factoring case history
Whilst we will never deviate from our ethical approach to broking not every "case history" is a sign of success. We were approached by someone with a two year old company turning over £200,000 that had a large exposure into one customer and he was looking for a factoring facility. He told us that he had some experience of factoring as his parents factored their own company's invoices with one of the major bank owned factors but the service they received was poor. We arranged a meeting with a factor renowned for the quality of their service and having provided him with a bagful of references to contact, including over 20 companies that had transferred to them from his parent’s factoring company, they made him the offer of a facility on competitive terms.
Nothing should surprise us nowadays but we were taken aback when told that he had decided to go with his parent’s factoring company as their offer appeared to be cheaper by a couple of hundred pounds per year. As a matter of interest this particular factor pays a higher introductory commission than most but we still refuse to introduce business to them.
Factoring
Factoring is now considered to be mainstream lending and has replaced the traditional bank overdraft in many cases but unlike other forms of funding, factoring includes a large element of service and whilst one might think that all factors are the same the truth is very different with many of the major players offering a very poor quality of service that is as likely to hold back their clients' growth as it would advance it.
As we have some very real concerns about the way some of the well known factoring companies operate we have set out some of the pitfalls including details on selecting the factoring company and why the cheapest factoring quote often works out more expensive in practice.
Invoice Discounting
Invoice discounting is currently being used by almost 14,000 companies generating combined turnovers of nearly £115 billion and it is this method of invoice finance that is experiencing the most growth at the moment. Our reservations about the activities of some invoice discounters are as valid as in factoring and we would be grateful if you could click on the link to see our areas of concern about invoice discounting
Trade Finance
Trade Finance is an area of business funding that co-exists alongside bank overdrafts, factoring and invoice discounting providing specialist finance to facilitate trade and you can read more about the types of facilities that we can arrange by clicking on the link for trade finance pages
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