The third leg of our factoring stool is portfolio and operations management. This leg is also a very human capital driven market.  While you may have the money and the sales force to spread your money on the streets, you also must have great staff in the back room to get your money back profitably. It requires talented individuals to underwrite the transaction on the way in the door, to manage the flow of monies to and from the client, to consistently check the credit of the account debtors, and to collect and work out of situations that always arise from dealing with distressed clients. This is a very specialized industry for which there is no college degree, only on-the-job training.

I would like to offer an observation about really great portfolio managers, underwriters, and account executives in our industry. The science of what they do is obvious (or it should be), and yet it is the job’s nuances and art that separate the wheat from the chaff. As any head of group knows in the factoring industry, the bad ops people can cost you the company, the mediocre will eventually cost you something, the good will protect you most of the time and the great ones will alert you long before there is even a challenging situation. As with the sales people above, the very best are absolutely worth the monies they are paid and the ones who are not trained correctly or just do not know the challenges of the industry can be the most costly mistake your company ever makes.

For these reasons, I would separate the operations people based on experience simply because experience absolutely does matter in our industry.  For an account executive with two to five years experience, the range would be $35,000 to $50,000.  For five years through approximately ten years, it would probably move to $50,000 to $80,000 range. After ten years, these professionals would most likely move to portfolio management supervising account executives, head of operations or other similar positions of authority. In these senior positions, the range is from $75,000 to $150,000 depending on the number of direct reports, the responsibilities of the position, the size of the portfolio, etc.

In the underwriting category, these are usually individuals with a minimum of five years experience in a factoring operation, and they typically earn from $65,000 to $110,000. Again, this depends on the number of years experience, type of transactions and knowledge of the various industries typically factored. Lastly, presidents and heads of group positions in the industry are all across the board depending on many different facets of the operational and P&L responsibilities.