Invoice Factoring Firms

**cojak** · 18 January 2013, 12:12

I guess that low charge = high(er) risk?

**JoJoGabor** · 18 January 2013, 12:18

I dont know. I guess any potential supplier I will need to credit check. Just wondering if anyone uses these kind of services and can recommend one?

**eek** · 18 January 2013, 12:52

Originally posted by JoJoGabor View Post

Can anyone recommend an Invoice Factoring Company. Having ongoing payment issues with current client. Was going direct but wasnt willing to tolerate the risk of multiple outstanding payments, so went via an Agent who hasnt been paid by client in 6 months so wont do business with them anymore. Now looking at invoice factoring so I can go back direct but with less risk.

And you still want to work for them. Either they are incompetent or have cashflow problems I wouldn't take the risk either way.

**rootsnall** · 18 January 2013, 12:59

Originally posted by eek View Post

And you still want to work for them. Either they are incompetent or have cashflow problems I wouldn't take the risk either way.

WHS, time to move on, its almost always a precursor to bankruptcy IMHO, but perhaps you know otherwise in this case !? If they are a small outfit then leg it.

**Vallah** · 18 January 2013, 13:23

As others have said, there's no reason a factoring company will have any more success chasing your money than you will. Sounds like the problem is with the client.

**BolshieBastard** · 18 January 2013, 13:44

Just about what everyone on the thread has said! If this client has known regular 'difficulties' paying on time, I wouldnt touch them with a barge pole.

I know Bibby's do factoring but tbh, I'd suggest they have a good ideal who the tulip payers are and would increase their costs to you, the higher the risk.

**JoJoGabor** · 18 January 2013, 14:08

I am fully aware of the risks I am facing and have an insight into the company's finances. But this gig is worth a lot of money with a lot of potential future work. And by using a facotring company the risk is mostly removed (I am guessing I will get 80% of the invoice value immediately so the risk is reduced to 20% of the invoice value). So back to my original question, does anyone have any experience of using these firms or any recommendations?

**Vallah** · 18 January 2013, 14:18

Originally posted by JoJoGabor View Post

I am fully aware of the risks I am facing and have an insight into the company's finances. But this gig is worth a lot of money with a lot of potential future work. And by using a facotring company the risk is mostly removed (I am guessing I will get 80% of the invoice value immediately so the risk is reduced to 20% of the invoice value). So back to my original question, does anyone have any experience of using these firms or any recommendations?

I think you need to do a bit more research into how factoring actually works. You're on the hook for all of the money unless you take out very expensive bad debt protection, and normally they won't offer this if one customer makes up a large proportion of your total debts.

**eek** · 18 January 2013, 14:33

Originally posted by Vallah View Post

I think you need to do a bit more research into how factoring actually works. You're on the hook for all of the money unless you take out very expensive bad debt protection, and normally they won't offer this if one customer makes up a large proportion of your total debts.

+1 factoring doesn't remove the risk of not getting the money its just a loan of a percentage of the full invoice until its finally paid.

If the firm goes belly up without paying you need to pay the money back to the factoring company.

Invoice Factoring Firms