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Hotchbaby Hotchbaby is offline
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Join Date: Apr 2008
Posts: 12
How high a Percentage Return

I apologise for the title, I'm not the best at expressing myself.

I'm planning on selling stuff to customers on credit, borrowing the money needed from the bank. Now obviously i need to make more then the bank charge, but how much more?

Obviously it depends on risk, etc.

Any thoughts?

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moneyman's Avatar moneyman moneyman is offline
Join Date: Nov 2005
Location: Norwich and Aberdeen
Posts: 974
That sound like a bed idea. Money laundering, financial regulators blah blah bad debts etc.

why not offer vendor finance? That is the sort of thing you sign up when you buy a car. The finance company does the debt stuff, you get the cash (often a percentage as well) and the risk is theirs. Get onto lombard or barclays capital etc.

Otherwise you aint been paid until the last payment is made and the debt chasing will cripple you.
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Hotchbaby Hotchbaby is offline
Starting Out
Join Date: Apr 2008
Posts: 12
Ah, getting the money out of them shouldn't be too hard. Infact, it is pretty impossible for them to avoid, and can cut them off if they don't, so no worries there really. Especially when the consumers are schools, universities etc who aren't I'm pretty sure i can trust anyway. Don't want another middle man, as that's essentially what i will be. Also, i'll be making my profit from half way through payments.

It's not exactly credit either, giving them the product and them paying me the money they make from it, i don't know. Pretty sure i should be ok.
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m8internet m8internet is offline
Join Date: Apr 2008
Location: Cumbernauld, Scotland
Posts: 772
If you are offering any customers credit, either through your own finances, your company, or an agent, then you need to register under the Consumer Credit Act

Personally, there are too many hoops to jump through so I run a "no tick" account service
All are accounts are paid, and we only commence work once have received them

However you can extend "soft credit" to existing customers without any need to register
This normally given to cutsomers who you have been trading with for 6 months or more
You then allow them 30 days to make payment, and the important bit, WITHOUT charging them any interest
Again, if you want to charge them interest then you will need to register
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James Smith's Avatar James Smith James Smith is offline
Join Date: Mar 2003
Location: Abingdon, Oxfordshire
Posts: 2,043
Echo other posts above - its not a very good idea from either a business point of view or a regulation point of view.


1. why would schools pay your (and its going to be high) credit terms?
2. Why do you suppose the bank will lend to you in the first place?

back to the drawing board I think!

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Hotchbaby Hotchbaby is offline
Starting Out
Join Date: Apr 2008
Posts: 12
Well, I guess i havn't explained it well, but the 3 schools i currently have this arrangement with (maybe it's illegal, o well) are making money from it, and the general theory as to why they'd do it with me was simple EoS.

2. Becuase it's pretty much risk free (probably won't believe me, i wouldn't :P), and it's working atm.

I'll try elsewhere.

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chrisclayts's Avatar chrisclayts chrisclayts is offline
Join Date: Apr 2008
Location: Devon
Posts: 24
Just an echo that this doesnt sound like a good idea... but if you do go through with it please let us know how you get on. javascript:smilie('')

I have found there are lots of watch sellers now online which only sell with finance plans... interesting concept I thought.
Chris C
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