XL Business Finance has recently helped a business import wine from France. Although the business had recently been formed and was therefore unable to obtain funding from a high street bank, the business had a large confirmed order from a well known supermarket. The import finance company was able to provide a finance facility on the back of the confirmed order. 100% funding was provided to the customer to import the wineand upon delivery to the supermarket a factoring facility provided an additional 90 day funding. A complete funding solution was provided from start to finish. Stand alone import finance is also available but it certainly helps when it comes to obtaining funding if you either have confirmed orders or a track record
Archive for April, 2011
Import Finance
Sunday, April 10th, 2011International Trade Finance Explained
Saturday, April 9th, 2011Trade finance can cover business exporting goods and services ( export finance) or it can cover business importing goods and services ( import finance). Whilst certain high street banks can be very good at providing import and export facilities there are alternatives that can help businesses that are not eligible for bank funding for whatever reason. Again with any type of funding it is possible to obtain alternative views from specialist and independent trade finance company that can provide viable, flexible and competitive alternative to the banks. It is quite often possible to obtain a higher level of funding due to their expertise in particular market.
Is it getting easier to obtain business finance?
Friday, April 8th, 2011In our opinion obtaining business finance is still not getting any easier. Banks in particular are dammed if they do and dammed if they don’t. Onone hand we can proportion some of the blame to the banks for their cavalier lending policy over the years. However don’t forget that the greed of the consumer and lack of regulation from the government is partly to blame. On the other hand the banks have crawled into their shells mainly through lack of availability of cash but also because the quality of the applications they are seeing probably doesn’t meet their lending criteria. Admittedly the lending criteria has probably tightened but who came blame the banks when most of the UK’s SME businesses appear to be on a knife edge.
The good news is that their there are plenty of independent business finance insitutions coveing invoice discounting , factoring , commercials mortgages, trade finance and asset based lending providing viable and accessible alternatives to the high street banks
Invoice Discounting and bad debt protection
Wednesday, April 6th, 2011It is commonly thought that bad debt protection or credit insurance can only be provided by the the incumbent invoice discounting or factoring company. It is a little known fact that credit insurance can be provided by an independent third party.
Often the bolt on products provided by banks and high street factoring and invoice discounting companies can be expensive and provide inferior cover. An independent can often provided greater levels of cover for the same customers , at a lower cost and with more protection. As far as we are aware there is only one or two high street finance companies that provide bad debt protection in the event of a protracted claim. Most high street funders only pay out in the event of insolvency which is in contrast to most independent insurance companies that as a matter of course provide cover in the event of a protracted dispute. Worth comparing then
Factoring for a new start business
Tuesday, April 5th, 2011In theory obtaining a factoring facility for a new start business should be a relatively easy process. However we would advise that you consider a specialist factoring company that isn’t necessarily attached to a high street bank. Most finance companies will offer a facility providing that your debtors are of a decent nature. If you are starting off we only one or two customers then it is important that you obtain credit insurance. If your one and only customer were to go bust this would have disastrous consequences for your business and will potentially leave you personally exposed as you will have been asked to provide personal guarantees.
Obtaining the cheapest leasing and hire purchase rates
Monday, April 4th, 2011Obtaining the cheapest leasing and hire purchase rates depends not only depends on the strength of the covenant but also on the quality of the information provided. As with any transaction the easier you make it for an underwriter to understand the proposition the more chance you have getting a deal agreed in the first place and therefore the better the chance of getting a decent rate.
Therefore with any transaction a full set of audited accounts should be provided, most recent mangement accountss, 3 months bank statrements, details of any finance agreements coming to the end of the agreement and a clear rational will also help
Beware of refactoring charges
Sunday, April 3rd, 2011The most common recourse period offered by a factoring company is 90 days. If at the end of 90 days and your customer hasn’t paid their invoice many factoring companies charge a refactoring charge which can be anything from 0 .25% to 2% of the outstanding invoice. Ouch! Most factoring companies will not even mention this but leave it the small print. Call me cynical but there seems to be an incentive not to collect your invoices in time. If you are switching to factoring make sure that you choose business which as a good reputation and has the ability to collect payments quickly and efficiently. A tip small independents tend to be better at this than high street banks.
Replacing an overdraft with invoice finance
Saturday, April 2nd, 2011We are still seeing so many businesses struggling for cash flow with inadequate working capital facilities and replacing their bank overdrafts with invoice finance. Bank overdrafts are not designed to grow as a business expands and believe it or not there are many businesses out there that seemed to have turned the corner. This seems very much to be the case in the manufacturing and engineering sector which seems to be very very buoyant at the moment. Invoice finance by either factoring or invoice discounting can release cash against 85% of a businesses unpaid invoices. In many instances this can create cash far in excess of any bank overdraft facility is capable of doing.
XL Business Finance sells to Middle Eastern investors for £300M
Friday, April 1st, 2011Middle Eastern investors have reportedly purchased XL Business Finance for £300m! Due to the dwindling oil resources in the middle east a consortium of investors feel the future is with asset based lending in the UK and have teamed up with XL Business Finance as their chosen funding partner. A signing on fee of a cool £50m is reported to have been negotiated for XL Business Finance founder and owner Mark Redman. A not such a daft fee considering the fee paid recently by Chelsea Football Club for Torress. At the time of press release Mark Redman was unavailable for comment as he has apparently done one to some boiling hot holiday destination and never to return. Dream on!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
