Author: admin (page 10 of 18)

Dangers Exist On the Horizon For Many UK SMEs

10th July 2017 / admin / Comments Off

Unstable government, rising inflation and skills shortages are just some of the challenges facing SMEs this summer and beyond as the economic climate begins to look more than a little unstable of late.

Even so most SME owners seem to be decidedly buoyant about their prospects with and optimistic 54% thinking there will be no impact on their business from Brexit. One in five of those who expect and impact meanwhile have a plan in place to combat any future effects. At least these were the findings in a survey recently conducted by AIB of 1,327 SMEs.

This optimism clearly goes with the territory for ambitious business owners who are on the whole positive thinkers. The hope is that things will turn out ok for everyone and we can all carry on as before but it doesn’t hurt to plan for any eventualities as you would do for any business.

Asset finance is an ideal way to raise funds for your business and even better when things are going well. Business owners often turn to asset finance as a last resort when they are rejected by banks or other lenders when the opposite should be the case.

Strong Growth For Asset Finance in Q1 2017

10th June 2017 / admin / Comments Off

Economic forecasts may have been gloomy in the first quarter of this year but the Asset finance market appears to be bucking the trend with promising results for asset finance new business in Q1 2017.

According to the latest data released by the Finance & Leasing Association (FLA) new business in the sector increased by 9% overall in the first quarter of the year compared to the same period last year.

The results show that more and more businesses are continuing to opt for asset finance over other sources of finance to invest in new equipment and machinery.

Results from the agricultural and construction sectors were even more encouraging with the former seeing growth of 43% and the latter seeing 23% compared to the same period a year ago.

While new business growth for asset finance in business equipment was less impressive at 2% it still indicates that growth is strong overall and asset finance growth is not just confined to the agriculture and construction industries.

Economists say this quarter’s strong results matched improved expectations for business investment in the Bank of England’s May inflation report.

If you would like to find out how asset finance can help your business contact us today.

Clarity Needed On Diesel Cars…

11th May 2017 / admin / Comments Off

…To Prevent Uncertainty Over Asset Values

Diesel cars have enjoyed a long period of high residual values but this appears to be coming to an end as the government toys with the idea of how to reduce levels of harmful pollutants.

This has led to calls for clarity in areas such as a potential scrappage scheme for older diesel cars and possible restrictions on where diesel cars are allowed to go in city centres.

The future of diesel is currently under threat not only from the rise of electric cars which enjoy considerable tax benefits but even petrol engine cars. The latter once demonised as the primary polluters of the atmosphere and for comparative inefficiency have evolved to become much more economical than in the past. Pollution from petrol cars has also been found to produce less of the particularly harmful substances found in diesel emissions.

All of this of course will affect the value of older diesel cars and possibly a knock-on effect on newer models. The emissions scandal that has recently rocked Volkswagen and continues to rumble on will have done little to inspire confidence.

Continued speculation over which cars a potential scrappage scheme will apply to and when to will also cause uncertainty in the used car market as people start to wonder how much their cars are actually worth.

Is Asset Finance An Option For Startups?

11th April 2017 / admin / Comments Off

Asset finance is often seen as something a more mature business might consider when they are looking to grow and expand, however it can be just as useful for a startup needing that extra boost to get things off the ground.

Another reason asset finance can be good for a startup is the relative ease with which it can be sourced compared to raising money from other sources. Raising money from the bank for an unproven startup can be a difficult task yet there is still that need to establish a solid financial platform to enable the business to survive.

Asset finance is available in many forms including leasing hire purchase, refinance and specialist funding. What all these different forms of asset finance have in common is they protect your cashflow.

Lack of cashflow coupled with unmanageable debt is a recipe for disaster in a business and if you have a business that may rely on one or two big clients, then you may be vulnerable if one or both decides to pull the plug.

Asset finance will at least enable you to spread the cost of borrowing over a longer period to protect your cashflow and continue to grow your business.

Why SMEs Need Asset Finance More Than Ever In 2017

6th March 2017 / admin / Comments Off

If anyone had a crystal ball back in June 2016, it is unlikely they would have been expecting to see strong UK economic growth by the end of the year.

Fortunately despite a steep drop in the value of GBP and its continuing weakness, the UK economy has been surprisingly robust, confounding the expectations of analysts.

While this is welcome news for most of us, strong economic growth can be something of a double edged sword for SMEs. On the one hand there is the potential to grow the business and take advantage of the positive economic environment.

On the other there is the need to maintain the balance of cashflow and investment in the business. The cost of a sudden increase in new orders can put pressure on cashflow unless business owners can ease this problem with finance.

A range of finance options will be on the table for companies that find themselves in this position but one of the more sensible options is asset finance.

Asset finance can help business owners grow their businesses with fixed periodic payments rather commit upfront cash or apply for an overdraft from the bank.

Why You Should Never Be Too Busy For A Business Plan?

14th February 2017 / admin / Comments Off

If there is one thing that sets apart businesses that succeed from those that fail, it’s a business plan, which is why it’s surprising to find that even some medium sized businesses don’t seem to have one.

Even Donald Trump has a plan even if at times it seems that he doesn’t and it is often when we look back on progress that we see how important those plans were in achieving things.

Without going into the old fail to plan, plan to fail mantra a business plan should include goals that everyone within an organisation is will work towards. It will also include steps on how to achieve those goals based on a realistic assessment of what can be achieved with available resources.

Running a company as any business owner will tell you takes a significant amount of time and effort and planning ahead is often seen as a luxury that is sacrificed to short term needs such as production and chasing payments.

A business can soon get stuck in a rut without planning to the point where it stops growing and things simply chug along. This can be a dangerous time. All businesses need a steady flow of new customers to be healthy.

Acquiring those customers can be difficult of course but a plan will allow you to make an accurate assessment of the resources you need to get them. It might also bring you to the question of finance or how existing assets can be used to finance expansion.

5 Steps To Producing An Accurate Forecast For Your Business

13th January 2017 / admin / Comments Off

Regardless of how large or small your business is, accurate forecasting for the year ahead is critical to maintaining healthy cash flow. Reduced cash flow is the most common reason for business failure, so being realistic about the sales you expect to make and the profit that will be generated from these sales is vital.

Here are our top tips on producing an accurate forecast.

Be realistic
Many business owners find themselves living in a fantasy world when it comes to forecasting. They only consider the best case scenario when investing in new ventures for example and fail to consider what happens if that venture fails to make a profit. Business costs can certainly rocket and there is often no guarantee that doubling advertising spend will lead to a doubling of sales.

Consider possible economic impacts
This year we are more likely to see inflation rise due to the falling value of the pound against other major currencies as well as the start of Britain’s exit from the EU. Ensure that your business is prepared for any shocks that might come in the next 12 months.

Consider seasonal demand fluctuations
If for example you own a retail business that sells winter sports equipment, then your busiest times of the year are unlikely to be the summer months. Take into account seasonal demand with your seasonal forecasting if your business relies on it.

Make sure you differentiate between the income your make and your costs
Not every business gets paid monthly, sometimes payment terms may be up to 90 days which means a long wait for money. The opposite may be true if you purchase equipment for your business on credit and the bill doesn’t arrive until the following month, putting your business under possible financial pressure.

Consider asset finance for your business
Asset finance can help you boost cash flow at vital times and ensure your forecasting remains positive for the year ahead.

Business Lending To Manufacturers Falls

9th December 2016 / admin / Comments Off

Despite the current low levels of interest rates on loans, lending to manufacturers slowed in the year to October 2016, declining by 5.2% according to the latest statistics released by the Bank of England.

Does this signal the start of a more cautious approach to lending amongst manufacturing businesses post Brexit? It’s too early to say but uncertainty doesn’t appear to be having any impact on consumer borrowing, which increased by 10% in the same period.

Although manufacturing only accounts for a tenth of the UK economy today, the divergence in lending figures suggests that consumers are happy to keep on borrowing in advance of expected price hikes in 2017 when the fall in the value of GBP against the dollar and other currencies starts to bite.

Despite making up a smaller part of the UK economy than it once did, the manufacturing sector may be in a for a tough time due to its reliance on foreign imports. This could be exacerbated further if the government pursues a so-called hard Brexit, which could result in tariffs when trading with EU nations.

Manufacturing wasn’t the only sector to see a decline with total business lending also falling by £8.2 billion month on month. This fall was largely due to a decline in loans to the financial services sector.

How Asset Finance Can Stop Your Business Falling Behind

7th November 2016 / admin / Comments Off

If you want to win in business the most important thing to do is stay in the race.

You hear this all the time from football managers who are under pressure to bring home league titles. Winning is always a case of staying in the race whether that is in the lead or at least keeping in touch with the leaders.

This is sometimes hard to achieve for smaller businesses that lack sufficient cash to purchase the latest equipment they need to compete on a level playing field. The harsh reality is that businesses that have the resources will simply mop up all the available clients if they are able to provide a faster and more efficient service.

The key thing from a business point of view then is to continuously invest in new equipment. However rather than commit lots of cash up front and put your business operations at risk, asset finance is a way to fund the growth of your business without digging deep into your working capital.

Asset finance can be a flexible and reliable way to help you achieve your business objectives without making a huge sacrifice. If you would like to talk over your options with us we will be more than happy to help advise on how asset finance can work for your business.

What is the Annual Investment Allowance?

11th October 2016 / admin / Comments Off

Our clients often ask us what Annual Investment Allowance (AIA) is and why it’s important when we first have a discussion about asset finance. Here’s a brief guide to what it is and how it can help.

AIA is actually a type of tax allowance to encourage businesses of all sizes to invest in new or used plant and machinery to help them grow. The 100% allowance applies to expenditure up to £200,000 during the year of purchase.

This acts as a great incentive for business owners who may be considering investing in say new machinery to improve productivity. However, there are exceptions that are not included in the allowance including land buildings and cars.

If you are keen to grow your business we can advise you on all sorts of ways to use asset finance to achieve your growth ambitions. We can also advise on the likely tax implications and perhaps reveal some allowances you may not have been previously aware of.

Every business situation is unique and the process depends on whether you intend to buy or lease and the amount of finance you need. Asset finance can be used to acquire a new fleet of vehicles or upgrade your IT systems. Whatever your requirements, our advisors will be happy to talk to you.

Asset Finance News You Might Have Missed Over The Holidays

12th September 2016 / admin / Comments Off

August is a usually one of the quitter months in the business calendar, however this year there have been a few things happening in the UK asset finance industry you may not be aware of.

Far from taking it easy over the holidays industry regulators have been busy finalising reports and consultations which will have implications for the asset finance industry.

One important announcement came from the Bank of England which announced that it would introduce a new scheme to replace Funding for Lending. The new scheme called Term Funding Scheme will involve lending money to banks on the understanding that banks will continue to up their lending to businesses and households.

Post-Brexit, the economy needs all the help it can get to try and stave off a slide into recession as uncertainty over the UK’s trade relationship with Europe continues. While the fuss over Brexit seemed to have died down a little in August as everyone waits to see what the outcome will be, this may well be the calm before a storm that is likely to be felt in all areas of the economy.

One other piece of news was a HMRC proposal to scrap certain salary sacrifice tax benefits which includes the possibility that car salary sacrifice benefits may be withdrawn.

Benefits gained from pension saving, childcare and the Cycle to Work scheme will remain eligible under the new proposals.

What Type Of Asset Finance Is Right For Your Business?

11th August 2016 / admin / Comments Off

Asset finance is an umbrella term that covers a variety of options for businesses that need to protect cash flow or find ways to buy new equipment and machinery without the high initial costs. So what are the options for businesses and which one is most likely to suit you?

HP or lease purchase
If your aim is to buy equipment for your business and eventually own it outright, then HP or lease purchase is a good option. You will be able to pay off the cost either in lump sums or structure repayments to suit your cash flow.

Finance lease
If ownership of equipment or machinery is less of a concern then finance leasing gives you the option to rent it for an agreed period. With this option you can offset your rental payments against your tax liability and less of your money will be committed up front protecting your vital cash flow.

Sale and leaseback
This option allows you to release money tied up in assets. This cash can then be put back into the business.

Operating lease
You may require specialist equipment only for a short period to satisfy the needs of a short term contract for example. In this case an operating lease offers flexibility and you can rent equipment for the period where your business needs it.

Contract hire
This is one way to avoid the costs of owning depreciating assets.

Contract purchase
This works in a similar way to hire purchase but you won’t be required to take the option of ownership at the end of the agreement.

Brexit Increases the Importance of Asset Finance to Businesses

11th July 2016 / admin / Comments Off

The asset based finance industry has been growing at an impressive rate in recent years and Brexit will do little to put the brakes on that growth as uncertainty about the economy weighs heavy on business owners’ minds.

It is now more important than ever that businesses plan finances in preparation for an uncertain future. It is also understandable that many will be cutting back on investment in new staff and acquisitions until the impact of Brexit on the economy becomes a bit more clear.

The immediate impact of Brexit on businesses is for now confined to sentiment. This sentiment may well snowball into a new recession that affects everyone. If one business reduces its investment, then it is inevitable that suppliers will be affected.

For cautious business owners, now may be a good time to look at asset based finance which can help fund new equipment purchases when liquidity needs to be preserved.

The costs for businesses that buy raw materials outside the UK will find that their margins will become more and more squeezed with each drop in the value of sterling. While the pound’s fall in value will benefit exports, it will also push up inflation. Let’s keep our fingers crossed that it will all turn out okay in the end!

How To Boost Your Startup With Asset Finance

6th June 2016 / admin / Comments Off

Owning a startup can become a rollercoaster ride of success and adversity you must overcome to be one of the small percentage of new businesses that make it to their 5th year of trading.

One of the biggest challenges for a startup is having enough cash to continue operating as a business. Often there will be issues with dwindling cash reserves, poor cashflow or both.

Having one or both of these problems together can cut off the life support of any business, so it is crucial to try and establish a solid financial base from the outset so that you can survive any storms that come your way.

Unfortunately it isn’t always that simple. Startups often have the cost of new machinery, equipment or even software eating into business profits. Asset finance solves this problem by turning those assets into cash so that the business can continue trading and costs can be spread over a longer period of time. This provides vital breathing space or more time to become established.

To see how asset finance can help your business contact us today.

Vets Equipment Finance

5th May 2016 / admin / Comments Off

If you run a veterinary practice today, you will need all kinds of equipment to ensure that things run smoothly and efficiently in addition to ensuring the best standards of care.

Of course all the equipment you need these days doesn’t come cheap, which is why finding ways to finance your assets can be helpful if not essential. The great thing about asset finance for vets is, you can use it not only for large expensive items of machinery such as x-ray processors but also smaller items such as thermometers and other equipment you might use every day.

Breaking it down in simple terms, there are two main asset finance options for vets. These are leasing and hire purchase.

If you want to keep costs down, leasing can often be the better option and even more so if your needs are short term. Your monthly costs will be less because you aren’t buying your equipment and at the end of the agreement you can simply return it or renew the lease. Your approval rate on leasing will also be higher than for higher purchase.

With higher purchase on the other hand you will eventually own an asset permanently although you will need a higher deposit and the monthly payments are likely to be more. Again approval rates are high for asset finance lending on equipment bought on higher purchase as long as your credit rating is good.