New Millennium Group has Gone Bust

Adminstrators were appointed to The New Millennium Group Ltd at the end of April claiming that they: had encountered difficulties after seeing levels of demand for recruitment services in the banking sector drop, as well as issues around meeting its rent obligations We understand that the company has subsequently been sold although the press release didn’t say to whom. We have often raised concerns about dealing with payroll / funding companies such as New Millennium…

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Factoring Statistics 2012

The factoring companies’ trade association has recently released statistics showing the numbers of companies using factoring and invoicing discounting increased in the first half of 2012 to just under 43,000. Nearly 75% of the increased number of clients came from companies going down the invoice discounting route with factoring clients showing a much smaller increase. Although the ABFA release reams of statistics every quarter very little of it is relevant as the overall figures are…

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Which Factoring Company?

Amongst the factoring enquiries received in March were a couple that decided not to go along with our recommendation. The first was a new start recruitment company and having discussed his requirements extensively we introduced them to a factoring company known for their high service levels having stressed that they also offered a refund of all fees paid if the company were unhappy with the service levels. When they later informed us that they had decided to…

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Factoring Interest Rates are Dropping – Or are they?

Factoring companies are now advertising interest rates of 0.5% over Base Rate but many people reading the adverts fail to realise quite what a clever marketing ploy it is. Taking a typical small company with an annual turnover of £500,000 the customers averaging 60 days to pay and the factoring company funding at 80% of invoices the difference between 0.5% over base rate and a more usual 2% over Base Rate works out to £966…

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Factoring Companies Credit Control Worsens Yet Again

Recently released figures by the factoring companies’ trade association show that the average credit days taken by factored customers has worsened for the fourth year running from 56 days in 2003 to 63.1 days in 2007. Whilst some may put this 13% worsening down to the economic climate it is interesting that invoice discounting clients record an overall average reduction in credit days taken over the last three years to it’s current level of 55.8…

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Factoring for Your Recruitment Company

The word on the grapevine is that yet another of the high profile companies that offer both back office and “factoring” is about to collapse leaving many of it’s client companies in the lurch. Whilst I can understand the appeal of outsourcing the payroll administration I am very dubious of some of the back office companies that also offer a funding package as they seem to be obtaining the necessary funds by “back to back”…

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Trade Finance – Where to Find the Right Choice

Following on from last month’s note on trade finance we received a couple of interesting enquiries illustrating how little knowledge in the broker market there seems to be about this type of finance. The first company had only been trading for a few months with an innovative product that they were selling to a Government body. They were forecasting sales of £10m per annum if they could fund the purchase of the product from the…

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Factoring Companies Need to get More Personal

We found that the enquiry level for for factoring in June remained at high levels despite distractions like the World Cup and summer finally arriving and whilst we had our usual crop of enquiries from companies dissatisfied with the service that they were receiving from their existing factoring company two of them in particular stood out. A recruitment company had been with the same payroll funder for twelve months on what we considered to be…

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FDA – Factors & Discounters Association

Many brokers, introducers and accountants etc when discussing factoring will advise companies to select a factoring company that is a member of the Factors & Discounters Association which I find rather strange. The FDA is a trade association who’s prime function is “Promoting and representing the interests of members” according to the logo plastered all over the home page of their website and has nothing whatsoever to do with the protection of the interests of…

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Factoring Continues to Grow in UK

Statistics recently released by the UK factoring industry’s trade association show the continued growth in the receivables finance market in the UK with 43,000 companies using factoring or invoice discounting at 31st December 2005 and generating a combined turnover in excess of £160billion on an annualised basis. This steady increase in factoring and invoice discounting is the reverse of the traditional bank overdraft lending which seems to be in decline as the banks continue to…

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High Street Banks – don’t you just love them?

Last week we had an enquiry from an importer and distributor of furniture who despite having a successful relationship for three years with the factoring subsidiary of a well known high street bank was now suffering from cash flow problems. Their crime was apparently that they had been successful and their sales had been constantly increasing to their current level of £2m per annum. The factoring company in their infinite wisdom had decided to cap…

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