A second loan for a travel agent
When additional funding can prove crucial
Travel has struggled in recent months, but funding shouldn't cause additional problems.
People are currently unable to freely travel abroad on holiday and, as a result, some of the big holiday companies have gone to the wall - and many travel agents look to be in danger of following them.
Most travel agents are now online operations, which means they have no problem continuing trading, with many set up with their sales agents working from home, dealing with calls and using the systems remotely. It could be business as usual - if there was any business to do.
We were recently approached by the owner of an independent travel agent business who has a £13million turnover in a good year - but who had found that 2020 was nothing short of a disaster.
“Because most of the business is online these days we could still trade. But it soon became obvious that people were just not going abroad this year. A few were still travelling on business, and people who had family overseas might still need to go - but the bread and butter of our business had vanished.”
There was still some business coming in from loyal customers; the owner had built up a reputation with expats heading back to see family, but the business was suffering. With rent and other overheads, profits were small at around 10% of turnover and there was little cash in the bank to ride out the downturn.
But the owner saw that there could be hope for her travel business - if she could take advantage of funding to provide the cash to stay afloat.
However, there was a problem. Lenders will therefore lend under their own lending criteria. When the business owner approached his bank for help she found they would not provide additional funds because they had already done so.
The business had already applied for CBILS funding on £250,000 back in March, which they believed would be enough to carry the company through several months of lockdown.
The loan had been provided, but with lockdown continuing for many months after the initial projected period and the travel industry in chaos, the bank was wary of making a second loan on the basis that the travel industry as a whole was not achieving the recovery expected.
The bank had looked at its loan book on a sector by sector basis, and had taken the decision to refuse any further lending to businesses in it.
The business owner was left with a steadily shrinking reserve of cash, and debts that just could not be avoided.
How Rangewell found a solution
The owner approached us at Rangewell, and asked for help. We were able to support the business owner in getting the additional funding she so desperately needed.
£250,000 at 8.5%, with 12 months initial repayment freeze
The client had the funding she needed - with nothing to pay back for 12 months.
“I had been worried that I would have to close down altogether when the Covid crisis kept on. Without the holiday trade, we simply were not in a position to make money. Rangewell explained that they had contacts who could provide the kind of funding we needed now to deal with the way the epidemic was developing - I was only sorry that I hadn’t gone to Rangewell sooner.”
Rangewell finds the financial solutions that your business needs
The Rangewell service is easy to use - and lets you talk to a funding expert to get a solution that is planned around your business needs.Just call us and one of our Business Funding Experts will be able to discuss the options, and work out the most cost-effective ways to provide the funding you want - whatever the challenge your business plans present.
We can help you see what type of loan might provide the answers you need - or whether there is another form of funding which could provide a better answer for your particular circumstances.
It can be the simplest way to find the lifeline you need for your business.
Keeping your travel business going places with help from Rangewell
Individual arrangements tailored to your circumstances
Adverse Credit – no problem
Repayments geared to your turnover
Expertise in funding for your sector
Talk to Rangewell – the business finance experts