Andy Porter, Sole Trader of Andy Porter Driving Services, was having problems with cash flow due to the nature of his business - typically he had to pay out for travel and fuel before his invoices would be settled by the customer, sometimes beyond the 30 days terms he set. And as he is on the road most of the day he didn't have any time for credit control and chasing payments.
In 2003 Andy had to cease trading after one of his main contracts worth £1.25 million came to an end and with eight staff on the books, he had no way of paying them. He considered giving up work altogether but a friend that owned a similar business took on his customers and employed him.
Four years later Andy was able to start up on his own again and took his customers back, but the cash flow problem returned. During a delivery to the South of France, he suffered a heart attack and had to be admitted to hospital. Andy then lost his licence for three months while he recovered, in accordance with the law.
The cash flow problem has persisted since then and he was unsure whether a factoring facility would be possible due to his low turnover. Then one incident led to him looking further into it:
"While out on the road I stopped to refuel and when I went to pay I couldn't as there wasn't any cash in my account," he says. "Alarm bells started ringing as there should have been at least £1,800 from a client in there. But it turns out he had lost the invoice in his system and not been able to pay it. As I am on the road all the time I don't have time to chase payments."
So he searched online for a factoring company and came across Touch Financial, the nationwide commercial finance brokers. After a short interview asking what his requirements are, he was given three options and eventually went with First Capital as it advanced the most cash on receipt of invoices - 85% instead of the 75% offered by the other lenders.
"This factoring facility has ensured I can drive and look for work without the added pressure of having to chase payments," Andy adds. "This is a fickle business with no guarantee of work each day so to have one major worry of my back is a huge relief.
"Since I have been using the facility, Touch Financial has been on the phone a number of times to check that it is working properly and I am happy with the set up. I am quite old fashioned with a poor understanding of technology so to have a very tolerant and flexible lender that explains everything in detail has been very reassuring."
