Factoring turnover grows by 28% during 2011
Announcement posted by FCR (Financial & Corporate Relations Pty Limited) 02 Mar 2012
Sydney, 02 March 2012 – The latest statistics from the Institute for Factors and Discounters
(IFD) for the December 2011 quarter, released yesterday, confirmed that there was an average
increase in factoring turnover of 28% across the four quarters of 2011 compared to 2010. At
the end of the December quarter, factoring turnover was $1.3 billion.
The growth in total factoring turnover was due to an increase in both the number of clients
using factoring and the volume of invoices across all clients. During the 2011 year, two new
parties commenced participation in the reporting and two other parties withdrew.
The Manufacturing sector shrank from 23% of the factoring market in March 2011 to 11% in
December 2011, whereas the Labour Hire sector grew from 25% to 34% over the same period.
Greg Charlwood, Managing Director, Bibby Financial Services Australia, said: “This data
supports the picture of Australian SMEs being under cash flow pressure, particularly small and
medium sized manufacturers which are struggling not least because of the high Australian
dollar. On the other hand, we feel that the strong representation of labour hire in these
statistics points to employers increasingly employing staff on a casual basis and using labour
hire companies to provide casual and contract staff, due to changes in workplace legislation
and general uncertainty in the economy.
“The overall growth in factoring confirms what our clients tell us. Small businesses face a more
uncertain cash flow than a year ago, and are increasingly looking for innovative ways to
manage their cash flow, including debtor finance.
“At a time when Australian banks are continuing to be conservative in their lending to SMEs,
debtor finance is growing in popularity and outperforming other types of commercial lending
because it doesn’t require property as collateral and it grows in line with a business. This
makes it an ideal form of growth funding for small and medium sized business owners who do
not want to risk their personal assets,” he said.
“At the end of the December 2011 quarter, 4647 Australian businesses were using factoring
and discounting, according to the IFD statistics. Many of these SMEs are strong, growing
businesses, and the reduced access to finance via the banks is a significant source of
frustration to them. We are seeing the same trend overseas with SMEs in other parts of the
world including Europe equally frustrated with their banks,” he said.
“The continuing growth of the thriving non-bank SME lending sector in Australia is a positive
result of this situation. Bibby itself, which is one of the world’s largest non-bank specialists in
debtor finance and a 200 year old company, grew by 25% in 2011 in Australia, and we expect
to grow by a further 30% in 2012,” he said.
ENDS
Media contacts
Rebecca Murray, FCR: t (+612) 8264 1002/ +61 423 338 005
Andrew Briggs, Bibby Financial Services (Aust): t (+612) 9310 8921/ + 61 403 096 807
Bibby Financial Services is the largest global independent specialist provider of invoice finance
(also known as invoice finance, factoring, cash flow finance and invoice discounting) - a flexible
and accessible cash flow funding tool for small and medium sized businesses. It maintains a
network of 32 companies and services approximately 5,400 clients in 14 countries worldwide,
including the UK, US, Canada, France, Germany, Ireland, The Czech Republic, Sweden,
Slovakia, Poland, India, Hong Kong, Australia and New Zealand. It is part of the Bibby Line
Group, a family-owned business-to-business services group with origins in shipping dating
back over 200 years to 1807.
Invoice finance is designed to improve business cash flow and support business growth by
releasing cash tied up in unpaid invoices. Unlike other funding arrangements, no real estate
security is required, making it more accessible for small and medium sized business owners.
For more information on Bibby Financial Services please visit www.bibby.com.au
(IFD) for the December 2011 quarter, released yesterday, confirmed that there was an average
increase in factoring turnover of 28% across the four quarters of 2011 compared to 2010. At
the end of the December quarter, factoring turnover was $1.3 billion.
The growth in total factoring turnover was due to an increase in both the number of clients
using factoring and the volume of invoices across all clients. During the 2011 year, two new
parties commenced participation in the reporting and two other parties withdrew.
The Manufacturing sector shrank from 23% of the factoring market in March 2011 to 11% in
December 2011, whereas the Labour Hire sector grew from 25% to 34% over the same period.
Greg Charlwood, Managing Director, Bibby Financial Services Australia, said: “This data
supports the picture of Australian SMEs being under cash flow pressure, particularly small and
medium sized manufacturers which are struggling not least because of the high Australian
dollar. On the other hand, we feel that the strong representation of labour hire in these
statistics points to employers increasingly employing staff on a casual basis and using labour
hire companies to provide casual and contract staff, due to changes in workplace legislation
and general uncertainty in the economy.
“The overall growth in factoring confirms what our clients tell us. Small businesses face a more
uncertain cash flow than a year ago, and are increasingly looking for innovative ways to
manage their cash flow, including debtor finance.
“At a time when Australian banks are continuing to be conservative in their lending to SMEs,
debtor finance is growing in popularity and outperforming other types of commercial lending
because it doesn’t require property as collateral and it grows in line with a business. This
makes it an ideal form of growth funding for small and medium sized business owners who do
not want to risk their personal assets,” he said.
“At the end of the December 2011 quarter, 4647 Australian businesses were using factoring
and discounting, according to the IFD statistics. Many of these SMEs are strong, growing
businesses, and the reduced access to finance via the banks is a significant source of
frustration to them. We are seeing the same trend overseas with SMEs in other parts of the
world including Europe equally frustrated with their banks,” he said.
“The continuing growth of the thriving non-bank SME lending sector in Australia is a positive
result of this situation. Bibby itself, which is one of the world’s largest non-bank specialists in
debtor finance and a 200 year old company, grew by 25% in 2011 in Australia, and we expect
to grow by a further 30% in 2012,” he said.
ENDS
Media contacts
Rebecca Murray, FCR: t (+612) 8264 1002/ +61 423 338 005
Andrew Briggs, Bibby Financial Services (Aust): t (+612) 9310 8921/ + 61 403 096 807
Bibby Financial Services is the largest global independent specialist provider of invoice finance
(also known as invoice finance, factoring, cash flow finance and invoice discounting) - a flexible
and accessible cash flow funding tool for small and medium sized businesses. It maintains a
network of 32 companies and services approximately 5,400 clients in 14 countries worldwide,
including the UK, US, Canada, France, Germany, Ireland, The Czech Republic, Sweden,
Slovakia, Poland, India, Hong Kong, Australia and New Zealand. It is part of the Bibby Line
Group, a family-owned business-to-business services group with origins in shipping dating
back over 200 years to 1807.
Invoice finance is designed to improve business cash flow and support business growth by
releasing cash tied up in unpaid invoices. Unlike other funding arrangements, no real estate
security is required, making it more accessible for small and medium sized business owners.
For more information on Bibby Financial Services please visit www.bibby.com.au