Reduce your administrative workload
As we just mentioned, recruitment finance providers can handle credit control for you – if you want them to, that is.
If you choose to go down this route, it’ll save your staff plenty of time they’d otherwise spend chasing your clients for payment, or juggling funds to free up cash flow.
Encourage prompter payments from your clients
For your clients, knowing that you’re using a finance provider can be just the thing that kickstarts them into paying your bill faster. Because who really wants to have to wait almost four months to be paid?
Curb the effects of bad debt
When a client owes you money, the last thing you want is for them to be unable to pay it. Yet when a company declares bankruptcy, or becomes insolvent, this is exactly what can happen.
Fortunately, most invoice factoring companies catering to recruitment agencies understand the vices and vagaries of the industry – particularly when you’re chasing big bills. That’s why the majority of recruitment finance providers offer something called ‘bad debt protection’.
Put simply, it means that the factoring company assumes responsibility for the money your client owes to you. If that client goes bust – and the debt, accordingly, goes ‘bad’ – you won’t be out of pocket because of it.
For obvious reasons, this additional service costs extra!
Receive expert advice from industry pros
Most recruitment finance companies come with dedicated support – whether that’s via live chat, phone, email, or a variety of online help resources.
These people know more about recruitment, finance, and, well… recruitment finance than most of the rest of the world – so it’s a godsend to have them on hand when an issue crops up, or when you need expert industry advice!
Use increased cash flow to grow your business
Cash will always be king – and having it is the key to realising your agency’s scalability ambitions.
When you use a recruitment finance provider for an upfront advance, you don’t just ‘unlock’ the value of your unpaid invoices – you free yourself from the manacles that cash flow (or, more accurately, a lack of it) places on your business’s growth, too.
Improve your planning for the future
Not knowing when you’re going to be paid can seriously stymie your recruitment agency’s capacity to plan for the future.
Invoice factoring, of course, does away with this uncertainty entirely. In most cases, you’ll see the money in your account within 24 hours, meaning you can take stock, and plan for what’s ahead – even in what is, objectively, a pretty uncertain period – with the utmost confidence.
Tailor a solution to the needs of your business
Typically, finance products aren’t built around what’s best for the lender, but rather the interests of the provider. With recruitment finance, that’s a bit different.
For one thing, this is because your agency is only borrowing funds related to work you’ve already completed – or, should we say, money that’s already owed to you. It’s not like taking out a traditional business loan, in that the funds come with collateral, massive interest rates, or the looming, unspoken terror that you may not be able to pay it back.
As well as being flexible – and considerably less anxiety-filled – than regular finance, invoice factoring for recruitment is also completely bespoke. The solution you receive will be tailored entirely to your agency’s turnover, as well as the amount of funding you’re seeking.