Starting-up
Starting in business is always high risk. Start-up business owners are often so absorbed in establishing their new venture they forget to focus on their cash flow and the business can rapidly fail. However for many factoring is a great way to mitigate the risk involved.
Factoring can offer many benefits to start-up businesses; it avoids the sometimes awkward situation of asking your friends or family for money, using credit cards or worse, re-mortgaging your house. Factoring can generate cash to pay suppliers who rarely offer good credit terms to new customers.
Read this case study to find out how we helped another business like yours that was starting-up.
Deal Type: Start-up Industry: Wholesale & Distribution right of box
left of box bottom of box right of box
Deal type: Start-up.
Business sector: Drinks Beverage Industry.
Turnover: £2m.
This manufacturing and wholesale distribution company, based in the Scotland, currently produces white spirits for the drinks beverage industry. They manage the whole process – distillation, bottling, labelling and distribution. They already have a major UK buyer (national supermarket) and they also have contracts in in other countries, including South Africa and Australia
Plans to diversify their product range are underway with the building of a whisky distillery. The first whisky will be ready for consumption in 3 years – a 3 year wait for a revenue stream to kick in.
However, with the cash injected to start the new business used up, they now required the finances to continue manufacturing, promoting and most importantly, selling….
Our Solution
We pride ourselves on the relationships we build with our clients – trust and empathy are key to everything we do. That’s why we take the time to really understand a business before recommending a tailor-made solutions. In this instance we successfully sources a combined invoice finance facility which included a small element of export. Although the business initially wanted to keep control of collections (and use the chasing opportunities to secure new orders) we quickly established that there was an insufficient sales ledger infrastructure in place. By a lender taking control of the sales ledger it allowed the business to focus on the core business of marketing and sales.
Something else that makes us stand out from other Invoice Finance brokers is our flexibility. As businesses circumstances change, we adapt the solutions accordingly. Hence the facility here quickly developed to be combined invoice finance with significantly more export. Prompt collection bolstered the cashflow which enabled the business to instantly manufacture in response to demand. Exports could be funded too. Equally important the time freed up by us handling the sales ledger has enabled the business to focus on marketing and long-term business strategy.
The Future
With the funding made available to manufacture, market and distribute on the white spirits side of the business, the team can confidently concentrate on business growth, both through marketing and the building of the whisky distillery.
Key points
• Ability to fund the business growth in numerous markets
• Hands on approach to assist with the growth of the business
• Industry leading credit control function