Short-term solution: Escalating criticism of industry operators and increased competition will hinder industry growth

Limited access to credit and higher demand for more flexibility have drawn more consumers to the Invoice Discounting industry over the past five years. Industry offerings tend to improve working capital access for clients at a faster rate than traditional bank lending, in addition to providing enhanced flexibility with respect to the ultimate use of borrowed funds. However, industry operators have struggled to compete with traditional sources of funding. Furthermore, demand for short-term solutions to manage cash flow and working capital, such as invoice discounting, is expected to decline over the five years to 2022...purchase to read more.

Industry Statistics & Market Size
Annual Growth 12-17
Forecast Growth 17-22
Market Share of Companies

Industry Threats & Opportunities

  • Clients have increasingly turned to external competitors to maintain control over their sales ledgers
  • Hidden charges from operators discouraged small business owners from using invoice discounting
  • The growth in accounts receivable financing has come with escalating criticism
  • Industry Report - Industry Key Buyers Chapter

    The Invoice Discounting industry has a low level of concentration. Industry participants help improve a company's working capital and cash flow position, competing against large banks as well as a growing number of other providers of accounts receivable financing. Invoice discounting can give businesses immediate access to cash without having to attain traditional loans, which can be accompanied by restrictions on the use of the bank's capital. Serving as an alternative to traditional financing, most invoice discounting providers lend to small- and medium-sized businesses on a local basis, leading to a highly fragmented industry. Market share concentration has decreased in recent years as more operators enter the industry to satisfy the growing demand for invoice discounting services...purchase to read more.

    Additional Insights for the Invoice Discounting Industry

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

  • Superior financial management and debt management
  • Easy access for clients
  • Having a diverse range of clients
  • IBISWorld analysts also discuss how external factors such as Access to credit and Corporate profit in the Invoice Discounting industry impact industry performance..

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    What's in this report

    What is the Invoice Discounting Industry?

    This industry provides short-term financing in exchange for business invoices or accounts receivables. Operators mainly generate revenue through factors fees or through the difference between the price paid for the invoice and the money received from debtors.

    Industry Products
  • Invoice discounting - advances against debt
  • Asset-based lending - advances against debt
  • Asset-based lending - advances against stock
  • Asset-based lending - advances against plant and machinery
  • Asset-based lending - advances against property
  • Asset-based lending - advances against other assets
  • Industry Activities
  • Providing invoice discounting
  • Providing asset-based lending
  • Table of Contents

    Industry Definition
    Main Activities
    Similar Industries
    Additional Resources
    Industry Statistics Snapshot
    Industry Structure
    Executive Summary
    Executive Summary
    Key External Drivers
  • Access to credit
  • Corporate profit
  • Prime rate
  • Business sentiment index
  • Number of businesses

  • Current Performance
  • Explanations of decline
  • Increasing costs to lend
  • Technology improves efficiency
  • Chart: Revenue Growth

  • Industry Outlook
  • Regulatory differences and criticism
  • Difference from factoring and client characteristics
  • Table: Invoice Discounting Industry Revenue Outlook

  • Industry Life Cycle
  • Life cycle reasons
  • Chart: Benchmarking - Invoice Discounting Industry Lifecycle vs The Economy

  • Supply Chains
    Key Buying Industries
  • Construction
  • Manufacturing
  • Wholesale Trade
  • Retail Trade
  • Transportation and Warehousing

  • Key Selling Industries
  • Commercial Banking
  • Credit Unions
  • Trusts & Estates

  • Products & Services
  • Invoice discounting - advances against debt
  • Asset-based lending - advances against debt
  • Asset-based lending - advances against stock
  • Asset-based lending - advances against plant and machinery
  • Asset-based lending - advances against other assets
  • Asset-based lending - advances against property
  • Chart: Invoice Discounting Industry Products and Services Segmentation

  • Demand Determinants
    Major Markets
  • Services
  • Manufacturing
  • Distribution
  • Transportation
  • Other
  • Construction
  • Retail
  • Chart: Major Market Segmentation for the Invoice Discounting Industry

  • International Trade
    Business Locations
    Chart: Business Locations by State
    Market Share Concentration
    Key Success Factors
    Cost Structure Benchmarks
  • Profit
  • Wages
  • Other
  • Chart: Cost Structure Benchmarking – Sector vs Invoice Discounting

  • Basis of Competition
    Internal competitionExternal competition
    Barriers to Entry
  • Table: Barrier to Entry Checklist for the Invoice Discounting Industry

  • Industry Globalization
    Interface Financial Group,
  • Table: Interface Financial Group - financial performance

  • Capital Intensity
  • Chart: Level of Capital Intensity for the Invoice Discounting Industry
  • Chart: Tools of the Trade: Growth Strategies for Success

  • Technology & Systems
    Revenue Volatility
  • Chart: Volatility vs Industry Growth

  • Regulation & Policy
    Industry Assistance
    Table: Industry Data for the Invoice Discounting Industry
  • Industry Revenue (2008-2022)
  • Industry Gross Product (2008-2022)
  • Establishments (2008-2022)
  • Businesses (2008-2022)
  • Employment (2008-2022)
  • Wages (2008-2022)
  • Access to Credit (2008-2022)

  • Table: Annual Percentage Change for Key Industry Data
    Table: Key Ratios for Industry Key Data
  • A financing arrangement in which a business sells its accounts receivable at a discount.
  • Sales Ledger
  • A detailed breakdown of a company's sales, presented in date sequence.
  • Working Capital
  • Calculated as current assets minus current liabilities, it is primarily a measure of a company's short-term financial health.
  • What Our Customers Say

    Why buy this report?

    IBISWorld’s Industry Market Report on Invoice Discounting is a comprehensive guide to market size and growth prospects. Ensure due diligence in your research with our strategic analysis of the factors influencing companies, including new product developments; economic, lifestyle and demographic influences; distribution and supply chain factors; and pricing issues.

    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 Invoice Discounting:
    • 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 Invoice Discounting 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 Invoice Discounting, you can expect thoroughly researched, reliable and current information that will help you to make faster, better business decisions.

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