In My View: Invoice discounting keeps the cash flowing for Index Recruitment

Edward and June Percival, owners of The Index Recruitment Group, remember the last recession in the early nineties only too well.

The couple's business, now an International recruitment specialist and e-business services group, really felt the pressure as Banks toughened up on their lending criteria and increased their rates, forcing many SMEs to the wall.

"When the last recession started to bite, our banking partner at the time almost crucified us by reining in our overdraft facility," says Edward Percival whose 50-strong company is headquartered in Fleet, Hampshire.

Banks clamping down on available capital is bad news for any small business but for a firm operating in the recruitment industry it can make life particularly difficult.

Due to the nature of contract recruitment, it is often the case that funds can run low despite having a number of successful, expanding, ongoing contracts in place.

As the couple explain, "It could have been a real disaster for us. Each week we have literally hundreds of temps and contractors to pay across a number of sectors and we are obviously heavily reliant on a regular stream of cash."

The Percivals' accountants suggested that they look at alternative routes to finance the business. The accountancy firm recommended confidential invoice discounting as an advantageous way to release cash-flow and fund future business operations.

The recruitment specialists began to search for a factoring and invoice discounting company that would provide ongoing support and service through both the ups and downs of everyday business. Luckily, in Close Invoice Finance, they found a supplier that not only met but exceeded their expectations.

The Percivals continue, "By turning to Close Invoice Finance we gained the financial support and stability which enabled us to rebuild and forge ahead. Knowing we had access to the cash we needed to operate the business allowed us to confidently trade without being overly reliant on the Bank and any overdraft facility. Quite simply, it gave us total peace of mind."

"Unlike our Bank, Close were specialist, fleet of foot and provided a really personal service. We were even on first names basis which is reassuring when you're navigating your way through a difficult trading period. We had not had that level of service from our Bank."

So what do they think about the current credit crunch?

"Right now, we're not concerned. But if we were reliant on a Bank and an overdraft facility that could be withdrawn at any moment, then we're sure it would be a very different story."

"As it is, we feel pretty bullish about the future. With strong financing in place, we can focus on expanding the business that we have spent the last twenty years building up."

David Thomson, Chief Executive of Close Invoice Finance said "Index Recruitment is a classic case of how we can help our clients in a way that major banks can't. It is an excellent relationship and we are exceptionally proud that they consider us as part of their team."

If you'd like to find out more about how Close's portfolio of invoice discounting and factoring services can support your business please visit www.closeinvoice.co.uk or call 0800 220 257 to discuss your requirements.