GE Capital acquires Crédit Agricole Commercial Finance UK

Eurofactor as was has been acquired by GE Capital in an interesting move that should strengthen it’s position as a “big ticket” factoring organization as well as in Europe.

I’ve always had a bit of soft spot for GE as I started out my factoring career at H&H Factors as it was then called more decades ago than I care to remember. It’s had a bit of a chequered history in recent years as it seems that they could never make up their minds where in the market place they wanted to be, having bought Five Arrows Commercial Finance three years ago in order to gain more exposure in the smaller company sector they then proceeded to unload many of their clients, seemingly in a change of mind.

The press release announcing the acquisition of Crédit Agricole Commercial Finance states “Following the acquisition, GE Capital will have in excess of 500 clients across the UK” which should compared to the press release issued three years ago when they took over Five Arrows which stated “Following the acquisition, GE Commercial Finance, Business Finance will have more than 1,000 customers across the UK.” Seeing as Crédit Agricole recently claimed to have 258 clients it would seem that GE have lost a huge number of clients in the last three years

Nevertheless this should be an interesting development and I wish them every success

Posted in Credit Agricole, Eurofactor, GE Commercial Finance | Leave a comment

Business Money Dinner

The annual Business Money Dinner is always a good time to meet up with old friends and make new ones and last night’s do in Birmingham was no exception. The food and comedian were dreadful but they were amply made up for by the eye candy from Warwick University in the next room.

One of the things that I always find interesting is which factoring broker is sitting at which factoring company’s table as it gives a good idea of who is in favour with who and last night there were one or two surprises. Equally surprising was some of the absences as many of the high profile broking outfits were noticeable by their absence.

Many thanks to mine hosts for an excellent and amusing evening

Posted in factoring brokers, Factoring companies | Tagged | 2 Comments

Interesting factoring statistics from the ABFA

The Asset Based Finance Association (ABFA) has recently released statistics relating to the factoring and invoice discounting market for the first quarter of 2011 which show some growth in the overall marketplace but it’s the accompanying press release that I find most interesting.

Firstly there is the claim that “Invoice finance clients are again choosing not to drawdown all the lending available to them, showing that clients have sufficient funds for their business needs. The total funding available was £21.1bn yet only £14.8bn was utilised by clients, meaning there were £6.3bn of funds still available.”

I am picturing hundreds of factoring clients ringing up their client manager saying “No thanks I don’t need any money this week” I don’t suppose that the truth has anything to do with the many restrictions that the factoring companies impose to make sure that their clients never get anywhere near the notional funding limits.

The second claim that caught my eye was that “The average turnover of clients using invoice finance has increased from this time last year, even though total client numbers have dropped slightly following the recession. The average annual turnover per client a year ago was £4.36m, whereas this has grown to £5.27m in Q1 2011, a 21% growth in just a year.” A further statistic that wasn’t mentioned but has a huge bearing is that the number of clients with sales in excess of £100m per annum has grown from 205 in the quarter ended 31st March 2010 to 220 in the same quarter this year and that extra 15 clients who’s combined turnover will presumably total at least £1.5 billion will be enough to render the rest of the statistics completely meaningless.

Alastair Campbell would be justifiably proud of that press release :)

Posted in Factoring, Factoring statistics | Tagged , | 1 Comment

Factoring for recruitment companies

We seem to be receiving an unusually high number of enquiries from recruitment companies who have been using the services of one particular high profile payroll and back office company complaining that they aren’t getting the expected levels of funding due to problems with credit limits.

This is understandable in a non recourse situation if the customers aren’t creditworthy but in the case of the latest one his customers are local authorities with the largest customer representing less than 20% of the total ledger.

Call me cynical but this is a classic sympton of a payroll company running out of money and squeezing it’s clients as a result and is one reason why I never recommend taking debtor funding from anyone other than a specialist factoring company.

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Factoring brokers and the internet

More and more supposed factoring brokers are using the internet to attract customers. Unfortunately this means that anyone with some web design skills can throw together a site and try and generate some factoring leads but it can’t be in the customers best interests if the person behind the website doesn’t know the first thing about factoring.

Anyone who keeps an eye on Google will have noticed a new website has recently appeared on page one with what on the surface appears to be a decent website containing a few fairly standard articles about factoring.

The website contains logos from Venture, Bibby, Lloyds TSB, Aldermore, Close and Hitachi which purports to give the impression that the company has a relationship with each of them, but does it?

There is an invitation to submit details on a contact form but nowhere on the site does it have an address or telephone number and having looked up ownership of the domain in Nominet I have never heard of the owner and neither has anyone that I have asked although a quick Google check shows that as well as articles about factoring he has also published articles about getting rid of spots and how to cook a pizza.

Most internet savvy people would never deal with a website that doesn’t have either an address or telephone number but unfortunately many of the potential customers won’t be as wary.

This isn’t the only one as I came up with another last week that have a highly professional and expensive looking website with branches in Glasgow, Birmingham, Newcastle, Bristol, Manchester and Nottingham which makes it look like a pretty sizeable outfit.

It even has testimonials including one saying “We found ****** to be absolutely terrific. They arranged an invoice factoring deal for us quickly and efficiently. Would certainly recommend them” and this was signed by DL, Operations Manager of ABC Ltd

Intrigued to find out more about this high profile outfit I looked up the ownership of the website to see that it registered to the very same ABC Ltd who gave it such a glowing testimonial and a bit more research shows the website owner is a actually a contract cleaning company.

I have often said that factoring companies should be regulated and I also think that it would be in the customers’ best interests if brokers were also regulated as I’m sure that you can’t get best advice from a broker unless he knows the industry, but unfortunately the poor old customer has no idea if his broker knows what he’s talking about or not and it seems that there are a lot around who don’t.

Posted in Aldermore, Bibby Factors, Close Invoice Finance, Factoring, factoring brokers, Factoring companies, Hitachi Capital, Venture Finance | 1 Comment

Bibby Factors appoints new Chief Executive

Bibby Factors have quietly announced that Simon Featherstone will be taking over as Chief Executive of the Bibby Factoring Group on the retirement of David Robertson. This is quite a coup as Simon is currently running the hugely successful factoring arm of Lloyds TSB.

I doubt whether Ed Rimmer will be best pleased though

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NACFB drop the ball

According to a recent press release the National Association of Commercial Finance Brokers (NACFB) have dropped the ball by appointing Andrew Bullard of Cashflow UK to their board.

According to the blurb “In his new position on the board, Andrew will now be representing commercial finance brokers and promoting invoice finance as a viable source of income for members of the association”

It further goes on to say “Andrew says: “Companies in the UK continue to face the challenge of securing finance through traditional routes and I look forward to championing the benefits of invoice finance to commercial brokers within the association.”

Cashflow UK is then described as “a leading finance brokerage specialising in factoring and invoice discounting and its team of financial experts is able to offer impartial advice and find your client the best provider to match their individual business needs.”

What of course the NACFB have omitted to say is that Cashflow UK is a wholly owned subsidiary of Bibby Factors which makes Andrew’s role as an independent advisor somewhat moot.

Most of the truly independent factoring brokers have always had a sense of unease that one of the major players in the broking market is actually owned by a factoring company but surely this latest step is taking things a bit too far

Posted in Factoring | Tagged , , , | 3 Comments

Venture Finance – the kings of self promotion

Venture are one of those companies that delight in taking the slightest opportunity for a bit of self promotion and the latest bit of PR to arrive across my desk is to tell me that their Birmingham office has moved address.

For most companies it would suffice to give the new address and the date of the move but I guess that Venture employ a PR man who needs to earn his corn so I received the following:-

“Venture has strengthened its presence in Birmingham by relocating to a new office in the city centre.

The new address is:
Venture Finance
Victoria House
116 Colmore Row
Birmingham
B3 3BD

The new office has a great location in the centre of Birmingham, just a few hundred yards from New Street rail station. This will enable our Midlands team to provide an even better and more tangible service to our introducers.

With a fourth Business Improvement District recently approved for Southside, these are exciting times to be located right at the heart of the city and we look forward to continuing our efforts in supporting local businesses meet the recovery with strength.”

According to Multimap, Venture have moved just two and a half miles from Edgbaston to the much more expensive Colmore Row and I am intrigued to know how this move will enable their team to offer a better and more tangible service to introducers.

The new address is certainly nearer to the bars and restaurants in the city centre and I wonder if this is anything to do with the “exciting times” referred to. After all, it is December

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Independent Bank Reviews

The word on the grapevine is that the banks are becoming increasingly nervous about many of their invoice discounting facilities in these recessionary times and their nerves are showing in the amount of Independent Bank Reviews that are being performed where an outside firm of accountants / insolvency practitioners are asked to perform reviews of the company in order to calm the nerves of the invoice discounting financier.

These reviews do not come cheap and naturally it is the client who is forced to bear the cost. It wouldn’t be so bad if the discounter acted upon the review but we have recently come across a case where the bank factor appointed a well known form of insolvency practitioners to conduct a review to support an application for an increased funding line. The review was very positive and supportive of the client but the bank decided not to increase the funding line in any event but still charged the £15,000 cost of the review to the poor client.

Posted in Invoice discounting | 1 Comment