..................outsourcing

Factoring Partners

Outsourcing the sales ledger is one of the primary reasons Factoring exists. Factors have invested in people and systems which enable them to manage efficiently multiple sales ledgers. They will collect outstanding invoices from your customers and work with you in this area to ensure the vital relationship between you and your customer is not compromised. Different businesses have different terms of trade but it is a fact that Factors collect quicker - and then some Factors collect quicker than others. Picture this - your business has annual sales around £1m. You quote 30 days on your invoices but your customers take double this usually. This means you are probably owed around £165,000 at any given time. This is your money and whilst you are waiting you still have to pay your staff, suppliers and, of course, the taxman, be it for PAYE, NI or VAT. Now let's say a Factor manages to persuade your customers to pay, on average, after 50 days. This means the average amount owed will come down to around £135,000. Guess where the £30k difference is - that's right - in your business! Sales ledger management can be enhanced by credit insurance covering your customers so where a limit has been granted you don't have to worry over that customer becoming insolvent. Your Factor will provide an electronic link to your ledger. Again service and technical levels vary amongst Factors so shop around. The software will provide detailed information on your customers which can be put to good on-going marketing use. Overall Factoring can and does help business. Of course there will be situations where the Factor can't improve on a particular businesses credit control but generally they will. Service levels vary considerably so seek a couple of quotes and ask to speak to existing clients and gauge their opinion.       Factoring Partners, The Threshing Barn, Newhouse Farm Business Centre, Edstone, Warwickshire invoice factoring B95 6DL Tel, 0845 0180700 or mobile 07966 492154 email us