The Broker’s Role in the Factoring Transaction
What is your role in the factoring transaction? How involved should you be? Everyone has different feelings about the answers to these questions. This article will attempt to provide some general guidelines and helpful ideas.
The primary initial role a factoring broker must serve is as an “Educator”. First, you must educate the prospect about factoring, invoice funding, po financing, accounts receivable factoring. Understand the business problems your prospect is facing and explain how factoring may solve those problems. Assume the prospect knows nothing about factoring; don’t forget, factoring is a foreign, and often scary, concept to many entrepreneurs. Slowly walk the prospect through the benefits of factoring, with particular emphasis on the impact the benefits will have on his business. Also explain the logistics of factoring and what the factor is likely to expect of him.
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There are thousands of great deals out there. Many companies are unaware of the numerous types of financing available to them that banks don’t usually offer. We want to find these companies, educate them about the financing available, and fund them. Unfortunately, we often get caught up in deals that can’t be funded but don’t figure it out until two weeks of work have gone by. This ties up valuable time that can be spent pursuing profitable deals. Let’s explore a sample of common obstacles we often encounter. 
