|
|
|
|
|
Application Form for Unsecured & Mortgages
|
DOES YOUR BUSINESS NEED A PAIN FREE INJECTION OF CASH? Invoice Financing is a way of releasing your capital rather than it being held by your debtors. If you answer YES to any of the following then your business will benefit greatly from factoring: * Is your turnover at least £35,000 a year? * Is your service business to business related? * Do you have one debtor or more? * Do you have a seasonal demand for a product or service? * Do you have plans for growth and require additional funding? * Have you had a confirmed order from a creditworthy customer but lacked the cash to fulfill it? * Have you been suffering poor cash flow as a result of slow paying debtors? You can raise finance up to 85% of the value of your current and future sales invoices, with funding available within 24 hours of invoicing. How does Invoice Financing work? It is a very simple process and all the procedures are agreed in advance. You will send out your invoices in the usual way except a copy of the invoice and any relevant paperwork i.e. proof of delivery, are sent to the invoice financing company. The invoice financing company is responsible for forwarding the agreed funds to you, chasing payments due, sending statements and keeping you informed about your customers. Once your customer has paid the invoice the balance of the monies is then forwarded to you. How does Invoice Financing compare to an overdraft? Invoice Financing grows with your company as opposed to a bank overdraft or loan. As more invoices are generated so is more cash made available to you - without the need to keep negotiating. Banks can withdraw or reduce overdraft facilities at short notice if you have a rough patch. Whereas Invoice Financing companies look to work closer with you if you have any difficult times. What is the difference between Invoice Factoring and Invoice Discounting? Invoice Factoring provides upfront funding and a credit control function hence making it ideally suited to new start, small to medium sized businesses. Invoice Discounting provides upfront funding only and is more suited to large established companies who have in place or can afford all the appropriate credit control facilities. What does it cost? Factoring generally costs a little more than Discounting due to the extra back office support that Factoring offers. Invoice Finances charge clients in two ways, whether it is Factoring or Discounting - one being a Service Charge which is a percentage of Invoices Factored, the second is an Interest charge for Cash Advanced against these invoices. Service Charge Interest Charge Factoring Cost 0.5% - 2.5% 2% - 3% (above base rate) Example: Haulage company with £500,000 turnover and 10 customers - Service Fee (approx) 1.15%, Interest Charge (approx) 2.5% - Monthly Cost (approx) £700 inc - less than a member of staff to run Credit Control but giving access to over £70,000 of additional funding to ease cash flow. Discount Cost 0.3% - 1.5% 1.25% - 2.5% (above base rate) Example: Manufacturing company with £2,500,000 turnover and 100 customers - Service Fee (approx) 0.35%, Interest Charge (approx) 1.75% - Monthly Cost (approx) £1,650 inc - giving access to over £350,000 of additional funding to ease cash flow. What do I do next? If you would like to know more about Invoice Financing, be it Factoring or Discounting, then call us today on 0845 75 73 724 or email us at factoring@demeconsultants.co.uk quoting Invoice Financing and we will arrange for an experienced member to answer your questions and explain in more detail how Invoice Financing can help your business with the flexibility it can offer. Other business finance products available such as Asset Finance, Export Finance and Trade Finance
|
