Trade debtors may be the largest asset on your balance sheet, but they may turn into cash at a much slower rate than you would like. Factoring Strategies can offer a range of options to solve this issue:

Full service factoring

Factoring can provide the complete answer to slow-paying customers, shortage of working capital and, if needed, protection against bad debts. A factor agrees to pay a percentage of your approved sales invoices as soon as they are raised and notified. Services such as sales ledger management and credit control may be included within this full service and can be available on both export and UK sales.

Sales ledger management

Factors can offer a comprehensive sales ledger management and credit control service - so you get paid faster by your customers, without damaging the goodwill you have developed. You needn’t wait until your customers pay, because the factor may pay up to 90% of outstanding invoices right away - and the balance when your customers pay. By undertaking your credit management and collections work, a factor can offer major savings on your administration costs, while faster customer payments often mean reduced borrowing, resulting in lower interest costs.

Invoice Discounting

Even if your business practices sound credit management, you may still need to turn debtors into cash faster, thus generating maximum working capital from your trade debtors. This is where invoice discounting can help. Invoice discounting can be either confidential or disclosed, making cash immediately available up to 90% of the value of your approved invoices, while you retain responsibility for the sales ledger management and credit control. Payments that you receive are paid into a bank account administered by the Invoice Discounter, after which you are credited with the balance, less charges.


Specialist Factoring Situations

Factoring is used extensively in industry sectors such as temporary recruitment, transport, manufacturing, printing and the service sector.

At Factoring Strategies, we can also recommend which companies may provide funding in non-typical factoring situations such as:

• Exporting;
• Contracting and construction; and
• Formal insolvency situations such as in administration and company voluntary arrangements

Other services

Because factors understand the working capital needs of the small and medium-sized business, many of our factors also offer a range of other services, such as trade/stock/asset finance and bad debt protection to safeguard your profits and cash flow. As part of the DTE Group, we can also advise you on a range of value added services, such as payroll and HR outsourcing.


Service charges

The charges for a full factoring service are quoted formally, once a factor gains a full understanding of your business, but they are usually between 0.75% and 2.5% of turnover. Whereas charges are lower for invoice discounting facilities which reflects the customer regaining responsibility for sales ledger management and credit control.  Interest rates applied to all advances are typically in line with secured overdraft rates.