There are a number of schemes available to UK businesses during this time of uncertainty.
Archive for the ‘invoice discounting’ Category
GOVERNMENT SUPPORT FOR BUSINESS
Wednesday, April 1st, 2020Scale-up Businesses struggle to find funding
Monday, January 29th, 2018A scale-up business is recognised as a young organisation with at least 10 employees which grows by an average of 20% each year. Scale-ups are of huge importance to the UK economy providing jobs, inward investment and innovation.
However, scale-up businesses often find it difficult to source finance from mainstream funders due to a lack of trading history, asset value or limited management experience.
Grants and regional funding options exist, but many are for very early-stage development rather than growth. Bank Loans are an option for companies with solid cash flow that can support the interest payments. However, new global capital regulations designed to make banking more stable have made it harder for banks to offer large overdrafts, and so alternative options are often required by businesses looking to raise finance.
Invoice finance is a popular way for scale-up business-to-business (B2B) firms to unlock vital working capital as it grows with your business. Working capital finance options for high-growth business-to-consumer (B2C) firms are less obvious. However, a relatively new type of lender is emerging offering merchant cash advances where businesses repay a fixed percentage of revenues.
Many crowdfunding platforms exist, including equity and non-equity options. When it comes to investing in new equipment, there are plenty of options available. Asset finance, otherwise known as asset leasing or lease rental, has been around for many years and for good reason, but not everyone is aware of how it can benefit them.
Asset leasing is a tax-efficient and flexible way to purchase the equipment you need without compromising your cash flow, and is suitable for all industry sectors and any size of business. Terms are available from one to five years with only a minimal deposit required in most cases.
Ultimately, there’s no easy answer for financing a scale-up and businesses may need to share the risk and look at numerous options. It does depend on your approach to risk, your attitude to giving away part of business, and your company’s ability to finance a debt.
To see how we can help you grow your business by providing funding options to suit your needs, contact XL Business Finance today for an initial discussion.
Manchester – 0161 980 0577
London – 020 3301 4540
xlbusinessfinance.co.uk
Invoice Finance Facility Secured for multi-million pound enginering co
Tuesday, October 23rd, 2012XL Business Finance is delighted to have negotiated and secured a new and flexible invoice finance deal for a multi million pound north west based engineering company. Having 3 businesses within the group, multi currency accounts and a high level of export debt this deal was not going to be be for every finance company. Whilst the business was profitable an erratic trading performance over the last few years prevented their current high street bank from funding to appropriate levels. The good news was that a specialist invoice finance company was able to provide an increased £2.0m facility, funding at a higher prepayment, full export funding and cheaper credit insurance. Of the dozens of invoice discounting and factoring companies operating out of the UK only two or three are capable of transacting such a deal and XL Business Finance was able to use its experience and expertise within the industry to help the customer find the right funding solution.
Business Finance for the construction industry
Tuesday, January 10th, 2012Anyone involved in the instruction industry will know how difficult it is to obtain working capital facilities. Due to the contractual nature of invoicing and applications for payment traditional forms of invoice finance are not available. The good news is that there are two or three independent finance companies that can provide funding against contractual debt and application for payments.
Specialist invoice finance companies use their own QS’s to asses work and provide funding that traditionally isn’t available via the high street banks. Whilst prepayments might not be as high as traditional invoice finance and factoring facilities the ability to get 50 or 60% of outstanding payments provides vital working capital for many businesses. As with any form of business finance the finance companies in question are all very different animals and provide slightly different forms of funding. XL Business Finance with over 12 years of experience can help you with speaking to the right funder.
Avoid Becoming a Statistic
Wednesday, September 28th, 2011The Bank of England’s recent Credit Conditions Survey found that default rates on loans in Q2 increased for small businesses. By acting now, an invoice finance provider can help your business to avoid becoming part of these statistics.
In addition to trying to win new business, companies are equally concerned about whether their existing customers can pay, and on what terms. Businesses often rely on loans and overdrafts to provide the capital they need; in recent years however, a variety of invoice finance options, such as factoring have helped SMEs to ease their funding gaps.
Not only do these arrangements have more flexibility than bank loans, but they are quicker and tailored to a company’s specific requirements. In both good and challenging markets, invoice finance can provide the flexibility and access to capital that a business needs to thrive and grow. The annual cost of a factoring facility starts as low as 1% of sales so it is a very cost effective option for business owners.
Can Asset Based Lending provide an alternative to high street banks?
Monday, September 5th, 2011A traditional Asset Based Lender or ABL predominantly provides cash flow finance. The main facility they offer will be invoice invoice discounting however they can also provide stocking finance, plant and machinery finance/refinance and for the right customers commercial mortgages as well. Although the banks serve a purpose for many businesses the amount of facilities that are available are often dictated by the size of the balance sheet and and previous years trading performance. Therefore the level of available funding isn’t necessarily related to the amount of available security. How many times have you heard a business owner say that the bank has plenty of available security but the bank will not increase their facilities
ABL lenders look at things in a slightly different perspective. Whilst it is important that they buy into the business and are comfortable with its trading performance they are mainly concerned with the available level of security. An invoice discounting facility will provide funding of circa 85% of the unpaid debtors. They will also consider providing additional working capital secured against plant and machinery. They will lend anything up to 80% of its value depending on the circumstances around the deal. A true revolving stocking facility may also be appropriate and potentially commercial mortgage funding is also available. In addition an ABL lender is not necessarily after the clearing banking and as such you will be able to leave your clearing with your existing high street. This potentially makes for an easy transition to potentially more flexible and supportive funding arrangements.
Small Business Finance solutions
Friday, September 2nd, 2011We are still living in tough times financially throughout the UK with the emphasis falling on the small business. Finance can be hard to come by for the small business owner.
Often a small business must undertake a large capital equipment investment in order to grow. The balance sheet of the business is often not strong enough to justify a Hire Purchase or Finance Lease facility.
Without capital investment the business can not grow and become more profitable. A chicken and egg scenario.
Small Business Finance is an area in which XL Business Finance has a great deal of expertise. As an independent finance broker we understand the problems of small business finance, arranging equipment leasing and machinery finance for example.
At XL Business Finance we can provide small business finance for investments from as little as £1000. This could be useful for providing tax efficient leasing for office furniture, computer equipment and telephone systems for instance.
Do not think of us as a company who provides you with a one off service to get you up and running then disappears into the night. We work along side many clients for many years providing finance solutions such as factoring, debt factoring or factoring invoice discounting facility.
As an independent factoring broker XL Business Finance can provide you with the best Business finance to meet your specific requirements.
What is a factoring broker?
Monday, June 20th, 2011It makes sense to use a reputable and well established factoring broker. They will undoubtedly find you the best option which will be invaluable when it comes to choosing the right factoring and invoice discounting company for your business.
Unlike asset finance specialists where commission is added into the deal, the factoring broker is paid by the factoring or invoice discounting company from the income they would normally charge.
There are some important factors that need to be taken into account when choosing the right finance company. The biggest factor is to identify whether your business requires factoring or invoice discounting. Not all funders are equally specialised in factoring and invoice discounting. In fact some may just concentrate on one aspect of funding. The size and length your business has been trading needs also to be taken into consideration. High street banks are not always the most appropriate funder.
XL Business finance is one of the North of England’s premier independent finance companies with established links to many of the UK’s leading finance houses. Call us today, we are happy to discuss your specific situation.
Invoice Discounting Companies
Thursday, April 14th, 2011Invoice discounting can provide cash against up to 85 % of unpaid invoices however there are so many invoice discounting comapnioes to chooose from. How do you know whidch uis the right provider for your business.
We all know there are the high street banks providing invoice discounting facilities. There are providers that are owned by lessor known banks foreign banks which tend to havce their own atonomy. And then there are the independents that are not owned by the banks but are privately owned. Which funder is best for you depends upon your own particulkar circumstances and a good invoice discounting broker will certainly be able to add value in the process.