Protecting your business with bad debt protection

Another way that we are proud to stand out from the crowd is with our 100% bad debt protection service. This works alongside your invoice discounting facility and enables you to operate safe in the knowledge that you will not be affected by potential bad debts from your customers.
While most other providers only cover up to 90%, we can protect you against up to 100% of your customers, providing they are all approved by our Credit Team. But don't take our word for it, here's a testimonial from one of our BDP clients and if you like the sound of it get in touch with us now and you can have the first 6 months cover absolutely free*!

Isomass Ltd is a soundproofing company, supplying goods to the construction industry. The business has been providing a wide range of domestic and commercial building solutions since established by company directors, Iain Mair and David Bignell, in 2007.

Challenge

David and Iain had considered the funding options that would suit the size of the business and the nature of the industry they operated in. They chose a factoring arrangement with a Credit Control Team that they could trust to chase any debtors for unpaid invoices, leaving them to concentrate on growing their business.

With limited initial resources, Isomass had recognised that chasing outstanding customer invoices would burden sales at a crucial time. In addition, knowing that they would be covered if any customers had difficulties paying was seen as essential.

Solution

Close Brothers Invoice Finance provided a £75,000 factoring facility, and Isomass Ltd also took advantage of our bad debt protection product. Working alongside the factoring arrangement, this service provides essential cover against any potential loss that might otherwise not be recovered. David said, “You never know what can happen – even big companies can face financial difficulties and bad debt protection gives us peace of mind to know that the business can progress even when faced with customer insolvencies”.

Result

Since working with Close Brothers, Isomass Ltd has experienced two instances of bad debt which could have lost the business over £4,000. Besides providing cover against any credit approved customers getting into difficulty, Isomass know they can rely on the expertise at Close Brothers to help them make informed decisions about new customers.
David commented: “The team at Close Brothers Invoice Finance are great to work with and I know I can rely on them to chase my outstanding customer invoices and offer valuable advice. By allocating a percentage of my profit to the bad debt protection service, I can sleep at night, safe in the knowledge that my business is protected.”

*Terms and conditions apply

Growing concern over UK’s digital skills shortage

MORE than two fifths (43 per cent) of SMEs in the UK believe that they will need enhanced or increased digital capabilities in the next three years, in order to cope with the ever-changing business landscape.

Of that number, 77 per cent are worried about how they will successfully upskill, with many firms citing difficulties finding suitably skilled staff and the level of investment required as potential stumbling blocks.

CEO of Close Brothers Invoice Finance, David Thomson, said: “Our findings suggest that many SMEs do not feel adequately equipped for the future and that many are concerned that finding staff with the appropriate skills will be a challenge.

The figures come from the latest Close Brothers Business Barometer, a quarterly survey that seeks to canvass the opinion of SME owners and managers across the UK on a range of issues that affect their business.

Mr Thomson continued: “A recent paper published by 02, The Future Digital Skills Needs of the UK Economy*, estimates that there is a requirement for almost three quarters of a million (745,000) additional workers with digital skills to meet the rising demand from employers and fuel the UK economy during the next three years.

“With this in mind, we need to explore how the UK can be prepared to compete in a digital global economy. Perhaps it is becoming necessary for businesses to look towards the younger generation to help address the growing skills gap.”

The survey also found that, of the firms who do not believe they will have any requirement for increased digital ability, 31 per cent of those do not consider digital skills as relevant to their business.

“SMEs across the board should consider the importance of digital skills in their workforce and the value these skills can bring. With £107 billion forecast to be spent online in 2014**, it is vital that SMEs are equipped for e-commerce and have the skills required to engage customers via their website or social media sites. It is clear that additional industry support is needed to deliver digital skills education in schools and also help young people into digital roles by offering more practical work experience.

“By working hand-in-hand with the government, UK firms can help to tackle this issue and ensure that we have the skills required to compete on a global level,” added Mr Thomson.

For more information and news about Close Brothers Invoice Finance please visit www.closeinvoice.co.uk

Sources
* The Future Digital Skills Needs of the UK Economy, 2013
** IMRG Capgemini e-Retail Sales Index, 2013

Invoice finance explained

Lots of business people - even experienced Finance Directors - seem to have a slightly confused view of what invoice finance is, what it can do and what size business can benefit.

So we thought we’d set the record straight with a simple explanation:

What is invoice finance?

Most businesses have to wait between 30 to 90 days (sometimes even longer) from when they raise an invoice to when they actually get the money in their account. Invoice finance fills this gap. When you use invoice finance, you get 90% of the value of the invoice within 24 hours and the remaining balance, less agreed fees, when the customer eventually pays.

What can it do for your business?

The immediate benefit is improved cash flow. Instead of having to wait for your customer to pay, carrying all those business overheads and costs while you wait, you get most of the money you are owed straight away, so you can invest that back into your business.

Are there any other benefits?

Yes - invoice finance allows you to fund your business based on your turnover, rather than your credit rating. As you grow the business you have more money available. It can help you to make more accurate financial predictions and allows you to react faster to changing market conditions.

Invoice finance can also offer you the option of bad debt protection, which means that you can get on with running your business without worrying if your invoices will get paid.

What size business can benefit?

Invoice finance can work for all sizes of business, from start-ups and SMEs to larger organisations. Close Brothers Invoice Finance typically supports businesses with between £0.5m and £10m turnover.

Want to know more?

If you’d like to know more, take a look at the helpful video at: http://www.closeinvoice.co.uk/videos/index.html