Case Study: Tina’s Amazing New Car Factoring Client

How a factoring broker earns a new car lease for 18 years

Sometimes, it is easy to “gloss over” the power of business types that offer residual income and the business of factoring broker is one that not only offers residual monthly commission income but offers such income for the life of account. This broker, who we will call “Tina,” has referred a small construction cleanup account to a factor that has been a provider of monthly commissions for eighteen years. In fact, at an average monthly broker commission paid, Tina calls this account her “New Car Account” because, due to the average commission of slightly over $250 monthly, she has been able to pay (and enjoy) a new vehicle for 18 years due to this single referred account.

Tina’s Story  

Tina was a discount note/cashflow broker who discovered factoring and business finance as a lucrative (and powerful) additional service she could add to her current business of purchasing discount mortgage notes. In fact, factoring and business finance were very common add-ons for cash flow consultants due to their residual income features and ease of marketing since leads could be generated easily using direct mail and her website. She offered a free booklet on factoring through her mailings, and one of her first leads and accounts was a painting contractor who strictly provided services to apartment complexes. When a tenant moved out, his crew then painted the apartment interior, made small repairs, and made the dwelling ready to re-rent.  

The management companies that paid the contractor were notoriously slow payers, but it was good business and a great niche. The contractor was a perfect candidate for factoring and became her very first client, where she earned over $500 monthly in commissions on average. However, that is just part of the story.

Within a few months, her contractor client gave her a referral. His referral was a local commercial cleaning company that a friend operated. His referral was not as large as the contractor’s, but this referral, a minority business enterprise, received good contracts and provided Tina with her second factoring client.

Time Passes

Though she started in factoring strictly part-time, Tina became a “professional” freelance factoring and business finance consultant over time and it did not take long until her six-figure annual income far-eclipsed her income earned in her mortgage note business primarily due to the residual month-month income from factoring. Over time, her initial client, the painting contractor, no longer needed her services, and although she received commission income for nearly four years, the contractor eventually qualified for a large bank loan. The commercial cleaning company, however, has been a different story.  

Tina is now a complete factoring consultant success, having been in the industry for nearly 20 years. While her clients come and go, she has expanded her services to SBA loans, international factoring, merchant cash, and more. Her business as a broker has matured, and her active prospect list in her CRM is now over 13,000. She now does little new marketing and is able to bring in new clients routinely from past work and an expansive list of referrer sources.

As a well-established broker, Tina routinely has clients that use her services in factoring for 3 years, 5 years, and even 7 years and longer. Her longest factoring client, however, has been her very first referred client (commercial cleaning company), who has been an active factoring commission-generating client for eighteen-plus years. She refers to this client as her “New Car Client” since the average commission earned from this small cleaning company has been (each and every month for 18 years) on average $250. This single monthly residual commission has provided her with a shiny new vehicle lease for the last 18 years.