Long-Term Relationship Research Paper Example | Topics and Well Written Essays - 1750 words

Long-Term Relationship - Research Paper Example Performance based payments are preferred government financing method when the CEO if a company finds them to be practical and the contractor agrees them to their use. Performance based payments are contract financing payments which are not payments for accepted items. They are fully recoverable in the same manner as progress payments in case of default. It is not used in case of payments under cots-reimbursement line items when the contracts are assigned for progress payments based on a completion percentage and for those contracts which are awarded through advanced procedure of sealed-bid. Performance based payments are made on either a whole contract or a deliverable item basis unless it is prescribed by agency regulations. Financing payments which are made on a whole contract are applicable to the entire contract and not to specific deliverable items. Since the business can take the idea and form concept phase to full implementation phase then Performance based payments can help t he company is achieving good returns for the company. The quality of the work will improve since on the basis of delivery of goods, monies will be paid to them. Thus indirectly the performance of the business will improve as they will try to deliver the best results which they can. Advance payments are least preferred method of contract financing and should be used sparingly if at all. Other types of financing should be available to the contractor in adequate amounts. But credit and loans at excessive interest rates or other exorbitant charges are not considered reasonable available financing. Such type of financing is considered to be useful and appropriate in the cases where Contracts are solely for the management and operation of government-owned plants. It is used in contracts for research, experimental or development work with nonprofit education or research institutions. It is useful