The advantages of using a broker factoring company

The advantages of using a broker factoring company

If you run a business and wanting to release cash from the unpaid sales ledger, or thinking about factoring or invoice discounting then the UK can help by introducing you to some of the top factoring companies throughout the UK.

Many businesses in the UK choose to use a broker factoring company because the choice is so varied and different. The UK is a broker factoring company offering the following services. If you require any further information about any factoring company or broker factoring company or just in factoring in general then please call 0800 597 4757 or apply online.

  • Asset refinance – immediate injection of capital
  • Asset finance – plant & machinery, vehicles & equipment
  • Factoring which releases up to 90% of your invoices in 48 hrs
  • Mortgages & re- mortgages secured on commercial properties
  • Invoice discounting which releases up to 90% of your invoices in 48 hrs
  • Development finance
  • Trade finance
  • Stock finance
  • Venture capital
  • Secured personal loans
  • Business loans
  • Insolvency advice

What is a broker factoring company?

A broker factoring company is a party that arranges transactions between a business that sells on credit terms and a factoring company, and gets a commission when the deal is executed from the factoring company. A broker factoring company who also acts as a seller or as a buyer becomes a principal party to the deal. Distinguish agent: one who acts on behalf of a principal.

The broker factoring company provides a conventional full-service, commission-based brokerage relationship under a signed agreement with a seller or ‘buyer representation’ agreement with a business looking for cash flow finance.

What information will a broker factoring company request from a customer considering factoring?

A clever and diligent broker factoring company will ask the below questions as part of the process of choosing the correct factoring company to instruct.

  • Does your company sell on credit terms to other companies?
  • Do you have a preference regarding the location of your invoice finance provider?
  • What type of facility are you interested in?
  • What industry are you in?
  • What is your forecast annual turnover this financial year?
  • Estimated funding requirement?
  • Is your business subject to seasonal trade?
  • Are you seeking to finance all or part of your ledger?
  • Are you seeking a facility for a single debtor only?
  • Are you subject to CIS certificates? (Construction industry only)
  • What percentage of your ledger is subject to sale or return items?
  • What percentage of your ledger is subject to staged payments?
  • What percentage of your ledger is of a contractual nature?
  • What percentage of your ledger is government debt?
  • What are your standard terms?
  • What is the amount of outstanding invoices?
  • What is the percentage of income generated by the biggest customer?
  • What is the average number of invoices issued each month?
  • What is the average period of credit used by your customers?

Why should you consider using a broker factoring company?

  • A broker factoring company will help choose the right factoring company to use. This is because even though many factoring companies make promises to pay up to 95% of the value of invoices, in reality they try to get this figure down as low as possible.
  • Most broker factoring firms get paid a commission by the factoring company so do not charge the customer. For this reason it really could pay for you to contact a factoring broker company.
  • Deciding whether to use a factoring company is a hard decision and with so much many factoring firms to choose from a broker factoring can explain the advantages and disadvantages of each firm.
  • A broker factoring company gets access to confidential industry knowledge and as such as can exclusive offers.
  • A factoring broker company, over the years deals, with business of all sectors and the needs of entrepreneurs and different business sectors. This market knowledge is indispensable.

As a small business owner, there will come a time when might want to consider invoice or factoring finance for your company. Whether you are applying for factoring or invoice discounting, or looking at trade finance, the process and experience can be unnerving. You can try and handle the paperwork and applications yourself, or you can use the services of a professional broker factoring company to handle the application process.

Please call 0800 597 4757 if your business is considering factoring as an option. The factoring as a leading factoring company broker will be in an ideal position to help.

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