Any size of business, established or new, in any location
(in the UK, including Northern Ireland)
We have a network of advisers waiting to help you with information, guidance and
services to assist you in financing your business. This FREE service is offered to
any business that offers credit terms to their customers (not retail)
Turn sales into cash in 24 hours
Funding Your Business Fact-or Fiction
It’s true, and well documented, that not every business can approach any lender, but sometimes we impose our own restrictions on who we think would actually lend to us – the biggest example: Factoring (where cash advances of up to 90% of an invoice value can be obtained immediately) is perceived to be for established companies only. However, one factoring company finances start up businesses at a rate of 1 in 5 deals!
Not many business owners would turn to a factoring company if the bank refused to increase an overdraft, but it is also for this reason that the factor exists. Further, should you be initiating or extending credit terms to your customers (factoring deals with non retail invoices) your bank will consider this a risk where the factor considers this as normal trading conditions.
Factoring is also perceived as being for ‘solid’ businesses with good years of trading: not so. Factoring is as much for the growing company with cash flow problems as it is for well run solvent concerns. In fact, with factoring you also get the benefit of the factors customer vetting and cash collection skills which means you can lean on them for this specialist skill as a no-cost service.
What happens if the customer does not pay when due?
The factoring company take full responsibility, and cost, of collecting the debt.
What is the benefit to a new business using a factoring company?
There are a number of real benefits:
- new businesses do not usually have sufficient assets for secured lending
as your lending capabilities grow with your business there is no need to pay fees or to re-negotiate with your bank for overdraft arrangements - no need for personal guarantees – as you do with business lending through banks
- no requirement of 1/2/3 years trading before being considered for finance
if you export, the factor is invaluable for advice and expertise - 90% immediate funding available
- professional credit management services come with the package – so, no training or costs
Can I transfer to a new factoring company?
Yes, many companies change factoring company as the competition between factoring companies bring fees down, and non-chargeable support services increase. The change over is seamless with no cash flow delays.