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Case Studies

If you are looking at an invoice finance facility in Edinburgh your first port of call should be Smart Factoring Quotes. Smart factoring Quotes specialise in arranging factoring and invoice discounting facilities and we understand which lenders are best placed to help businesses in Edinburgh.

Our approach is as follows:

  • we explain in full what your options are
  • We explain all hidden costs and other things that you should be aware of
  • our aim to allow you to make an informed decision
  • we aim to structure facilities to maximise cash generation and minimise costs

If you are a business based in or close to Edinburgh please give us a call. Our aim is to save you valuable time and money by taking the stress and uncertainty out of arranging an invoice finance facility.

Settlement discounts can make a very valuable contribution to the bottom line of a company. I have recently looked at 2 invoice finance requirements where the companies were looking to access cash with a view to taking advantage of settlement discounts from suppliers.

One company was able to negotiate a discount of 5% and the other was able to negotiate a discount of 3%. Given their turnover this discount made a considerable contribution to their profits. This has to be compared to this costs of an invoice finance facility but in both these instances it was a viable model for increasing profits.

It could be worth exploring what settlement discounts are available to your business from it’s suppliers. Remember to explore what invoice finance options are open to your business and be sure to understand the full costs involved.

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.

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:

  • use the invoice finance market to your advantage and look to see which lenders are hungry for new clients.
  • look beyond the headline rates and consider total costs over a 12 month period.
  • remember you are part of a preferred sector so don’t be shy to negotiate strongly to reduce rates.
  • when looking at cash generation ensure that limits are available at least for your top debtors.
  • look at how a concentration limit could limit your funding – this is very important if you have a customer that makes up a large part of your turnover.
  • consider raising finance against your perms – some lenders will offer a 70% prepayment against perms.

For a cleaning company, factoring can be a valuable source of finance. The service can be quite labour intensive with cleaners visiting offices to clean and they may require wages on a weekly basis. The issue from a cashflow perspective is the the cleaning company may only get paid by clients on a monthly basis at best.

This is where cleaning company factoring can assist. As invoices are raised they can be notified to the factoring company who will advance up to 90% of the invoice value. This will allow wages to be paid without the worry of invoices being paid.

If you have an invoice factoring company it is worth contacting Smart Factoring Quotes to see which invoice factoring company will be the provider most suited to your businesses requirements.

Factoring in Scotland is readily available for businesses selling to other businesses on credit terms. If you are looking for a factoring facility in Scotland it is worth visiting the Smart factoring Quotes website.

Scotland is serviced by several factoring companies such as RBS, Lloyds, Clydesdale, Aldermore, Close and Bibby. There are also other invoice finance companies that can service Scottish clients. Choosing the right company for your business is however the biggest challenge.

Most factoring companies in the UK are happy to provide invoice finance facilities in Scotland if the entity is a registered company in England as there is no difference to funding a company in England. However, I understand issues arise if the company is a Scottish registered company. I am told the issue relates to registering debentures.

If you are a Scottish registered company you still have a choice of lenders beyond the Scottish banks. If you are a company registered in England then your range of choices is much wider.

If you are looking for Factoring in Scotland it is worth contacting Smart Factoring Quotes to see what your choices are.

Our client is a haulage company. They approached Smart Factoring Quotes to seek advice on how best to set up an invoice discounting facility. They were keen to obtain a facility that allowed ‘export invoices’ to be raised to their european clients for the backloads that they carried back to the UK.

Our client had been through challenging times because of rising fuel prices and exchange rate fluctuations. However, they had maintained turnover and had a well established business.

They had been offered factoring facilities but felt that they were best placed to collect in the debts as they knew their customers best. As such they wanted an invoice discounting facility.

If you look at the whole market of invoice finance companies not all are able to provide invoice discounting. Our client was raising export invoices which reduced the amount of lenders able to assist even further.

Through our knowledge of each lenders capabilities and criteria we were able to introduce lenders that were genuinely capable of helping and more importantly were actively seeking new clients.

As such we secured a confidential invoice discounting facility for our client at very competitive rates.

We have several invoice factoring clients who operate in the scaffolding industry. They have always found it difficult to find invoice factoring companies who want to lend to them because of the industry that they operate in. However, as an industry scaffolders require cash flow finance because the house builders are slow to pay yet wages need paying weekly. On top of that funding for tubing is hard to come by and often has to be hired in at high rates or bought for cash which only compound the problem.

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