Businesses across all industries benefit hugely from a relevant finance package that supports their cash flow by providing vital working capital.
There are many finance options out there, whether it be a business overdraft, business loan, asset-based lending or invoice finance; the ideal finance option for a business will depend entirely on their requirements, but for the recruitment industry, invoice finance or invoice discounting work tremendously well.
How does invoice finance work?
Invoice finance allows businesses to release a percentage of cash (typically 80-90%) as soon as an invoice is raised. This removes the average waiting time of 30 to 40 days for a client to pay said invoice, giving you immediate access to crucial working capital.
When it comes to invoice finance, your finance provider will then be responsible for chasing payment from your client, before releasing the final percentage of cash upon receipt of payment. Alternatively, invoice discounting is entirely confidential, meaning the business itself remains responsible for chasing payment and the client is unaware that they use this finance facility.
Why is invoice finance ideal for the recruitment industry?
Invoice finance is particularly relevant to recruiters due to the nature of their work. Typically, an agency will pay temporary workers on a weekly basis but will only invoice clients for their work monthly. This can have a huge impact on cash flow for recruiters of any size, particularly during busy periods.
Invoice finance supports recruiters in bridging this gap between payment to workers and payment from their clients. Providing that all-important working capital to continue running and growing the business, not to mention freeing up valuable time for chasing payments.
Finding the right finance provider
There are many finance providers out there, but recruiters should seek out providers that have a strong and established history within their industry.
The majority of the Zodeq team, for example, began their career within recruitment. As a result of this, we know the ins and outs of the industry, its pain points and what makes businesses a success!
If you would like to find out more about our invoice finance services, get in touch today on 01244 617 087 or email [email protected].
