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• 13 Jul

  What Is The Invoice Finance Sales Process

  The sales process involved with being approved for an invoice finance facility, such as factoring or invoice discounting, can vary between different providers. A generic overview of the process would be as follows.

  Invoice Finance Sales Process

  These are typical steps:

  1. Initial contact, normally by phone. Note that there are some providers that have moved towards online sign-up that may not involve any visits from a representative. Some providers will produce an offer letter at this early stage, indicating terms.
     
     
  2. Meeting with a Sales representative. This will normally involve a general discussion about your business and what you need.
     
     
  3. Survey - this may be combined with the sales visit, as some salespeople can also conduct surveys. The survey is a detailed review of your business sales ledger and other records. The surveyor will want access to a range of accounting records and often your accounting system. In some cases, this step can be conducted remotely. Note that some providers outsource this step to external agencies that specialise in conducting surveys.
     
     
  4. Documents - normally a formal offer letter and legal agreement that you sign if you wish to proceed. You should take legal advice regarding this step and it might involve signing personal guarantees. This signifies more commitment than the indicative offer that might have been issued initially. Signing the documents is normally the step that proceeds to pay away funds.
     
     
  5. Take-on - this can be conducted by post in some cases but often involves a visit to pick up the existing sales ledger of the business. In some cases, the sales ledger can be uploaded electronically. The entire process can be completed within just a few days if necessary.

  Other Steps

  As part of the process, the invoice finance company will normally conduct personal credit searches on the directors and prime movers of the business. They may also conduct other background checks, such as reviewing the company's financial accounts (if applicable).

  Additionally, there may be other steps to perfect the funder's security, e.g., the registration of a charge or debenture over the book debts of the company.

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  Also see: Case Study - Using Technology To Simplify Providing Information

  By Glenn Blackman