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Factoring in the UK: Market Research Report

Market Research • Market Size • Industry Statistics • Industry Analysis • Industry Trends

Factoring Market Research Report | SIC K64.992 | Mar 2017

Important factors: Operators have benefited from high business confidence and changing legislation

IBISWorld’s Factoring market research report is a comprehensive guide to market size and growth prospects. Our industry reports offer strategic industry analysis of the factors influencing companies, including new product developments, economic, lifestyle and demographic influences, distribution and supply chain factors and pricing issues. Full analysis accompanies our data forecasts to illustrate how the market responds to emerging industry trends.

Report Snapshot
Market Share of Companies
Bibby Financial Services Ltd Bibby Financial Services Ltd market share
HSBC Invoice Finance (UK) Ltd HSBC Invoice Finance (UK) Ltd  market share
Lloyds TSB Commercial Finance Limited Lloyds TSB Commercial Finance Limited market share
RBS Invoice Finance RBS Invoice Finance market share
Industry Statistics & Market Size
Revenue
£3bn
Annual Growth 12-17
3.8%
Annual Growth 17-22
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Profit
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Employment
5,764
Businesses
82
Industry Threats & Opportunities
  • Difficulties in securing conventional loans have boosted demand, supporting industry growth
  • A substantial increase in factoring activity from SMEs has supported the industry’s growth
  • Interest rates are expected to rise over the next five years, benefiting industry demand in the short term
  • ... purchase to read more

Industry Analysis & Industry Trends

Factoring is a short-term financing option to increase a business' liquidity. Operators also purchase accounts receivable and unpaid invoices at a discount in return for immediate receipt of money. Industry revenue is expected to grow at a compound annual rate of 3.8% over the five years through 2016-17. Over the past five years, demand for factoring services has been propelled by difficulties in securing conventional loans. Improving economic conditions, rising business confidence and an expansion in UK business numbers also contributed positively to the industry's performance. However, difficulties associated with adequate funding, strict lending criteria and the low interest rate environment constrained growth.

In 2016-17, revenue is expected to rise by 2.5% to £2.7... purchase to read more

Industry Report - Industry Locations Chapter

Factor providers are generally concentrated around business centres, particularly in close proximity to operators in the three major market segments: manufacturing, distribution and service businesses.

London

London has the highest concentration of industry establishments, at approximately 40.8%. London is one of the world’s largest financial centres and also has a high concentration of service-providing businesses. These factors make it an attractive location to establish operations.

The South East

The South East has the second-highest concentration of industry establishments, with approximately 15.6% of the total. The South East has high levels of manufacturing and distribution activity. The.. purchase to read more

Additional Insights for the Factoring Industry

IBISWorld identifies 250 Key Success Factors for a business.The most important for the Factoring Industry are

  • Ability to raise revenue from additional sources
  • Financial position of the company (as against financial structure)
  • Superior financial management and debt management
  • IBISWorld analysts also discuss how external factors such as Business confidence index and Number of businesses in the Factoring industry impact industry performance... purchase to read more

     


    Industry ProductsRelated Reports

    What is the Factoring Industry?

    Firms in this industry specialise in short-term debt financing and invoice discounting. Factoring involves a company selling its accounts receivables or invoices to a third party as a means of accessing cash to finance further business activity without having to wait for their debtors to pay them. Operators generate revenue through factor fees, or the difference between the price paid for the invoice and money received from debtors.

    Industry Products
    Domestic factoringInvoice discountingAsset-based loansOther factoring and related services
     
    Industry Activities
    FactoringInvoice discountingDebt financing


    Table of Contents
    About this Industry
    Industry Definition
    Main Activities
    Similar Industries
    Additional Resources
    Industry at a Glance
    Industry Statistics Snapshot
    Industry Structure
    Executive Summary
    Industry Performance
    Executive Summary
    Key External Drivers
  • Business confidence index
  • Number of businesses
  • Official bank rate
  • Industrial production index
  • Business profit
  • Current Performance
  • Steady growth
  • Recent developments
  • Margins improve
  • Chart: Revenue Growth
  • Industry Outlook
  • Demand factors
  • Growth limitations
  • Improving profitability
  • Future concerns
  • Table: Factoring Industry Revenue Outlook
  • Industry Life Cycle
  • Life cycle reasons
  • Chart: Benchmarking - Factoring Industry Lifecycle vs The Economy
  • Products & Markets
    Supply Chains
  • Key Buying Industries
  • Motor Vehicle Manufacturing
  • Pipeline Transport
  • Banks
  • Key Selling Industries
  • Accounting & Auditing
  • Financial and Insurance Activities
  • Tax Consultants
  • Products & Services
  • Invoice discounting
  • Asset-based loans
  • Domestic factoring
  • Other factoring and related services
  • Chart: Factoring Industry Products and Services Segmentation
  • Demand Determinants
  • Business activity and credit supply
  • Business confidence
  • Credit accessibility
  • Major Markets
  • Services sector
  • Manufacturing sector
  • Distribution sector
  • Other
  • Transport sector
  • Construction sector
  • Retail sector
  • Chart: Major Market Segmentation for the Factoring Industry
  • International Trade
    Business Locations
  • Chart: Business Locations by State
  • Competitive Landscape
    Market Share Concentration
    Key Success Factors
    Cost Structure Benchmarks
  • Profit
  • Interest
  • Loan losses, provisions and impairment charges
  • Wages
  • Purchases
  • Other costs
  • Chart: Cost Structure Benchmarking – Sector vs Factoring
  • Basis of Competition
  • Internal competition
  • External competition
  • Barriers to Entry
  • Table: Barrier to Entry Checklist for the Factoring Industry
  • Industry Globalization
    Major Companies
    RBS Invoice Finance Ltd
    HSBC Invoice Finance (UK) Ltd
    Bibby Financial Services Ltd
    Lloyds Bank Commercial Finance Ltd
  • Table: RBS Invoice Finance Ltd - financial performance
  • Table: HSBC Invoice Finance (UK) Ltd - financial performance
  • Table: Bibby Financial Services Ltd - financial performance
  • Table: Lloyds Bank Commercial Finance Ltd - financial performance
  • Operating Conditions
    Capital Intensity
  • Chart: Level of Capital Intensity for the Factoring Industry
  • Chart: Tools of the Trade: Growth Strategies for Success
  • Technology & Systems
    Revenue Volatility
  • Chart: Volatility vs Industry Growth
  • Regulation & Policy
    Industry Assistance
    Key Statistics
  • Table: Industry Data for the Factoring Industry
  • Includes:
  • Industry Revenue (2008-2022)
  • Industry Gross Product (2008-2022)
  • Establishments (2008-2022)
  • Businesses (2008-2022)
  • Employment (2008-2022)
  • Wages (2008-2022)
  • Table: Annual Percentage Change for Key Industry Data
  • Table: Key Ratios for Industry Key Data
  • Jargon & Glossary
    Asset-Based Lending
  • Short-term lending where a company's assets such as invoices, stock, plant, machinery or property are used as collateral to access funds for a short period of time to improve cash flow.
  • Crowdfunding
  • The practice of funding a project or venture by raising monetary contributions from a large number of people.
  • Invoice Discounting
  • A form of short-term funding where a business uses its invoices as collateral to gain funding from a finance company for liquidity and cash flow purposes.
  • Net Interest Margin
  • A measure of the difference between interest income generated and the amount of interest paid to lenders.

  • Why Buy this Report?
    IBISWorld industry market research reports enable you to:
    • Find out about key industry trends
    • Identify threats and opportunities
    • Inform your decisions for marketing, strategy and planning
    • Quickly build competitive intelligence
    This report on Factoring:
    • Provides Market Size information to assist with planning and strategic decisions.
    • Includes the necessary information to perform SWOT, PEST and STEER analysis.
    • Helps you understand market dynamics to give you a deeper understanding of industry competition and the supply chain.
    • Analyses key performance and operational metrics so that you can benchmark against your own business, that of your customers’ businesses, or your competitors’ businesses.
    The Factoring market research report includes:
    • Historical data and analysis for the key drivers of this industry
    • A five-year forecast of the market and noted trends
    • Detailed research and segmentation for the main products and markets
    • An assessment of the competitive landscape and market shares for major companies
    • And of course, much more

    IBISWorld reports on thousands of industries around the world. Our clients rely on our information and data to stay up-to-date on industry trends across all industries. With this IBISWorld Industry Research Report on Factoring, you can expect thoroughly researched, reliable and current information that will help you to make faster, better business decisions.

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