Case Study - Recruitment consultant: Start up
The owner had spent nine years in the industry before starting his own company. He set himself some impressive financial targets: £500,000 turnover in the first year and then doubling that in the second.
Growing the Business Quickly
To achieve his goals the entrepreneur realised, from the outset, that he needed high quality, experienced recruitment consultants with proven track records, and he had to dedicate himself to growing the business rather than chasing late payers and worrying about credit control matters.
Furthermore, the Owner was fully aware he needed a positive cashflow if he was to succeed in the manner he desired which meant that at least 80% of his invoices needed to be paid within 48hours.
Niche Market
So when the company was just weeks old his business plan was presented to an Invoice Finance Provider, who liked what they saw: a positive identification of a niche market for supplying temporary drivers and industrial staff to the warehousing and distribution industry.
Having met all of the Provider's criteria, they became a full factoring client, leaving the Finance Provider to look after the sales ledger and carry out all credit control activities, the Owner has been true to his word and been able to achieve the business plan targets.
Future Expansion
As the company expands further the flexibility of this facility can be used, not only to support expansion but to change the basis from say, Full Factoring to Non-disclosed Invoice discounting as the company becomes more able deal with its own sales ledger.