50% Factoring Cost Saving

We were recently in contact with a prospective client that already used a recourse factoring facility provided by a bank owned factoring company. The business was interested in saving some cost and so we were asked to search for alternative factoring quotations for them, via our free, independent search service.

A recourse factoring facility will provide the user with funding against credit invoices as they raise them and also with a credit control service, provided by the factoring company. This can reduce of remove the need for an in-house credit control function.

The business was relatively small and involved with the supply of wine, a product that will work well with a factoring facility as there are few complications, it is a simple "sell-and-forget" product. They were paying their existing factoring company a combined service charge and discount charge of circa £12K per annum, hence their desire to achieve a cost saving.

We searched the market for the prospect and we were able to find them a similar recourse factoring facility but with the combined service and discount charges reduced to circa £6K per annum, a huge reduction of 50% of the total cost of factoring. This is an example of the kind of cost savings that can be achieved if you know the market and are prepared to shop around for factoring quotations.