Matthew Kimberley

Self-promotion does not equal personal branding.

When your brand is “right”, self-promotion’s not needed.

Let your fans promote your brand while you build it.

A factoring company is possibly the single most important supplier a contract recruitment agency can have, after your contractors themselves.

Invoice factoring keeps your company cashflow manageable. For recruitment companies placing temps or contractors, you need to pay your contractors (often months) before your client settles your own, outgoing, invoice.

Factoring companies make this possible. Here’s how:

1. Contractor submits timesheet and invoice to agency.
2. Agency raises outgoing invoice for client.
3. Agency assigns (sells) outgoing invoice to factoring company.
4. Factoring company immediately pays agency a percentage of invoice amount. Percentage depends of credit-worthiness of client.
5. Agency immediately has sufficient funds to pay contractor. Contractor is happy.
6. Agency can forget about chasing invoices. Client pays factoring company directly. Any delays, it’s the duty of factoring company to pursue outstanding amounts. Agency is happy.
7. Once client has paid, factoring company transfers balance to agency’s account, minus their administrative charge. Factoring company is happy.

It’s as simple as that.

You should communicate in advance to your factoring company which clients you’ll be working with. They’ll get back to you and tell you what credit limit they’ll be happy to assign to any particular client. If they deem that the risk of defaulting is high, you’ll know in advance and can dictate terms accordingly.

Using credit insurance and factoring companies doesn’t eliminate risk of non-payments, but carefully managed, it reduces this risk to negligible, as you have an agreement, in advance, that the large part of all of your invoices will be covered by a third party.

It’s often said that cashflow problems are the bane of new businesses. Even very small contract recruitment agencies will see holes of many hundreds of thousands of pounds/euros/dollars a few months into operations. That’s why, for me at least, sourcing a good factoring company as a key supplier is a no-brainer.

Further reading:

• Factoring on Wikipedia
• Debt Factoring and Invoice Discounting on Business Link

Cameron Herold, of Backpocket COO, has published a fantastic guest post on Tim Ferriss’ excellent Four Hour Work Week blog.

I would urge all business owners to read this. It’s an articulation of the emotional rollercoaster that entrepreneurs go through during the phases of building a business. It has innate value.

Herold is an impressive figure. In the below video he discusses his “Painted Picture” – a visualisation of goals and where you and your company will be in the future.

I’ll be doing that this weekend, using Herold’s own Painted Picture as a foundation.

I’m just getting to the last few chapters of The Eddie Stobart Story by Hunter Davies.

Eddie Stobart is a family firm of truckers in the UK who are now one of the country’s leading haulage firms.

The brothers suffered with dyslexia and speech impediments, with no formal business training, and yet they’ve gone on to become the single most recognised and respected brand in UK logistics.

Ed Stobart Jr, founder of the company, seems to put his success down to two main elements: never saying no to a job, and keeping his staff in uniforms and his trucks spotlessly clean.

The Sunday Times recently ran a “Profit Track 100” supplement, listing the companies with the fastest profit growth in the country. With the exception of two of these companies, they’re all companies in markedly non-sexy industries: construction, timber, oilfield services, engineering … probably all keeping their engines clean and their clients happy.

The moral of this story? Wash behind your ears and do what you’re doing just a little bit better.

Most of us are unlikely to found the next killer tech start-up, but if we can deliver on time in a shiny vehicle, we’re already doing a bit better than a lot of the rest.

Howdy! Back from Mexico with a tan that’s fast fading …

In my last post I quoted Tim Ferriss as saying “I believe that success can be measured in the number of uncomfortable conversations you’re willing to have”. This week I’ve come across two more articles which mention the notion of uncomfortableness:

The Duct Tape Marketing Blog, a guide to making a success of your business on a shoestring, has the following:

“Get Uncomfortable on Purpose! – Your wealth, your success, will correspond directly with the size of your mindset. Get in front of an audience and speak, write for an industry publication, start blogging, network with prospects, write personal thank you notes. Let someone else be in charge or take the credit for success. You can’t grow unless you are uncomfortable – embrace it!. Write a book. Start a radio show. Create a podcast. You are so much bigger than you are allowing yourself to be. Reach.” – The ultimate secret to business growth

While ere.net, the recruiting blog network, has “the difference starts with you … THINK UNCOMFORTABLE. Do what you think you cannot do. You will find it is very cool.”

My company is toying with a marketing product that I haven’t seen used before in the recruitment industry. I won’t go into too much detail yet, but I can imagine it’s something that would make a lot of recruitment consultants hide away under their desks when it came to their turn. I don’t yet know if it will work, but I’m prepared to stick my neck out and give it a go. Will report back here, of course.

Guy Kawasaki in his blog How To Change the World has a guest post from Scott Shane, a director of Entrepreneurial Studies at a US university. He writes some fascinating stuff about the myths that surround the start-up, as well as some hard statistical home truths:

“Seven years after beginning the process of starting a business, only one-third of people have a new company with positive cash flow greater than the salary and expenses of the owner for more than three consecutive months.”

If you’re hesitating about breaking out on your own, I recommend you read it all. Together with “duct-tape marketing” ideas, you should be well-set.