SME – The risk of change

SME – The risk of change

April 20, 2017

Don’t be a brick, become a business-driven chameleon. As our businesses grow and develop we have to adapt and refine our goods and services in the face of change. Obstacles are all part of running a business but rather than seeing them as challenges instead address them as trials that weed out the weak from the strong. For your business to succeed and prosper into the future, preparation, foresight and a willingness to adapt to the risk of change is essential.

The risk of change  

Time flies and it most certainly does so in business. A business that was thriving yesterday may not necessarily have the same success tomorrow. The growth rate and sustainability of a business are dependent upon a number of factors, including new markets, products, regulation requirements, market share, business acquisitions, mergers, latest trends and so on.

There are so many variables it can be hard to keep track. Only by constantly keeping an eye on your chosen sector can you anticipate future obstacles to your business and brace yourself in advance. However, issues can strike you without warning and threaten the overall integrity of your business. In such situations quick reflexes in the face of change are essential.

Adapting to change

Preparation, foresight and access to external funding are vital for ensuring a swift and successful business adaptation. Obstacles to your business can come in any number of forms, including business debts, low revenue, advances in technology, business tax overhauls and so on. However, making changes to how your business performs can be costly, eating into your capital. You may need to redecorate your business, purchase new and improved equipment, fund an extensive marketing campaign and so on. In order to ease the burden, applying for external finance from the alternative finance industry is highly recommended. With Rangewell, you can source the most appropriate finance product for your business, including Business Loans, Leasing agreements, Merchant Cash Advance and much, much, more!

Business loans

When discussing business loans there two types that you must be aware of: Secured Loans and Unsecured Loans. In order to qualify, your business must be more than 2 years old, have a reliable revenue stream, a high or reasonable credit score and be able to set cash aside to better aid you when completing monthly repayments.

  • Secured Loans: With a secured loan your business could acquire a lump sum in the region of £5,000 to as much as £1,000,000. In order to secure the product assets, such as specialist equipment, premises and your personal home, may be used as security. Should your business fail to repay the loan on time, the lender can repossess these assets to cover their costs.
  • Unsecured Loans: With this type, you can apply for anything from £5,000 to a maximum of £250,000. However, this time you are not required to set aside personal business assets but because of this, lenders may well be more hesitant to offer large sums, making this product harder to acquire. Yet, should a lender to offer a lump sum it may not always be the exact sum that you require. In order to boost lender confidence, you could offer a Personal Guarantee.

Leasing Agreements

Leasing agreements allow your business to borrow equipment, typically, for a period lasting between from 1-3 years. When discussing leases you need to understand the two types available:

  • Operating Lease: With this agreement, you borrow the asset for a portion of the asset’s projected working life span. No responsibilities, such as maintenance, repairs, registration and so on, are transferred over to you at any point. At end of the term, you’re free to either extend the lease or hand back the asset. It’s unlikely that the lessor will extend an offer allowing you to purchase the asset in question.
  • Finance Lease:  Again, you’ll be required to commit to a monthly rental scheme. But this time the term can cover most of, if not the entire, lifespan of the asset concerned. You will also be required to accept certain responsibilities regarding maintenance, repairs, registration, administration and so on. Once the agreement has elapsed you are free to return, extend or purchase the asset from the lessor.

Merchant Cash Advance

With this option, your business could receive a lump sum within 48 hours of applying, based solely on your monthly credit and debit card sales. In order to qualify, your business must support card-based sales and be able to produce, on demand, 3 or more of your latest consecutive sales reports. Plus, what makes this such an appealing finance solution for many business owners is that there’s no need to produce your credit score as this isn’t taken into account. How this finance solution works is by a lender offering to purchase your expected takings for one month, otherwise know as ‘receivables’, at a discount. But what makes this product truly unique is the repayment scheme. Unlike the typical business loan, where you pay a fixed lump sum each month, Merchant Cash Advance takes a percentage of your potential monthly sales. For example, a lender could propose a percentage in the region of 18% for each of your card sales, which can also be described as 18p from every £1 your customers spend. Because of this, the repayment scheme is one of the most flexible in the finance market and means that if your sales go down during one particular month the amount you have to repay for that month is reduced, and vice versa.

Our values are simple – We’re on your side

At Rangewell our services are clear and transparent. We support a wide range of SME businesses of every shape and size, for finding every type of finance. Follow us on Twitter and LinkedIn for business tips and tricks, and feel free to call us on 0203 637 2340 if you’d like to chat about what we can do for you.


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David Harrison

David Harrison

Content writer