Reasons to transfer your recruitment funder

You’re being funded, the relationship is in place and you know how the process works. However, change occurs and there may come a time where you are looking to transfer to a different recruitment funder. Here are some of the reasons why businesses may move recruitment funders:

1. You’re not getting all of your cash flow

It’s no secret that you need to pay your invoice finance provider for their services. But, do you know if the deal that you originally signed up to is cost-effective? With a percentage of invoice value going to the provider, some of the bigger invoice finance providers only give you an agreed percentage of your invoice value in advance, typically 75% – 90%.  This will reduce your profit, squeezing your margins with certain clients.

If you are not getting 100% of your profit on a small margin client, it could still have serious cash-flow consequences on your business. This means your business has to wait until your client pays the invoice finance provider to receive their outstanding profit from invoices. For those that are on a percentage deal, the remaining outstanding profit is working capital that your competitors are using to scale and grow. It’s time to transfer funding to a model that puts your profit back in your hands, faster.

2. Do they allow flexibility?

Traditional financiers often impose concentration restrictions that limit how much business you can do with a single client. If you place too many contractors with one client, they may restrict your funding, viewing it as a risk.

Over-trading and overdue invoices are a massive issue for the invoice finance provider. Everyone likes debtor days to be low and clients to trade within limits.  However, clients may pay some invoices late due to resolvable issues like missing purchase order numbers or site addresses. It’s common for financiers to hold your profit on these invoices. Wouldn’t it be refreshing for your funding provider to take a landscape view of an account? Looking at payment history, client financial health and relationship.

3. Do you get charged interest and ‘extras’?

As discussed, late invoices happen. However, if it’s not the fault of your business then why should you be required to pay additional costs with interest charges?  On top of that your profit margin and available funds may be reduced. Other hidden costs you may be harbouring including: a set up fee for the facility, fees for checking the creditworthiness of your clients prior to engagement, auditing fees and extra fees for processing same-day payments. It’s time to transfer funding to a solution that puts your business first. Transparent, fair, and built to protect your bottom line.

4. Do you have online visibility?

If your invoice finance provider is not recruitment-specific, chances are you’ll need extra software to cope with payroll. Plus the associated back office procedures required to pay temps and file your responsibilities with HMRC.  Also, you’ll have no visibility on the state of your funding. Can you see your sales ledger? Do you know or can you access up to date credit limits agreed for your clients? How are your workers being paid?

How can QUBA Solutions support your business:

Here at QUBA Solutions have one simple fee, unlimited support, a recruitment background so we understand your business and crucially we will pay you 100% of your profit weekly, straight into your business bank account. We have an online portal – DynamiQ – which stores all the client, worker and assignment data in a secure and accessible environment. All management information is stored. Your gross profit report, sales ledger, payroll reports plus all invoices and time-sheets are accessible at any time.

If you are looking to transfer funding to a different recruitment funder why not call us today on: 01305 233178 or fill out our contact form here to see how we can do things differently.