0845 863 0738
Call now for expert advice

Scotland

11 Apr

Invoice Discounting »

by

When speaking with clients we are often asked to source invoice discounting facilities on their behalf. When I press the prospect on why they want invoice discounting it is often because they feel the facility is confidential and they want to retain control of their credit control.

I think traditionally invoice discounting was confidential but I am seeing more and more lenders insisting upon disclosure and disclosed invoice discounting seems to be more common.

If you are looking to retain control of your credit control then invoice discounting whether confidential or disclosed will meet your needs. You may also consider a CHOCS facility which is essentially factoring but allows you to do your own credit control. CHOCS stands fo Client Handles Own Collections and just to confuse matters it can also be disclosed or confidential. Typically a CHOCS facility will be more readily available than an invoice discounting facility because the criteria are less stringent.

If you are looking for a confidential facility then obviously a confidential invoice discounting facility will meet your requirements. However, you may also wish to consider confidential CHOCS which is more readily available and also confidential factoring where credit control is done by the factoring company but in the name of your business.

28 Feb

Factoring in Glasgow »

by

We were recently approached by a haulage business based in Glasgow who wanted to review their facility. It was a very nice business and they advised that they had only ever reviewed their facility with the Scottish banks. Given the recent well publicised problems they wanted to look at other alternatives. It should also be stated that they are a Scottish registered company.

While we knew the companies that could provide factoring Glasgow to a Scottish registered company we decided to go back to the market to see if anyone new had this capability. We were delighted to see that a few new lenders now had the capability to help businesses based in Scotland and were very keen to do so.

In short we were able to source a very competitive facility for our client.

If you are a business based in Glasgow or anywhere else in Scotland it really is worth exploring what opportunities are available to you.

14 Feb

Recruitment Finance »

by

Recruitment finance can take various formats. Typically it depends on the type of recruitment and also the size of the company. We will look at the three main options available:

Recruitment factoring: this is suitable for recruitment companies of all sizes and for both temporary recruitment companies and permanent recruitment companies. It provides an advance against invoices raised of up to 90% allowing temps wages to be paid. It is also suitable for permanent recruitment companies but prepayments are typically around 70% for perms. Recruitment factoring is available to new start businesses aswell as larger well established companies. It includes a credit control service and can also include credit protection to reduce the risk of bad debts.

Recruitment invoice Discounting: suitable for companies that are better established and have a good credit control function within the business. This type of recruitment finance does not include a credit control service. It can be confidential or discolsed and can include credit protection to reduce the risk of bad debts. Again it can be used for either temporary recruitment or permanent recruitment.

Recruitment back office solutions: well suited to recruitment companies that want to outsource the full back office function. This service can provide finance in the same way as factoring but 100% prepayment levels can be achieved. It also includes payroll and admin services aswell as optional credit protection and credit control.

If you have a requirement for recruitment finance it is worth contacting Smart Factoring Quotes to discuss your options in detail.

28 Jan

Factoring rates »

by

Factoring Rates can differ dramatically from lender to lender. We will have a look at what variables impact on the pricing of a factoring facility and then we will look at why some factoring companies are more expensive than others.

What impacts on the service fee?

The service fee is what the lender charges for administering your facility and it is typically determined by workload. This is dictated by the number of debtors you have an also the number of invoices you issue. Turnover also has a huge impact on your service fee and typically the higher your turnover the lower the percentage service fee.

The discounting fee, what impacts on this?

This is the cost of borrowing and it should reflect the risk the company is taking. The total fee is made up of the base rate and the margin. Some lenders use the Bank of England base rate while others use LIBOR. Watch out also for the minimum  base rates which a lot of lenders put in place. The margin is often dictated by their credit policies and with negotiation can often be reduced.

These are the 2 main fees but it is important to be aware of additional fees and charges. Always consider total costs when looking at different offers. Please also consider what service is actually on offer and ensure it meets the needs of your business. Factoring rates are obviously importants but so are service levels and facility structure.

09 Jan

Factoring and Credit Control »

by

We often receive enquiries from clients who are keen to transfer from one lender to another because the credit control is poor.

I am afraid to say that often the provider accused of providing a poor service is a bank owned factoring company. However, when we ask how the factoring company was chosen there is also a common theme. They were either chosen because that is who the business banks with so it was a default choice or because they were the cheapest.

Without going to the market it is almost impossible to understand what your options are. If you don’t understand what your options are then how can you make an informed decision?

If you have chosen the very cheapest option then are you really suprised that the service does not quite meet your expectations? Would you expect free champagne on an Easyjet flight or free home installation from Ikea. No, of course you wouldn’t.

Typically with credit control from a factoring companny you will get what you pay for. The larger bank owned factors will typically fully automate their credit control and it will be done by automated letters and month end statements. They may call your largest debtors but it will be a hands off approach.

Other factoring companies will provide a hands on credit control service where they call each debtor and have open communication with you the client. This however is time consuming and as such the cost for suvch a service is more expensive.

When choosing a factoring facility it is important to understand what level of service you expect and choose a lender accordingly.

 

15 Nov

Smart Factoring Quotes launch a Factoring Blog »

by

Smart factoring quotes are proud to announce the launch of a factoring blog on their new updated website.

The factoring blog is aimed at business owners who have a factoring facility or are looking for a factoring facility. It will provide relevant industry updates aswell as discussing topical issues that business owners encounter both with factoring facilities and also with the economy at large.

We will be welcoming any comments but don’t want to become a message board for rumours or scaremongering.

03 Nov

Confidential Invoice Finance »

by

I am quite often approached by clients who insist on using confidential facilities. The reasons for this can be varied and I always try to accomodate their requirement.

Traditionally confidential invoice finance has been hard to obtain as the only product available was confidential invoice discounting. The criteria for this were quite rigid and it was reserved for large, profitable business with a good finance and administration function.

The good news is that confidential facilities are now more readily available than ever. This makes the life of an invoice finance broker much easier as it means we have a wider range of products to offer clients based on their unique requirements.

Confidential facilities now include confidential factoring, confidential CHOCS there is a new confidential product due to be launched in January 2012 which we are quite excited about.

If you have a business that is looking for a confidential invoice finance facility please contact Smart Factoring Quotes on 0845 863 0738

 

12 Oct

Factoring in Scotland – A Case Study »

by

Smart Factoring Quotes were approached by a residential care provider just outside Glasgow.

They were keen to source factoring scotland. They were paying staff on a weekly basis but were having to wait a considerable amount of time to get paid by the local authorities.

We explored several options for them including full factoring, CHOCS and invoice discounting. As the credit control was not really an issue they decided that factoring was not good value as they were paying for a credit control service they just did not need.

We were able to source an invoice discounting facility that was much cheaper but still met all their requirements.

We have a lot of clients in Scotland and have an excellent network of lenders covering scotland.

If you have a business in Scotland and wish to explore the factoring and invoice discounting options open to you please call Smart Factoring Quotes on 0845 863 0738

01 Oct

Invoice Finance – advantages and disadvantages »

by

Invoice finance is a form of finance that can provide valuable working capital to your business. I want to explore objectively the advantages and disadvantages of invoice finance.

Advantages of invoice finance

  • invoice finance can provide up to 90% of the value of your sales ledger and ongoing invoices as cash to use within your business.
  • this may allow you to take advantage of settlement discounts
  • if you use factoring you can outsource the credit control of your business freeing up more time to concentrate on growth
  • by taking up credit protection you can eliminate the risk of bad debts
  • an invoice finance facility should grow in line with your sales

Disadvanatge of invoice finance

  • an invoice finance facility can be costly when compared to an overdraft facility. However, this is not always a real option.
  • some people perceive factoring as losing control of your sales ledger rather than outsourcing.
  • some poeple also feel that there is a stigma attached to factoring
  • you can be tied into lengthy contracts and notice periods which can be restrictive
  • hidden costs or at least costs beyond the headline rates can cause frustrations
  • retentions and other restrictions on the funding can also mean that the true prepayment level is not what is expected or anywhere near the headline rate

I believe that an invoice finance facility can work very well in the right circumstances. However, it is important to understand exactly what is on offer. hat means you must understand the total costs involved and also the mechanics of calculating the cash made available.

22 Sep

Factoring Advice – Who to trust? »

by

When looking for factoring advice I am always amazed at who people approach. I accept that my views may be tainted somewhat as I am a factoring broker but it is what I specialise in and I know and am 100% impartial.

Let’s have a look at who business owners will approach to obtain a recommendation for factoring:

Bank managers – your bank manager will only ever recommend their own bank’s factoring company. They are heavily targeted to sell this product so you will receive a single recommendation not taking into account what your requirement is or what the market can offer. In contrast a factoring broker can look at your requirement and recommend the lenders best placed to meet your needs.

Accountants – unfortunately a lot of accountants take commissions from invoice finance providers (as do invoice finance brokers) The problem is that accountants do not specialise in setting up invoice factoring facilities and often do not look at it as in depth as they should. They will also have a few localised relationships rather than using the whole market.

Brokers owned by factoring companies – some brokers are actually owned by factoring companies. As such guess who they are most likely to recommend? If you are using a broker at least ensure they are independent and impartial.

Brokers owned by insolvency practitioners – this may seem like a strange relationship but insolvency practitioners are keen to be appointed by factoring companies. If they can offer factoring companies new business they are likely to receive more appointments. As such you could find yourself placed with a factoring company they owe a favour to rather than the one best placed to meet your needs.

In my opinion you should be taking factoring advice from a specialist and someone who is 100% impartial and independent.

There are a lot of good brokers in the market who are specialists and totally impartial.

At Smart Factoring Quotes we are totally independent and impartial. We are also specialists as invoice finance is all we do.

Page 1 of 212

Recent Posts

Twitter Updates

  • @ factoringforum: Invoice Factoring Forum Post: Invoice Discounting http://t.co/Gc1kAgAw
  • @ factoringforum: Invoice Factoring Forum Post: Factoring in Glasgow http://t.co/Eg9LV0jU
  • @ factoringforum: Invoice Factoring Forum Post: Sports Bras http://t.co/ORcT2hS2
  • @ factoringforum: Invoice Factoring Forum Post: Recruitment Finance http://t.co/dvB0lXJI

Our Network

© Copyright 2012 Invoice Factoring Forum - All rights reserved - Designed by Free Wordpress Themes and Web Design Leeds ported by Invoice factoring