Ian

Cattles yet again

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Cattles PLC the parent company of Cattles Invoice Finance just can’t keep out of the news but unfortunately for all of the wrong reasons.

This time the board of the parent company has suspended three directors of one of it’s subsidiaries (Welcome Finance) who appear to be carrying the can for allegedly not applying the correct group procedures to the impairment provisions resulting in a delay to the publishing of the audited accounts.

Shares have dived even further from their high of £2.20 a year ago to just 2.5p at the moment at which price I have risked a modest amount and I am now the proud owner of 10,000 shares in Cattles. For anyone crying “foul” there is no conflict of interest as it’s many years since I introduced any business to the factoring subsidiary and they are certainly off the radar as far as Factoring Solutions is concerned until their financial position becomes far, far clearer.

Cattles Invoice Finance – the problems mount

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Cattles seem to be having a tough time of it lately as according to an article in the Scotsman a few days ago here it seems like one of their Scottish clients has been invoicing fresh air to the tune of £650,000

As if that wasn’t bad enough the shares in the parent company dived again last week as they had to issue a warning that their results would be delayed “pending completion of a review of the adequacy of its impairment provisions” which sounds to me rather like the auditors aren’t happy with the provisions.

Talking to one factoring company last week I was told that they were being inundated with CVs from employees from Cattles Invoice Finance which speaks volumes about staff morale.

Factoring charges – the hidden costs

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The factoring market has long been very competitive but when prospective factoring clients compare quotes from a number of different providers they often just look at the headline rates without bothering to delve any further into the small print.

We came across a company recently who banked with RBS and had naturally approached RBS Invoice Finance for a factoring quote. According to the prospect the quote for factoring the debts of this £300,000 pa turnover company was “a little on the high side” but it wasn’t until they emailed the quote over that I realised quite how high it was as it included a setup charge of £1,500 which is three or four times the size that most of the independents would charge but the real sting in the tail was the 1% renewal fee which I must admit was a new one on me.

Asking around it seems that RBS Invoice Finance wasn’t the only factoring company to charge renewal fees as HBOS also used to do it.

I was discussing a quote for an invoice discounting facility with a provider today and I asked him whether he had quoted a renewal fee and his reply was that his company didn’t charge them whereupon I suggested that he should have put renewal fee – none in his quote as we know that we are tendering against a couple of bank owned factoring companies who may well have renewal fees.

Whilst discussing renewal fees the factor told me that he had seen a quote from RBS Invoice Finance that included a termination fee. This wasn’t a fee in lieu of notice for an early termination but would have been payable on top of the balance of any minimum fees whenever the client decided that he no longer needed his facility.

It’s getting to be a bit of a minefield out there.

Yet another dining story

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Less than two months after the “Christmas Curry” episode I had a call from the Sales Director of one of the independent factoring companies who wanted to meet up for a chat. He suggested picking me up at The Belfry Hotel where I have a pre-arranged earlier meeting and taking me to lunch at a pub a couple of miles away.

A couple of hours after this was arranged I had a call from one of his colleagues to update me on some deals that he was handling for me and he happened to mention that he was on a train London bound. Wondering what he was doing on a train to London at a time in the late afternoon when he should be taking the train out of London back home I was told that he and the ops director were meeting someone from a well known insolvency practice and were taking him out to dinner that night at Gordon Ramsey’s restaurant.

I’m beginning to spot a pattern here 🙁

 

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Interesting new slant on client relations

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We had an enquiry from a company today that has been factoring with one of the better known factoring companies and had a successful relationship until they moved from one branch to another.

Things went very quickly downhill as the factor seemed to have a number of internal administration problems including a large staff turnover but with more staff leaving than being replaced. The client was told on more than one occasion that they couldn’t cope with the clients that they had on the reduced staffing levels and on one occasion when they asked why the money hadn’t been sent over was told that the invoices hadn’t been input into the system as the data entry girl was off sick.

When the client politely suggested that the service wasn’t as good as it had been in the previous branch she was told that if she didn’t like it “she could sling her hook”.

I think that this comment will probably win the Factoring Blog client relations award of the year and it’s only February.