Why do businesses borrow money?
What are the top 8 reasons for businesses approaching us for help with funding?
1. Investment in production
The best businesses deliver quality goods to their customers in good time with great aftercare service. That delivery can be put under real strain though if the amount of business you're doing exceeds your capacity to stay on top of it. You might be struggling to keep up with production because of growing demand levels and/or because the equipment you're using in production is showing its age.
Let us know the equipment you need to achieve both quality and quantity of output and we'll put together a funding plan which is not only tax-efficient but allows you to extract maximum value and profit from your investment.
2. Investment in staffing
If you're struggling to keep up with demand, the quality of your products & services and your after-care suffers. Not only that, it can put a tremendous amount of strain on your staff and, when demand is high, you need everybody working as hard for you as possible. Stress and overwork not only contributes to higher levels of absenteeism - it's also more likely your staff will walk.
However, investing in staff is a major pull on your cash. Not only might you be having to cover significant fees to recruitment agencies but your fixed costs will be much higher going forward because you're paying more people.
It can take up to 6 months to recruit all the staff you need for an expansion and to train them to do their jobs well enough so that they become productive and revenue-generating members of staff. Work out how much you need and call us with your requirements.
3. Break out of a lease
There are tens of thousands of commercial landlords in the UK who make a mint from ambiguous and onerous lease contracts they tie their tenants too. Not only that but there's an army of solicitors up and down the UK holding seminars for these tens of thousands of commercial landlords teaching them how to trap tenants indefinitely in expensive contracts.
Most tenants will wisely negotiate one or two "break clauses" into their commercial leases. What that means is that, although a lease might last ten years, the tenant is able to break out of the lease at the end of the third and the sixth year if they meet certain circumstances and conditions.
If this is you, work out what you need to raise with your solicitors and when you have the figure, approach us for the funds you need.
4. Working capital
There are plenty of reasons why, from time to time, a business does not have as much money as its directors want to have so they can run it comfortably. Sometimes, they may have invested in new staff and machinery but the increase in profit and productivity is taking a few months longer than expected to materialise. Other times, and often for no explicable reason, there is a three- to six-month slump in sales dragging down the cash in the bank.
Every business experiences times like these, no matter how great the company is and how experienced the leaders and senior management. Before you call us, figure out exactly what you need and why you need it and then approach our funding experts for advice and help with your application.
A new bathroom or kitchen for the office, new desks, new telephone system, updating computer hardware and software - there are always things you can spend money on to improve company productivity and the environment in which you and your staff work and greet customers.
As long as you, the director, can see and measure the commercial benefits from the investment, that's the important and deciding factor. Whatever you need for your existing office, warehouse, factory, or retail unit, let us know and work with us to find a way to fund it.
6. New website
With one in five consumer pounds now being spent on the internet and most searches for businesses being performed online, it's more important than ever to have a strong web presence and to invest in search engine optimisation services to make sure that you're found before your competitors.
In the early days of the internet, anyone in a bedroom could put together an internet site. Nowadays, the sheer level of competition on the internet and the need for a website to display well on all devices, particularly smartphones, has pushed the amount of money needed for a decent web presence a lot higher.
A website is arguably one of the best investments you can make in your business. If you have a quote from a favoured and trusted supplier and you want help to fund it, call us today.
7. Meet your VAT bill
VAT is one of the most fiddly and complex bills to work out for hundreds of thousands of businesses in the UK and, with the move to Making Tax Digital from April 2019, it's about to get even more intricate and complicated.
As you know, with VAT, you're meant to keep hold of all the VAT you've charged during a quarter and pay it all to HMRC in one go. Problems with payment can occur if you experience a slow trading period for the 4-5 weeks before VAT is due and this leaves many business owners with a major problem - how to pay?
Bearing in mind that the average VAT bill is approximately the size of 4-5 weeks pre-VAT turnover, it's a lot of money to find all at once. For help meeting your VAT bill, call us.
8. Meet your corporation tax bill
As with VAT, many businesses experience problems with paying corporation tax if there has been a drop in turnover in the weeks prior to the due date. This problem can be particularly acute if your payment date is near Christmas and you're a B2B company which essentially shuts down over the festive period.
Speak to our funding experts to find out how to spread the cost of your corporation tax over up to 18 months to take the pressure off your cash flow. For Quick Business Loan Apply for a loan here