By Nick Sellars, Group Managing Director
Forget the media propaganda suggesting small and medium sized businesses (SMEs) cannot access the funding they need to finance their working capital. It may have been true a few years ago, but today it’s a fallacy. Whilst funding is abundant, you still need to know the best place to find it.
Historically, the first port of call was the local bank. As a former corporate banker, I would now have to say keep on walking. Unless the business is a certain size, very well established and very profitable in a stable industry sector, there is a fundamental lack of interest in supporting SMEs with the right level of funding that a business needs. Added to that will be a lack of technical and human resources to support the business to the right level, and you’ll be tied in knots by regulation and bureaucracy that you can grow old of waiting for an answer or decision. Now, I don’t like knocking banks because there is a lot they do well, but funding SMEs isn’t one of them.
So, where do you go? Well, there are challenger banks which tend to be better geared and knowledgeable of the sector, even so they’re not always interested in the sub £1 million lend. There is a plethora of unsecured lenders that offer deals and they’re good value if the amount required is modest (generally under £100k) and the business is squeaky clean. They are designed to be speedy and algorithm driven, but invariably there will be something that doesn’t quite fit the criteria and the manual override button sits somewhere in an empty room, and then the delays kick in. This may suit some, but if you want relationship and accountability you should move on.
“In my experience, SMEs prefer a proper relationship and like to talk through financial options, because business always moves on, constantly changes and never sleeps.”
The working capital needed to finance a business working is an ever-changing target, therefore you need a facility that moves with your business. So, where do you go? An independent invoice finance provider will give you options, service and flexibility at a decent price. Good credit control and credit management is often part of a full-service package with cash provided to boot.
“At 4Syte we provide a first-class service.”
We provide the hands-on human touch from first contact for as long as you remain on board. We use ‘tech’ to make the service simpler and more seamless, and plan to make this even easier. We are rapid in our responses and we aim to never waste your (or our) time.
We recognise that not all businesses are the same, so we have specialist divisions; one financing sub-contractors in the construction sector, another provides purchase finance to support imports or domestic purchases – thereby extending the working capital envelope.
If your business is not typically B2B biased, then our Structured Finance business offer structured business loans up to 10 years secured by a first or second charge against a suitable property.
So, you can see we are dedicated to financing SMEs, because that is what we do!
For a more detailed profile of our business and services, please have a look here or give us a call at 0845 652 0400.