Category: Richmond Asset Finance (page 9 of 9)

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.

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.