A lot of attention has rightly been paid in recent months to businesses adversely affected by the Coronavirus pandemic. But there are a range of SMEs across the country that are growing exponentially.
Businesses in this situation that immediately spring to mind are couriers and haulage companies meeting the upsurge in online shopping, as well as cleaning contractors and PPE suppliers, but there are many others.
New vehicles and equipment are required to meet an increase in demand for their services. Yet in this ever-changing landscape, the necessity to conserve cashflow in a business continues to be key.
This is where asset finance is proving to be a very useful tool; through hire purchase and lease agreements, asset finance facilitates a business’ need to invest in the new equipment they need, without causing the significant dent in their cash reserves that an outright purchase would make. Instead, the equipment can be put to use straight away, but the payment is spread over manageable monthly instalments (with terms ranging from 12 months up to six years). Flexible deposit options and seasonal payment plans are available and there are tax efficiency benefits too.
There are many examples of this from the funding that Praetura Asset Finance has provided just this month.
One client is a courier delivery company that has seen their business levels rocket in the last six to eight months and needed more delivery vehicles to be able to meet the increase in demand for their services. We arranged a hire purchase facility for £55,472 over 48 months to allow the business to purchase five second-hand vans.
We also assisted a haulage company who, due to a contract with a large supermarket chain, have seen their turnover double since the onset of the pandemic, and need to grow their fleet to service this significant upturn. A finance lease was arranged for this company, to the value of £37,750 (over a 48-month term) to enable the acquisition of a three-year-old Volvo FH4 HGV.
As other industries have emerged from the first lockdown and work has recommenced on a range of projects, so has the requirements for new or upgraded equipment to be sourced. But where there are holes in their cashflow that need to be plugged (with many projects having been paused for months), an outright purchase is often not an option.
Another of Praetura’s recent clients is a plant hire company who are an approved HS2 sub-contractor. They have seen the demand for their services steadily increase over recent months, forcing a necessity for them to significantly increase the equipment inventory that they can have available to hire. Through hire purchase facilities, Praetura Asset Finance has provided funding in excess of £630,000 to allow the business to do just that.
There are new businesses starting out that need to be remembered as well. Asset finance funding from Praetura is helping these companies too. This month we have provided funding for a new-start construction company (totalling £284,480) which has enabled the purchase of two new pieces of equipment so that work on their first contracts can commence.
Whether your business is struggling or thriving, emerging or diversifying, asset finance could provide the answers to help your business progress.
As a consultant lender, the team of experts at Praetura Asset Finance are on-hand to advise and answer any questions you may have. Request a callback and one of our team will be in touch.
To find out more about the asset finance options available from Praetura Asset Finance, please visit praeturaaf.com/our-services.