Factoring brokers earn a commission from factoring companies for clients that they place with them so conversely if they don’t place any business they won’t earn anything.
There are quite a few tricks that the unscrupulous broker will get up to in order to ensure that they win the deal. Recently Factoring Solutions (IFBA member) received a telephone call from a recruitment company who weren’t happy with the service provided by their payroll / funding provider and who telephoned FS to ask whether they could introduce them to a more efficient company.
The company told FS that they had spoken to another factoring broker who having taken down all of the details said that they would make some enquiries and get back to them.
The other broker (who is a large and high profile outfit) didn’t want to give his recommendations until he had spoken to the factoring company concerned to make sure that they hadn’t received the enquiry from another source. If they had, the broker would have contacted yet another factoring company and kept going until they found one that someone else hadn’t approached first.
The moral of the story is that if you approach a factoring broker and they need time to go away and think about who to recommend you to, they will be acting in their own best interests and not yours.