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• 26 Jan

  Size Of The Factoring And Invoice Discounting Market

  Following on from my previous posts about the Factoring & Invoice Discounting market being far from the point of saturation we ran some counts today to see how big the potential size of the market in the UK is.

  Dun & Bradstreet's Marketplace of UK Businesses lists 5,857,600 records for businesses in the UK. We selected from that list only businesses that had a turnover in excess of £200,000 per annum (proxies for this are used in the selection process where the actual size is not known) and we then selected only the Industry SIC Codes (Standard Industry Codes - or industry sectors) that would be potentially suitable for factoring or invoice discounting facilities (and we were very conservative in the sectors that we selected).

  This returned a count of 284,390 records - 4.86% of the total number of business records that would potentially be suitable prospects for invoice finance using our criteria.

  The Asset Based Finance Association's figure for the total number of businesses currently using factoring and invoice discounting, via their membership, in the UK as at September 2009, is 42,983 which represents just 15.1% of the potential invoice finance market as defined above, or 0.73% of the total D & B Marketplace of UK Businesses.

  The opportunity remains in reaching out to the remainder of those businesses that make up that prospective market.

  By Glenn Blackman