With hundreds of thousands of businesses across North America working with thousands of factoring companies, individual experiences in factoring range across the board. Some business owners are extremely happy with their factoring companies and the financial results they’ve achieved through factoring their invoices. Others have had negative experiences for a wide variety of reasons.
What are those business owners’ common complaints?
- “Factoring costs more than bank loans.” While this can be true, many factoring clients are not ready yet to qualify for a traditional loan from a bank. For them, factoring their invoices offers a valuable cash flow solution that comes with benefits and services that they won’t get with a bank loan.
- “The factoring agreement is hard to understand.” Like so many contracts, factoring agreements are legal documents with legal language that covers a variety of contingencies. Yet it is critical that potential clients read and understand their factoring agreement before signing. It helps to work with a factoring company whose factoring professionals will answer every question and explain each part of your factoring agreement.
- “Factoring companies add hidden fees.” It is true that some factoring companies advertise low factoring rates while omitting additional costs of doing business with them. Leading factoring companies may have slightly higher factoring rates, but they won’t surprise you with charges and fees above and beyond what you were promised. The real costs and expenses to run a factoring company remain constant across the board; if a factoring company’s rates are unusually low compared to the competition, there’s usually some other way they expect to earn revenues from clients
- “My account manager is not helpful.” Some factoring companies cut corners with staffing or are not able to retain good employees. Look for a well-established factoring company with positive reviews about their client relationship personnel. Levels of customer service can vary widely among different factoring companies. You want to partner with people who will work with you one-on-one to ensure you receive your funds fast every time.
Leading factoring companies welcome client feedback and regularly survey their clients to ensure that their cost structure and operations are clearly understood and their high customer service standards are being met. Surveys help alleviate clients’ complaints and expedite problem-solving when concerns are raised. Surveys also ensure that clients are receiving the benefits and services that they deserve. At Interstate Capital, quarterly client surveys indicate an exceptional level of satisfaction with Interstate’s processes and personnel. With no hidden fees and transparency in all dealings, Interstate Capital continues to provide trustworthy factoring services to business owners from many industries. When you’re ready to turn your accounts receivable into cash in your pocket, click here for your no-obligation factoring rate quote from an industry leader since 1993.