Factoring – An Overview

A shortage of working capital is often the biggest problem a company has. All the money it is owed is tied up in outstanding invoices, and you will have to wait 30, 60 or even 90 days before you get paid. How would your business benefit from releasing the cash from these invoices now? What would you do with this additional cash flow? Along with providing you with finance the lender will also manage your sales ledger, do your credit control and ensure you have time to run your business. At the Business Bureau we work with 22 of the top UK Invoice Finance companies, and have access to all the benefits they offer to their principle Factoring Brokers.

Factoring – How it works.

When you raise new invoices, you send them to your customers in the normal way. You will also send a copy to the Factoring Company (usually electronically), and they will make available the pre agreed percentage against the value of the invoice immediately. In addition to providing you with the finance, they will also manage your sales ledger, collect the outstanding invoices, and once they have received payment from your customer they will pass back to you what is owed less any fees.

Why will Factoring be good for me?

• Instant access to the cash you have already invoiced.
• You choose how much you need to borrow and when.
• You will save time and money on chasing invoices, leaving you free to run your business.
• No other assets are usually required to secure the finance facility.

Is Factoring right for you?

• Are you a new start or established business based in the UK selling to other businesses?
• Are your annual sales projected at or already over £50,000?
• You will save time and money on chasing invoices, leaving you free to run your business.
• Do you raise trade invoices on 30, 60 or 90 day terms?

How much does Factoring cost?

This will vary from lender to lender, but there are generally 2 costs of a factoring facility:

• Service Fee. This will be a percentage of your sales, and is calculated based on your sales, the number of customers you have and the number of invoices you raise.
• Discount (Interest) fee. This will be the interest charged on the money you take from the Factoring Company.

Working with you to find the most appropriate Finance for you Business.

We want you to find the best Business Finance for your organization. Our aim is simple. As a leading Finance Broker we want to save you time and money by introducing you to the right lender. Our team of experienced Factoring and Finance Brokers is available should you want to discuss your specific requirements, be they Working Capital, Asset Finance or Credit Insurance The Business Bureau has worked with hundred of clients to find the right finance for them, and our highly experienced Business Finance team will be delighted to work with you.