SMEs struggling to find funding

SMEs struggling to find funding

Written by Adam Cooksley , Business Development Manager

Over the last few years the UK economy has experienced unprecedented times. From Brexit and Covid, to two prime ministers in 45 days, the knock-on effect has put pressure on SMEs across all industries. Costs for energy and freight have risen, currency rates have fluctuated, raw material costs have increased, and lead times on supplies have been extended or items have been discontinued altogether.

Consequently, three-fifths of small and medium businesses (SMEs) say that they require funding to ease their cash flow problems and more than two thirds need funding to grow. The UK has around 5.6 million SMEs. This means that about roughly 3.3 million will need financial assistance to stay afloat.

Whilst high street banks remain open for business, the process can be challenging due to these current economic issues. Another challenge SMEs face when looking to obtain funding from high-street banks, is their affordability requirements and sometimes lengthy application processes. As a result, business owners need to find alternative lenders to help them acquire the finance they desperately need.

In the event that your bank says no, you may be unsure where to turn. There is a plethora of funding solutions including?RLS, CBILS, RCF, ABL, Invoice Finance and Cashflow Loans?to name a few. When it comes to choosing a finance solution it’s hard to know which is the most appropriate. Furthermore, there are various lenders with different appetites for risk and different requirements, so navigating the market for that right facility is challenging.

The majority of business owners don’t have the time or expertise to research the right solution or lender. It is for this reason that commercial finance consultants like us exist. Our clients view us as their outsourced commercial finance team. We assist them in finding the right solution and funder for their business and project manage the process through to completion freeing them up to manage their business.

If you are willing to go alone and raise the finance yourself, please consider the following:

  • Making a hasty decision
  • Taking on too much debt that is unaffordable
  • Taking a loan that is insufficient to bridge the gap
  • Using out-of-date financials and forecasts
  • Take out the wrong type of finance for your business
  • Approaching the wrong lenders
  • Diluting the quality of your business and strategy by speaking with too many lenders, which could also result in numerous credit searches.

All these factors and more are considered when working with our clients. For example, we recently secured a seven figure?cashflow loan?for one of our clients to support their swelling order book. We achieved this in just three working days!

Despite a challenging trading period the business had a strong set of financial forecasts underpinned by confirmed orders seeing them well into mid 2023. We had to find a lender that could appreciate the challenges experienced and buy into the forecasts. As a result of our experience and lender relationships, we were able to find the right funding partner for our clients’ needs, first time around.

Now more than ever SMEs and business owners need support.?Navigate Commercial Finance?pride ourselves on our reputation and relationships. Without our reputation we wouldn’t have our relationships, and without our relationships we wouldn’t have our reputation!

We’re here to help you, whether it’s a discussion to see if we can help or even advice for solutions outside of our lane, do not hesitate to contact?Adam?on:

07852 505 607

[email protected]

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Paul Varley

Managing Director at Navigate Commercial Finance; Your outsourced commercial finance team. We source the most appropriate business finance for yours, your clients, working capital needs

2 年

It’s not getting any easier for #businesses with wave after wave of headwinds but there are also opportunities in volitile markets. As best you can, preserve cash, revisit your cashflow and for those business in pursuit of funding, some great tips from Adam Cooksley to help improve your chances of success.

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