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FS Audit services conduct periodic invoice finance audits and pre lend surveys on behalf of invoice finance companies.
Reports are produced using each lenders own template. FS Audit services believe that this will avoid any confusion internally and will enhance understanding through familiarity.
Invoice finance companies place huge importance on a businesses audit trail. The audit trail ensures that the debts are secure and provable.
If you are looking for an invoice finance facility it is important to look at your business and how robust the audit trail is.
Each business will have it’s own quirks and characteristics. As such you will have to focus on finding ways to implement a suitable audit trail.
By way of examples let’s have a look at some traditional robust audit trails that invoice factoring companies expect to see in place.
Wholesalers
Temporary Recruitment
Design Agency
The better your invoice audit trail the better. Importantly you need some kind of 3rd party sign off by way of a signed proof of delivery, signed timesheet, signed satisfaction note.
This may seem like additional administration but it is key to sourcing a facility and it is a good step for your own internal procedures.
Invoice finance can indeed increase profits. However, it is important to remember that it depends on what you do with the cash that the facility generates. It definitely increases your costs as you will have the invoice finance fees to pay so you will need to generate enough ‘new profit’ to cover these additional costs.
These new profits can be generated from new sales that took place because you were able to purchase more stock, fulfill more orders or perhaps pay more staff which will generate additional sales.
I have also dealt with clients who are able to take advantage of substantial settlement discounts. Any saving available that is more than the invoice finance costs leads to increased profitability.
In short yes invoice finance can lead to increased profits. However, that will depend on your own entrepreneurial abilities.
Selective factoring allows you to choose which invoices you factor. This means that you can turn selective factoring on an off as required.
If you have a sporadic requirement for working capital selective factoring can be a cost effective solution for your business.
How does selective factoring work?
If you require selective factoring please contact Smart Factoring Quotes.
How long does it take to put in place an invoice finance, invoice factoring or invoice discounting facility?
Well the flippant answer is ‘how long is a piece of string?’ However, that helps nobody. On average I would say it takes 3 weeks but I have seen it done in 2 days. While the broker and factoring company plays a very big part in the process it does rely heavily on the requirement and the information that the prospect can provide.
I remember looking at an ‘urgent requirement’ last May and advising we could have a facility in place for the ‘following friday’. While we had everything in place the prospect simply let everyone down by not being able to supply simple information – such as a copy of his passport. This rumbled on until October!!
The flip side of this is a prospect that phoned me on a Saturday evening advising he needed a £1.7m facility in place by the Wednesday. I advised him everything I would need and I had it on Sunday morning. The facility was in place to meet his deadline.
The other key things to achieving a quick turnaround is a) knowing which invoice finance company can meet your needs and b) knowing which person within that company to speak to.
An Invoice Finance Quote is available from many places but at Smart Factoring Quotes we provide bespoke indicative terms for both invoice discounting and invoice factoring.
The invoice finance quote is based upon turnover, the number of debtors you have, the number of invoices you issue and our in depth knowledge of the invoice finance market.
Pricing is obviously an important aspect of any facility but it is imperative you look beyond headline rates. Take a look at our article about calculating factoring fees and also the article about comparing factoring quotes.
If you are looking for the best invoice discounting rates it is well worth speaking to Smart Factoring Quotes. We monitor the market for the cheapest invoice discounting rates available at any one time.
At present we have several invoice discounting companies who are actively competing on price and claiming they will not be beaten on price. It is however imperative that any business owner looks beyond the headline rates and considers total costs when comparing facilities from an invoice discounting company. It is also important to remember that the lenders offering the best rates can be among the most risk averse and as such your facility may be structured in a more cautious way.
At Smart Factoring Quotes our approach is to explain the benefits and potential downside of any facility and along side this show the total annual costs involved. This will allow any business owner to consider which facility represents the best value. To me that is the most important factor – compare the benefits the facility offers against the costs and then establish which facility represents the best value to your business.
If you want a helping hand give us a shout!!
Recruitment companies often use invoice discounting however very few have optimised their facilities in the market place.
Invoice discounting is an ideal solution for temporary recruitment companies that are on monthly payment terms but have to pay wages weekly. The invoice discounting facility can be confidential which means customers are unaware and in comparison to factoring the facility is typically cheaper.
In terms of a recruitment company optimising an invoice discounting facility for both costs and cash generation they should consider the following:
