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Do you know if your clients are ready to apply for Business Finance?

Published on 10th September 2019 - Last update on 15th November 2019

Running a successful business isn’t easy, which is why having access to personalised advice is so crucial. As such, this is where you, as their accountant, can get involved. Whether they’re looking to ensure growth, maintain day-to-day operations or support any other key projects, your clients are entrusting you to help them move forward. That’s why you need to consider expanding your services and provide guidance on what business finance solutions are available. However, as well as identifying what products might be suitable, you also need to be aware about when business finance might be appropriate. To help you do that, here are 3 key signs you need to be aware of.

  1. What are your client’s goals?

In order to tell whether any of your clients could benefit from applying for business finance, you need to have a detailed discussion about what their short and long-term goals are. So if they’re looking for help growing their business, for example, you need to understand what exactly this involves. Do they require new equipment? Could they benefit from larger premises? Or do they require assistance preparing for a vital contract? Only by having an in-depth understanding of these goals will you and your client be able to draw up a detailed roadmap that’ll outline how the concerned goal(s) will be achieved. This will also work in your client's favour, should they choose to apply for Business Finance since many lenders will want to know how their funds will be spent before lending.

Are your client’s looking to raise funds to support growth and maintain day-to-day operation? Need help sourcing an appropriate agreement for their individual needs? Learn more about how your clients could benefit

  1. Do they have a reliable cash flow?

Another way of telling whether your clients could benefit from applying for business finance is by assessing the reliability of their cash flow. If their cash flow is stable it should indicate they’ve got a reliable customer base and are able to keep up with their operating costs. As such, this should give them a solid foundation on which to grow and scale their business, especially if they’re in profit.

However, if they’re experiencing a cashflow shortfall or are in the middle of an emergency that’s adversely affecting cashflow, applying for business finance could still be a viable option. This is because many of the business finance solutions on offer could allow your clients to raise additional capital on the back of their business’ past income, unpaid invoices, card-based sales (credit and debit card), intangible assets (trademarks, copyrights, patents, etc) or unencumbered assets (equipment, machinery, vehicles or property).

  1. Have they checked their credit score?

Finally, you and your client need to review both their personal and business credit profile. This can be achieved by requesting a report from one of the UK’s leading credit agencies: Equifax, Experian or TransUnion (formerly Callcredit). Together, you need to inspect the information that’s outlined, ensuring that it’s correct and whether there are any areas your client needs to address. When carrying out credit checks, you need to be aware that lenders will look at whether your client has past or recent CCJs, Accelerated Payment Notices, existing debt (e.g. credit card debt) and their history of resolving debt on time. However, although many business finance solutions do take your client’s credit rating in the account, there are plenty of other product available that may provide funds based on other factors, such as your client’s cashflow.

Therefore, business finance is available for a variety of financial situations. Yet, the key to success in this area depends on your ability to guide and source a suitable finance solution that’s appropriate for their individual circumstances.

Do your clients need help sourcing a suitable business finance solution?

Exploring the UK lending landscape can leave your clients feeling lost and confused. As well as considering what their bank may have to offer, the Alternative Finance industry is also helping to ensure more businesses than ever before have access to the funds they need to succeed. But with so many different products on offer, the challenge you and your clients need to overcome is sourcing the most appropriate agreement from a lender they can trust. Although this can seem like quite a task to fulfill, you don’t need to do it alone. Help is at hand.

At Rangewell, we’re an Access to Finance specialist and have mapped over 400 lenders to offer your clients an overview of more than 23,000 business finance products. Our services are free to use for you and your client and we’ll also guide them through the application process. So if your clients are looking to raise capital for their business, find out more how you can achieve the support your clients want from you with Rangewell.

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David Harrison

David Harrison

Content writer