Using factoring to expand a business

 

Business need

Funding that could support significant business growth

Reg Roberts, CEO of recruitment company Target Recruitment Solutions set up the business in 1991, funded by a bank overdraft. Since then, Reg has expanded his business significantly, acquiring three other businesses. Within 18 months the business had grown so fast that the bank withdrew the overdraft due to overtrading and Reg needed to quickly find another form of funding that could support the rapid growth of his business.

Solution

Factoring with Close Brothers Invoice Finance

Reg found factoring was the most appropriate form of funding for Target Recruitment Solutions due to the additional benefits of a dedicated Credit Control function. This allowed him to maintain a relationship with his customers whilst having peace of mind that all invoices and statements were accurate and efficient. Reg chose a form of factoring known as CHOCs (Client Handles Own Collections) which enabled him to collect his own payments whilst maintaining a personable and communicative relationship with all of his customers.

Result

Growth and efficiency

Factoring has been a highly efficient solution for Reg and has enabled him to continuously grow the business over more than two decades. Within the first 15 years, the company’s annual turnover increased from £0.5 million to £4 million. Factoring has given Reg an immense sense of confidence as he knows that the facility will grow in line with the business and that credit limits can be extended when required, providing complete flexibility.