'Part Deliveries'
Identification
Review purchase orders for evidence of this type of trading, bearing in mind that it may actually be the Call-Off or Sub-Order rather than the Blanket Order which is being viewed. These should contain a reference to the original order number. The nature of the business may also act as an indicator of this type of trading.
Treatment
Any action by us to exclude assignment or restrict funding on these debts will be dependent on the review of the Terms and Conditions of Sale or Purchase of the Client and customer. Special attention should be paid to any damages clauses within the purchaser's terms and the 'cut-off' or 'divisibility' clauses in the terms, either of the seller or purchaser.