Glenn Blackman of Cashflow Acceleration Limited argues that to market and sell invoice finance, it is important to understand how prospective clients make choices between different providers.

“We started out by trying to understand whether prospective clients had a preference for bank owned invoice finance companies or independent companies. We then questioned them about the reasons for their choices and this gave a lot of insight into how they choose between different providers.

“In terms of a preference between bank owned and independent invoice finance companies our survey of 100 SMEs revealed that:

• 56% of SMEs would prefer an independent invoice finance company
• 33% of SMEs would prefer a bank owned invoice finance company
• 11% of SMEs had no preference

“Of the 56% that said they would prefer an independent provider, these were their reasons:

• 41% Personal service
• 13%  Trust issues over recent events in the economy
• 9%  Customer focused
• 9%  Flexibility
• 9%  Reliable
• 7%  Not having “all eggs in one basket”
• 5%  No foreign call centres
• 5%  Not being just a number
• 2%  Less risk

“Of the 33% that said they would prefer to use a bank owned provider, these were their reasons:

• 73%  Well known name
• 15%  Professional
• 12%  Reliable

“These results are of value to all invoice finance companies, whether bank owned or independent. The value comes from continuing to appeal to prospective clients that have a preference for your type of provider but to also in trying to exhibit the aspects of the other category of provider in order to win more business. For example, an independent invoice finance company could work on building their brand to become a “well known name” and hence appeal to customers that may otherwise have chosen a bank owned provider.”

Glenn Blackman MBA MCIM writes regarding invoice finance and related matters at: www.glennblackman.co.uk. Glenn is also the Managing Director of Cashflow Acceleration Limited, a specialist invoice finance brokerage.