Factoring companies need to get more personal
Factoring companies lack the personal touch and lose their clients as a result
We found that the enquiry level for for factoring in June remained at high levels despite distractions like the World Cup and summer finally arriving and whilst we had our usual crop of enquiries from companies dissatisfied with the service that they were receiving from their existing factoring company two of them in particular stood out.
A recruitment company had been with the same payroll funder for twelve months on what we considered to be very competitive rates but without any prior warning had received a letter stating that the rates would be doubling on 1st August. The MD was livid and telephoned us in high dudgeon about the way that this matter was handled.
The second company had lost a County Court case, not paid the debt quickly enough and had a CCJ registered against them. Factoring companies are always on the lookout for CCJ’s registered against their clients and whilst most factors in this situation would ask the account manager to contact the client and find out the reasons, in this case the factoring company just wrote to their client saying that they were withdrawing all funding until the matter was resolved and charged them £100 for sending the letter.
I think that some factoring companies have the attitude that once the ink on the agreement is dry they can treat their clients how they like but it’s a short sighted view as the market is very competitive and if these factors don’t want any clients there are plenty of others that will look after them properly.