Factoring Brokers - Choosing the Right Factoring Company
As Factoring has developed so has a broker market offering advisory and introductory services. A broker should obviously know the market, the providers and be able 156-915.70 to explain, without the use of industry jargon, how a facility works and what costs, benefits and pitfalls may be encountered.
By using a broker a business should expect completely impartial advice. Brokers are paid by lenders on a success basis so any broker attempting to take a fee direct from a business should be avoided.
Very often a business will secure a more competitive rate by using a broker in preference to going direct to a lender. Likewise a good broker will know to which provider a prospective user should turn. All Factoring Companies have different criteria as well as varying likes 156-910.70 and dislikes with regard to industry sectors.
It's difficult to know to which broker a business should turn. Web based ones used automated costings to provide indicative prices but at best these are only going to be a rough guide and at worst misleading. No two businesses are the same so they all have differing costings.
Experience is vital, the market changes frequently so a broker with a detailed knowledge will have an in depth insight.
Independence is also important, ideally the broker should not be advising a business with an interest elsewhere, either through being owned by a factoring company or professional services firm.
With the growing popularity of Factoring and Factoring type facilities has come a sharp rise in the number of companies providing such facilities. What was once almost the sole preserve of the UK Banks is now crowded with all manner of providers from the banks themselves through to small, independent providers sometimes operating on a regional basis.
There are privately owned providers, venture capital owned, taxpayer owned, American owned, French owned and so on and just about all the providers have merit in their offerings.
They all have their likes and dislikes and some will enter into sectors such as construction where others fear to tread. Different pricing policies mean that the same business, talking to three different companies 156-315.65 will get three different price offerings.
Recent developments include the provision of single invoice factoring, historically not offered in favour of whole turnover agreements. Likewise the arrival of a web based auction system through which businesses can have investors bid to buy invoices is an innovative and potentially exciting new product.
Overall there are a lot of variations on the general factoring theme so finding the right one for your business can be a time consuming and not always rewarding exercise.