What business items to use asset finance for

Asset finance allows companies of all types and sizes to spread the cost of the items they require to conduct their business and turn a profit. There are so many different businesses though, it can be confusing as to what actually counts as a business asset. Thankfully, it’s pretty simple as we explain below.

What Assets a Business Can Acquire Using Asset Finance

The assets themselves can be pretty much anything of value that the company uses to conduct their business. These can include large and expensive items such as vehicles like transit vans or forklift trucks. They can also include pallet racking, shelving and mezzanine flooring in a warehouse and all kinds of office and IT equipment.

Additionally, restaurants or other kinds of catering businesses may require special ovens or refrigerators to store food items, while an online retailer might require a set of computers and specialised packing equipment.

All of these items are types of business assets which can be acquired through asset finance. The asset finance options available might differ according to the asset’s depreciation value, but there will be various options for most business assets.

Refinancing with Secured Assets

One asset financing option that many businesses opt for is refinancing, where assets such as those mentioned above which are already owned by the business are used to secure asset finance. One example would be that of a haulage firm securing a refinancing deal against its fleet of vehicles. The refinance could then be used to expand the business.

Such an option provides access to capital that otherwise isn’t available for many companies.

Using Asset Finance to Acquire Assets

There are several options open to different types of business, enabling them to acquire the assets they need to turn a profit. Hire Purchase and Lease Finance are popular choices which allow a business to spread out payments over time. Once the payments are complete, the business will own the asset outright or will often be able to aquire via Prolease.

If you would like to learn more about how your company could use asset finance to acquire important business assets, contact Prolease Finance and our friendly personal team who can help you decide which option is better for your business.

 

Demand for asset finance is on the rise as investment for growth remains a leading priority for businesses

Investing in your business for growth using  asset finance makes it a much easier to achieve your ambitions. A lot of companies are using asset finance as the means to purchase a variety of essential business assets which in turn helps to preserve working capital as well as enable the business to expand.

Conventional Loans on the Decrease

Just five years ago, a study by Asset Based Finance Association (ABFA) revealed that conventional loan activity among smaller UK based businesses had declined significantly compared to the increase in businesses using asset finance instead. The increase in asset finance usage is a trend that has continued to this year and doesn’t look like changing any time soon. This is in part due to the difficulty smaller businesses face when trying to acquire bank loans and unsecured finance.

Small businesses are usually the type of firms that require financing due to capital shortages, which is why asset finance providers such as Prolease have been able to help so many small and expanding businesses.

Asset Finance Helping Small Businesses to Grow

The other significant element of the decline in conventional financing is the improvement in the asset finance options available to all kinds of businesses. There are now a wide variety of options available through asset finance specialists like Prolease Finance, through whom businesses of all types and sizes can find the funding they need to acquire their crucial business assets.

Asset finance is growing so popular simply because it enables smaller businesses to invest their funds directly into their own operations without depleting their company’s capital or acquiring significant debts.

It is even good news for the lenders, as asset finance allows them to provide loans with a much lower risk of default. With the variety of options available, such as hire purchase and lease finance (to name but two), both businesses and lenders are able to help each other keep expanding their operations and increase profits, which is what business is ultimately all about.

If you would like to learn more about how your company could use asset finance to acquire important business assets, contact Prolease Finance and our friendly personal team who can help you decide which option is better for your business.

 

How Prolease can provide you with the finance you need

Owning and operating a garage is one of those businesses that will always require significant running costs due to the specialist equipment that is required. Every piece of machinery is an investment, and many of those investments are absolutely necessary in order to run the garage in the first place.

So how can a garage owner ensure they always have enough working equipment to keep the business operational? The key is asset finance.

The garage equipment finance package offered by Prolease is specifically tailored to the garage business, with the payment options available allowing garage owners to upgrade or acquire new equipment as and when necessary to meet customer demand and continue growing the business.

How to Ease the Financial Burden

By acquiring new equipment using a Lease Finance contract, you can pay for the necessary investment gradually in smaller and much more manageable chunks. Spreading the cost out over a period of time allows the business to keep on top of the game, perhaps even expand, without taking the blow of a massive cash expenditure all in one go.

Once installed and operational, the new equipment will begin generating increased profits which will ultimately pay for the new machinery itself. Consider the increase in profits that an extra MOT lane will bring in, or the increase in performance that a new handheld diagnostic tool will produce. The increase in revenue should more than cover the payments for the new equipment, meaning the business can continue expanding without any extra significantly noticeable outgoings (aside from the usual operational costs of running the business).

Prolease Provide Investment Opportunities

Due to the large number of sole traders and partnerships in this sector, garage equipment finance deals are usually of the Lease Finance variety. This means that the garage equipment finance deals offered by asset finance specialists Prolease will be secured on the asset itself.

Prolease also operates in conjunction with a variety of different leasing sources and banks, which makes multiple lines of credit available to your business. Another benefit of this is that the asset finance deals your garage business can make with Prolease will not affect any of your other banking facilities such as overdrafts or loans, which is especially important if you use these for working capital.

Additional Benefits of Garage Equipment Finance

By taking advantage of the extensive leasing and funding sources made available by Prolease, your garage can acquire many different types of equipment whenever necessary. Whether your business is just starting out or you are looking to expand or meet a spike in demand, there are finance deals which can help you.

At the very least, upgrading to the latest technology will enable your business to remain on terms with competitors, if not steal a march on them. The fixed payments attributed to lease agreements will also remain unaffected by any changes in interest rates, which is not the case with standard bank loans. There are also certain tax advantages to be gained by using asset finance.

If you would like to learn more about the benefits of garage equipment finance, contact Prolease Finance and discuss your business needs with our friendly and personal team of asset finance experts.

 

Realising the needs of your business and financial requirements is key to asset finance

If your business requires special machinery then decisions will have to made regarding how to finance such expensive outgoings. One of the main options which makes such large purchases easier to manage is asset finance. Knowing exactly what you want to achieve from the transaction is the key to getting the best out of any asset finance deal.

There are multiple options which will suit a variety of circumstances, so identifying the ideal choice for your business is obviously the first step to take.

Long Term Leases and Eventual Ownership

If your business is seeking to use asset finance to enter a long-term agreement, then a Finance Lease will be ideal as this enables you to rent the asset over a long period of time.

Finance Leases are popular because they come with certain tax and cashflow benefits, such as requiring the VAT to be paid on the rental payments rather than the purchase price.

If such a deal sounds appealing, but you would like to explore the possibility of eventually owning the asset, then you can agree to a Hire/Lease Purchase instead which will enable you to keep the asset at the end of the agreed term. This is an excellent purchasing option as it breaks the cost down into much more manageable chunks and spreads them out over time. The flexible repayment options also mean you can structure the payments around your company’s cash flow.

A similar option is the Contract Purchase, which is similar to the Hire/Lease Purchase but includes the option to choose not to own the asset at the end of the agreement (potentially ideal for assets that massively depreciate in value).

Finally, the Sale and Leaseback option provides your business with the ability to access cash that would otherwise be tied up in the purchase of an asset.

If you would like to learn more about asset finance, contact Prolease Finance and our friendly personal team can help you decide which option is better for your business.

Caplor Energy

 

 

Caplor Energy is our most recent IAR (Introducer Appointed Representative – see earlier news items)

Caplor Energy are local to us in Herefordshire and have been industry leaders in the renewable sector.

Many of our customers are now wanting a greener image and are conscious of their carbon footprint.

Feed In Tariff and Renewable Heat Incentive have long been a business driver in this market place but as the incentives have reduced then business viability is more relevant than ever.

For your energy requirements please contact www.caplor.co.uk and speak to:

Mel Preedy Tel 01432 860644 and email mel.p@caplor.co.uk

Caplor latest news letter Click here for Caplor News

What you need to legally introduce finance to customers

FCA

Equipment suppliers are able to register directly with the FCA for limited permission or full permission credit activity. This can take up to 12 months, costs £300 and involves regular reporting of credit activity to the FCA via their online reporting system. FCA website

If you don’t want this hassle you can apply to become our Introducer Appointed Representative (IAR). This then allows you to promote finance, introduce customers to us and advertise finance (with our compliance advisers approval). There is no cost to you just a simple form to complete and to sign a contract with us.

Prolease do all the work for you and as a “principal” firm we are responsible for your consumer credit activity and reporting on your behalf to the FCA.

If you want to know more please email info@marine-finance.org or call on 01432 347770

Here are a few of our most recent IAR’s

Refinance PV (Solar) roof panel – nothing too extra ordinary

PV panels

An existing customer for whom we have financed several deals has recently won major contracts to  manufacture a unique product which will potentially change a whole industry.

The process requires the customer to relocate their business and a major investment in the near future. Asset finance is sure to play a part in the expansion but the business needed cash right now.

We were asked if we could refinance a 3 year old solar panel installation, which had a FIT contract for the next 15 years. Our regular lenders all said no immediately due to the asset and the proposal not fitting the “norm”. After speaking to several lenders we identified the ideal partner and completed a sale and lease back within 48 hours.

We look forward to assisting the business achieve its future expansion later this year.

Biomass System and Stage Payments

BiomassIn December we received an introduction to an agricultural business that has diversified into recycling green waste. Within the green waste is a considerable amount of waste wood which once dry can be chipped and sold on as a “green” renewable fuel.

Our customer had already obtained planning permission to install two biomass systems to generate heat to dry the recycled wood and receive RHI payments for the next 20 years. A lucrative investment.

The whole scheme needs to be up and running by March 31 2017 and it was crucial that a stage payment was made to the supplier before Christmas.

We made it with the first payment being made on 23 Dec 2016 so ensuring the completion date remains on schedule. We have just paid out the second stage payment and completion is due for the end of March.

Prolease were able to be responsive and innovative by financing construction work, buildings, power supply and a biomass system. Our stage payment facility has enabled the project to remain on schedule whilst preserving our customer’s cash flow.

 

Refinance deals – how best to do it and save money

We do not often refinance equipment but our lenders are telling us they get asked to do this frequently.

In September we  completed 2 refinance deals – the first one was for an existing customer KDW Ltd and was to refinance a 2006 DAF commercial and a 1993 metal press pictured below.

 

t60rev picture

Both of these equipment items were refinanced over 3 years using hire purchase – so ownership and annual investment allowances remain with the customer.

This is a major benefit for the customer.

If you are thinking about raising cash by refinancing equipment then it really is a benefit if you do this within 3 months of purchasing the equipment. This gets you a lower rate, whilst avoiding time consuming and possibly costly valuations.

What do we need to provide sale and hire purchase back finance?

A copy of the original invoice, evidence of payment to the supplier by you – so a bank statement or a receipted invoice, an invoice from you selling the equipment to the finance company and a signed finance agreement.

The above deals were completed using our e docs which meant funds were released almost immediately paperwork was raised.

Contact us if you would like to know how we can help you release cash from equipment you have paid for.

 

Prolease App

Here is our new app – copy and paste into your web browser and save to your phone, pc or tablet                  Prolease app

 

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