Factoring companies offer a poor service in many cases

Factoring company marketing material usually includes case studies invariably including one or more companies that have transferred to them from another factor. The prime reason for given for the transfer is generally given as the poor service that they received at the hands of the previous factoring company.

In many cases this “professional approach” of the factoring company consists of sending out computer generated credit control letters and very little else. Human nature being what it is, many of the customers will prefer payment to those suppliers that chase them for money and put those that don’t to the bottom of the pile so it isn’t unusual for a company who’s customers take an average of 60 days to pay gradually finding the average slipping to 70 days or more. Surprisingly perhaps it is the larger bank owned factors that are the worst offenders.

Short sighted factoring companies are aware that the more clients and customers their staff can handle the more profitable they become. The fact that this comes at the expense of the service levels that they offer their clients as well as ineffective credit control is of little concern to them. Fortunately there are some factoring companies that take the long term view that by offering a better quality service they will retain more satisfied clients and these are the only factoring companies that we will deal with.

Please click on the link to see why factoring costs end up higher than first thought.