- Working capital tied up in trade debtors?
- Suffering from waiting 90 days for payment of invoices?
- Could you benefit from immediate payment of your sales ledger?
If the answer is ‘Yes’ to one or all three of these questions, then Factoring could be the answer to all your cash flow problems.
Cash flow problems ?
Are you one of the many businesses that wish to grow, but are unable to do so due to lack of cash flow?
If you are then Factoring services could be the solution you have been looking for to turn your sales invoices into instant cash. Thus enabling greater working capital available to expand your business, whether it be taking advantage of supplier discounts or just buying more raw materials.
With Factoring finance, up to a maximum of 80% of your sales invoices will be available for your use. Whether you use this capital or not, it is entirely up to you whether it be for working capital to even out the peaks and troughs in your operating cycle or maximise profitable opportunities such as bulk buying of raw materials to lower your cost base.
Two services are available to you and provided our entry criteria is met, the choice is up to you as to which product you wish to utilise.
Full Service Factoring
Full service Factoring brings professional management to your sales ledger, plus a funding facility that grows in line with the value of your sales ledger freeing up funds locked up in sales invoices.
As part of this service, a Factoring Company will undertake full control over your sales ledger leaving you to utilise your valuable time more efficiently.
You will also find a Factoring Companies administration service will provide a dedicated Credit Controller to your business who will act in accordance with your rules & regulations regarding customer payments, statement frequencies and the best way in which to deal with your customers.
You will be able to draw up to 90% of the value of credit-approved invoices the next working day once we have received a copy invoice. The balance outstanding will then be paid to yourself less a small administration charge when your customer pays.
Cash flow finance is similar to an overdraft, and monthly costs are calculated on the outstanding debit balance at an agreed rate over Bank Base Rate.
As for the administration charge, you will only pay 0.05%-3% of the Invoice value, which although may seem quite expensive initially, the savings will soon become evident as these charges will match your transactional banking charges plus give you the time to pursue other important areas of your business due to time freed up through ourselves managing your sales ledger.
Although similar to Full Service product, the variance is simply that you are able to convert sales invoices into cash without your customers ever being aware of the factoring Companies involvement, as you retain control of your sales ledger.
Similar to Full Service Factoring, 80% of your credit approved invoices is immediately available. You simply input the invoice details into your PC to notify the factoring Company and by the next working day the funds will be available to your business to use.
The remaining balance due to yourself will be paid direct to your bank account less.
Optional Bad Debt insurance
No matter how well you run your business, without effective protection, bad debts pose a constant threat; indeed just one debt may be enough to put your business out of business.
Bad Debt Protection Service gives you the peace of mind of insurance of up to 90% of the debt.
A unique product designed especially for cash flow finance services, it is flexible and easy to arrange. The factoring company simply identifies a trading limit for your customer, usually within 24 hours of your request, taking into account your needs and their credit-worthiness.
Provided the debt is not disputed, you are fully guaranteed for invoices that fall within the trading limit, subject to initial excess.
Factoring online access
Knowledge is power, and even more powerful when you are provided with the above enabling you to identify your current financial position.
Everything the factoring Company sees, you see on screen, from sales notified to the factoring Company and payments received from customers to an up-to-date minute record of the cash at your disposal is available at the press of a button.
You may also want to use the system to transfer monies from account to account which you have at your disposal, the same day if required.
Factoring is an excellent service, just consider some of the benefits listed below and see if any of them could be applicable to your business and how they would help you:-
- Being paid the moment you invoice
- on-going supply of working capital for growth and market opportunities.
- Freedom of the threat of bad debts
- Professional sales ledge administration
- Making net-cost savings at the same time
Talk to your local Debtor Finance experts on 0845 643 4611 who will be happy to take your call and any queries you may have.