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£150,000 fit-out funding for a nursery: cutting the cost of growth
If your clients include childrens nursery operators, you will know the financial challenges they face. Owners face restrictions on what they can charge per child, and overheads are high. You may advise a small nursery to grow its numbers as the best route for profitability - but space requirements are specified by the regulations. What’s more, many parents - and children, and probably staff - may prefer a smaller facility with a friendly atmosphere. They will actively seek out a small nursery, and even be prepared to pay more for a place where there are not too many children competing for attention. We recently helped an accountant find a solution for a nursery operator who had no choice but to grow her business. “We didn’t have any more room - even though we had built a great reputation and had plenty of parents knocking on our door.” The challenge The accountant's client ran a nursery serving a commuter town and had premises close to the railway station - an ideal position for parents dropping off their children before heading off to work. However, when a major development plan was proposed, it was clear that the nursery would need new premises - and need them fast. Ready to find out more about finance for your clients' growth plans? Our experts can find the most appropriate solutions and the most competitive rates Fortunately, the developers were sympathetic, and were able to offer alternative premises nearby. “The offer was a good one financially, and we saw that the new premises would allow my client to offer more places and to grow her business - but the unit was a bare shell, and would need a complete fit out before it could be used as a nursery.” The unit would offer a more spacious environment with more opportunity for active play. It might be possible to provide 60 or 70 places - but the costs involved were daunting. “My client looked at the costs involved, and realised that she would need to spend around £150,000 to fit out the interior to meet all the regulatory requirements. She came back to us to help her find the most cost-effective way to provide the funding. We contacted Rangewell on her behalf.” At Rangewell, we can help provide any kind of business funding - and the first step in our process is to find the most appropriate source of funding for a particular need. In many cases, business equipment can be provided by Asset Funding. The items acquired act as security for the loan, which means that rates as low as 4% can be offered - because the lender can simply repossess the equipment if the business defaults on payments. However, when fitting out much of the cost will be for the work involved with decorating and construction, and for ‘soft’ assets such as carpet. These have no potential resale value which means that they cannot be covered by conventional Asset Funding. It may be necessary to arrange a business loan to cover the work - which can often be more expensive. “Our client received quotes from a leading lender which would mean paying 11% interest on a loan over five years - which would mean repayments that we felt would simply not be affordable from our client's limited cashflow. We hoped Rangewell could do better.” The solution We saw tha,t by splitting the funding into two parts, we could cut costs. We developed a loan package which would provide Asset Funding for all the equipment - seating, lighting and heating systems - and cover the rest with a Secured Loan. We approached a number of high street banks. By approaching those we knew were sympathetic to the sector, we were able to get a loan secured on the owners home for the balance required at just 6% and to spread it over ten years. Her accountant believed that the repayments would be affordable. At Rangewell, we work with over 350 lenders to offer you an overview of more than 23,000 business finance products. We work closely with accountants to help find the most appropriate - and affordable - funding solutions for their clients. Simply call us on 020 3637 4150 - or email [email protected] Our service is free.
What will Brexit mean for Customs and VAT?
The latest proposals are on the table – but none of us really yet knows what is going to happen at the end of the month. There could be a third Brexit delay, or a Withdrawal Agreement with a transition period agreed by then. But if on the 31st the UK is going to fall out of the European Union without a deal or transition period, it could mean some headaches for you and your clients – whether or not they do business internationally. Some of the most painful headaches of all will be those that are caused by leaving the Customs and VAT regimes under Brexit. International business has become the norm over the last 25 years and global supply chains have emerged. However, no one under the age of 45 has any experience of working outside the Single Market and Customs Union, and those who can remember the paper-based procedures pre-1993 will be in no hurry to see a return to them. It looks as though Brexit may be something of a leap into the dark for your clients. To combat the confusion, the Government has begun to put out Guidance Notes on a wide variety of subjects and – at long last - has prepared a site which aims to clarify the position. As they make it clear, if we are going to have a hard Brexit, a whole raft of new trading and indirect tax rules will be applied. This will include tariff duties, customs declarations and import VAT on goods crossing UK and EU borders. Note: The new rules will be applied at 11pm on the 31 October, rather than midnight. What will this mean for both you and your clients? There will, undoubtedly, be a panic to get goods in or out of the country before the deadline, and ferry ports can anticipate some angry scenes as drivers race to beat the clock. As the dust settles, there will be a wide rage of issues to think about, covering every aspect of customer and supplier contracts. Your clients will need help through a maze that could be thorny with fines as well as tariffs – but the most pressing problems will probably be customs, duty and VAT. Customs After years of unhindered access to Europe, the reimposition of customs will come as something of a shock - and a major extra cost. HMRC has told parliament that 400 million new Customs Declarations will potentially need to be filed, at an estimated cost of £32.50 per declaration. And this is, of course, before the duty itself is paid. UK importers will need an Economic Operators Registration Identification (EORI) number for clearance of goods into UK ports. The EORI number is an EU-wide identification number that is recognised within all 28 EU Member States and must be recorded on all customs declarations. It is not possible for businesses to move goods into or out of the EU without an EORI number - so once the UK is outside, EORI numbers will become essential. HMRC is auto-enrolling UK companies but if you have EU-based businesses importing into the UK you may need to apply to HMRC on their behalf. UK businesses doing business with Northern Ireland or Ireland will not require an EORI. Apply for UK and EU EORI numbers here. Will your clients need financial support through Brexit? Become a partner, or contact us for more information Duty Customs duties and import VAT will become due at UK or EU borders. Calculating the duty on imports will require commodity codes for all goods, as the first step to calculating UK duty. HMRC have a trade tariff tool to help. https://www.gov.uk/trade-tariff For goods going to the EU, the WTO MFN rates will apply. You can find details here. HMRC’s new Transitional Simplified Procedures scheme will significantly reduce paperwork customs delays for clients importing goods into the UK. You can find the details here. VAT 20% UK import VAT will be due on goods arriving from the EU - but your clients can avoid cash payments via HMRC’s new ‘postponed accounting’ provisions. These mean that UK VAT registered businesses bringing goods into the UK will be able to pay import VAT on their VAT return, rather than when the goods arrive at the UK border. This will apply to imports from the EU and non-EU countries. Postponed VAT will have to be declared in Boxes 2 and 4 of the VAT Return. Customs declarations and the immediate payment of any other duties will still be required. EU import VAT will be due on goods coming from the UK – and many EU states will expect this to be settled immediately. UK e-commerce merchants selling goods to EU consumers under their UK VAT number and the distance selling threshold, will have to register for foreign VAT. UK businesses will no longer be able to use the electronic VAT recovery portal to recover EU VAT. You need to be sure to complete last claims for your clients before Brexit. Supporting your clients through a challenging period The transition period will mean extra costs and inevitable disruption for many of your clients, and some may face financial difficulties as a result. Disruptions to cashflow may be the most pressing problem, although some will need to deal with the loss of customers or suppliers in the EU. At Rangewell, we can help you to help them with solutions such as cashflow support loans, Invoice Finance and Overdraft Replacement. We can also help find solutions such as International Trade Finance. Whatever need you identify, we can work with you to find the business funding solutions your clients need, and search more than 350 UK lenders to ensure you get the most appropriate deal and the most competitive rates. It means an extra service for your practice to provide for your clients - and all our services are free.
Using a classic car as security for a vehicle restoration business
The benefits of staying active in later life are well known, and many more people are now looking at turning a hobby that they love into a business after retiring from their formal career. Leaving the corporate environment and using their skills to be their own boss can be lucrative, as well as personally rewarding. But setting up a commercial business will still involve costs which need to be covered. We were recently approached by an accountant whose client was an engineer - and who had taken early retirement from the petrochemical industry to set up a business restoring classic cars. Specialist skills are required to restore and maintain these vehicles, providing potentially lucrative business opportunities for those with the necessary abilities. The accountant wanted us to find the most cost-effective way to raise funding to equip the fledgeling business. He had a large and well-equipped workshop attached to his home. With some extra equipment, he could set up a business specialising in the serving and restoration of early Jaguar sports cars and saloons. He had already rebuilt a couple of examples, one of which he still owned. "I advised my client against dipping into his pension pot, which would have some painful tax implications. I believed there would be better ways to raise the cash required." The challenge He estimated that he would need around £20,000 to buy in a commercial compressor, a lift and specialist items such as a milling machine and an english wheel. He was confident that he could find all the items he needed on the secondhand market. However, his accountant explained that as a start-up, lenders might not be keen to help. A start-up has no trading history, so lenders have no evidence that it will be successful, and that they will be repaid. Many mainstream business lenders refuse to lend to start-ups as a result. The accountant suggested that Rangewell might be able to find a solution. We work with lenders across the entire market, and we know those who may have a more flexible approach to lending. We looked at suitable funding solutions and saw that the answer was to provide a Secured Loan. Do you have clients ready to start up a new business? See how we can help find financial solutions What is a ‘Secured’ Loan? Like other types of lending, a Secured Business Loan provides a cash lump sum, which you agree to pay back with interest, usually in monthly instalments. They are ‘secured’ because, to arrange them, the lender will require something as security. If you don’t repay, the lender will have the right to take the asset you have used as security. Secured Loans mean more risk for you as a borrower but they are less risky for lenders, which is why they can provide a solution for new businesses which are unable to raise funds by other means. Buildings and machine tools are often used, but it may also be possible to put your own home up as security. You can only borrow an amount less than the value of the security you provide. So you can’t get a £200,000 loan with security worth £100,000. Loans are usually 50–70% of overall asset value. The accountant advised his client against using his home as security - but he did suggest an alternative. “By using his classic 1950 Jaguar as security, my client could raise the funds he needed for the equipment he wanted.” It was an unusual choice of security, and most lenders were not able to consider it. But the car, a rare aluminium bodied roadster, was worth in the region of £450,000. We found a lender who recognised its value, and was prepared to advance the loan. We secured the £20,000 he required at 20% over two years at 8%. He was able to find all the equipment he needed, make a small deposit and take delivery. He was busy from the day he launched his business, and has taken on a mechanic and a bodywork specialist part-time. “The business took off, I have a very happy client - and he tells me it doesn’t seem like work at all.” Getting the finance you need can depend on being able to call on expert advice. As an accountant, you may be ready to find out more about finance to solve your client's start-up or other funding issues. Our experts can work with you to find the most appropriate solutions and the most competitive rates for them. Simply call us at Rangewell on 020 3637 4150 - or email [email protected] Our service is free.
Funding to equip a woodworking manufacturer
£44,280 funding to buy a woodworking machine The latest generation of production tooling offers increased precision and productivity - thanks to ever-more sophisticated technology. With the rise of machines that monitor the work and adjust themselves, accuracy and production throughput is reaching new levels - but so are the costs. CNC production tooling will command a high price - but many manufacturers now recognise that its advantages make it essential. Even sectors - such as woodworking - where a traditional ‘low tech’ approach has been possible, are now adopting production automation. This means that the traditional woodwork operation, which relies on hand-finishing and craft skills, may have no alternative but to invest in sophisticated production systems. Asset Funding solutions can often provide the most cost-effective solutions to help you provide the equipment you need and includes solutions to let you buy outright or lease items of all kinds. We were recently approached by a furniture manufacturer based in Berkshire who had recently taken over the family business when its previous manager realise that the time had come to retire. “We are in the heart of the traditional chair making region, and we could trace the business back to the 19th century, when a craftsman would spend a day in the woods making the spindles for a chair from green wood that he had just cut. We can’t afford to spend that time to produce a chair these days - even if they look very similar. We are making upwards of 100 a day, and I needed to get the production volumes up if we wanted to stay in business for another century.” He had looked at the factory and saw that his equipment had seen better days. He planned on a steady programme of replacement, but he realised that there was a real bottleneck in the production process. “Making complex components by hand takes time. Using a 4 axis CNC-controlled router can not only get the component - which can be as large as a boardroom tabletop - made faster, it can do it to accuracy that hand work simply cannot compete with. The costs come right down - but the big obstacle is the cost of buying the machine - and the control systems that go with it.” He found a supplier ready to provide and install the machines he needed - but the total cost of the new equipment came to £44,280. He wanted to spread the cost with Hire Purchase - but he was concerned that the finance plan offered by the dealer - with an interest rate of 15% - was expensive. He turned to our finance team at Rangewell. Asset Finance and your business Asset Funding can be the most cost-effective way to provide funding for equipment of all types. It differs from a straightforward loan in one simple respect - the security for the loan is provided by the equipment itself. This means if your business is unable to repay the funding, the lender can simply repossess the equipment and sell it. As a result, the risk to the lender is much reduced - which, in turn, means that the rate offered to you as a borrower may be reduced too. Hire Purchase can be the simplest form of Asset Finance. With Hire Purchase, you effectively hire equipment until you’ve paid enough to purchase it. This normally requires you to pay an initial deposit followed by fixed monthly repayments. When you’ve made all the repayments, your business will own the equipment outright - making Hire Purchase ideal for durable items that you will want to keep and use for the long-term. Leasing is an alternative that allows you to finance assets without buying them. This allows you to regularly update equipment and, in some leasing arrangements, you have the option to own the asset at the end of the term, upgrade it, or simply give it back. You can also decide whether you want maintenance and insurance to be included and whether you need the item for its whole working life or a shorter, agreed period. Asset Finance can also provide funding for used machinery. There are many lenders providing Asset Finance, but Rangewell’s expertise can help secure the most competitive rates - frequently undercutting those offered by equipment dealers. The challenge Asset Finance is a routine type of business funding, and can usually be arranged quickly - especially for borrowers with an established business. However, although our client had a business with a record of profitability that went back years, his own credit history was less than perfect. He had missed some loan payments in the past - and as he had been running the business for only a short while, lenders saw his personal history as a red flag. He approached Rangewell to provide a solution. Rangewell found a specialist Asset Finance provider which could provide the £44,2800 funding at a preferential rate of 12% above base rate over 5 years. The looked at the value of the machine and the profitability of the business rather than at the client's credit history - which may be unavoidable with less specialised lenders The funding Rangewell arranged: £44,2800 over 5 years at 12.75 % Monthly repayments £983 or Annually £11,796 The process was simple and - because we were able to approach lending specialists at who understood the manufacturing sector - it was arranged in the minimum time. At Rangewell, we help businesses of all kinds find better answers to all their funding needs. Our expert teams find the most appropriate funding solutions while our network of lender contacts and our unique online tool let us find the most cost-effective rates. Simply call us at Rangewell on 020 3637 4150 - or email [email protected] Our service is independent, fast and absolutely free.
A Commercial Mortgage for an SPV: an accountants POV
Many of your clients may be setting up limited companies as Special Purpose Vehicles or SPVs – to avoid punitive taxation on BTL property investments. If you advise clients to take this route, you may need to help them find suitable funding. As an accountant, one of the challenges you face is to find the most cost-effective - and tax-efficient - ways for your clients to pursue their business plans. Buy to Let remains a vital part of the housing market. The government has made some changes to tax relating to BTL investments, intended to make them less attractive to individuals. Many accountants have seen ways to mitigate these measures and are advising Buy to Let borrowers to set up limited companies as Special Purpose Vehicles or SPVs. It means greater tax efficiency – and with help from the mortgage experts on the Rangewell team, it can mean lower rates too. The challenge At Rangewell, we were recently contacted by an accountant whose clients were a husband and wife partnership who ran a number of small corner shops in East London, and had seen an investment property close to one of their retail outlets. The property had been tenanted for several years, and which they believed could be let to tenants on a room-by-room basis. They had experience as landlords, with tenants in the flats above their shops, but their accountant pointed out that, although their plans looked sound, there could be some challenges. One challenge was the fact that the property would be an HMO. A rental property is classed as HMO, or House in Multiple Occupation, when it is let to unrelated tenants. The usual model is to provide individual bedrooms served by common living areas, including kitchens and bathrooms. Most Buy to Let Mortgages will include a clause specifically excluding HMOs. Lenders have historically seen this type of arrangement as presenting a higher risk than a property let to a single tenant. A special mortgage will be required for an HMO. Not all lenders will provide it, and many of those that will consider lending on an HMO will only do so for borrowers who have experience in the sector. The accountant was also aware that there was an additional problem with the couple’s take-home pay. Despite their successful shops, their actual take-home pay was below the threshold for many Buy to Let deals. The accountant came to Rangewell for help. How we helped find a funding solution We looked at the figures with the accountant and, at his suggestion, that he helped his clients set up a Special Purpose Vehicle (SPV). These limited company arrangements can be used to isolate the risk of a particular project from other business activities. The accountant was able to set up an SPV online in a few minutes. "SPVs are ideal to hold the property and the income and expenditure of Buy to Let property. Lenders offering mortgages to corporate vehicles may prefer SPVs to trading limited companies because they are easier to underwrite - there is no risk from other business activities." Do you have clients looking for Buy to let investments? See how we can help cut their costs They would overcome any affordability issues stemming from the couple's apparently low income from their other businesses. As a purely Commercial Loan to a limited company, the only factor taken into consideration by the lender would be the profitability of the property itself. But there was another advantage. An SPV was an important plus which would open the door to many more deals, some of which might include particularly attractive rates. We looked at various lenders and at their assessment criteria, which can vary between lenders. Some may take the personal financial history of the company directors into account, others will base decisions purely on the SPV structure. Lenders usually require the directors to guarantee the debt personally. The low income of the couple was a problem with most lenders but, with a successful business plan showing more than adequate and income from rentals, one lender was prepared to offer a very attractive deal. We were able to source a 75% loan at 4.39% fixed for two years with a 3.00 % fee, on a 20-year interest-only deal from a specialist property lender. Even after costs had been dealt with this meant that the property offered a very worthwhile cash profit for the couple – which the accountant was happy to recommend. So if you're ready to find out more about finance for your clients' SPV plans, simply call us at Rangewell on 020 3637 4150 - or email [email protected]ll.com. Our service is always free for accountants and their clients.
How to grow an events business
Great parties, weddings, product launches and conferences don’t just happen. Successful events - for communities, businesses and families - have to be very carefully planned, organised and run on the day. This means that there is always a need for good events planners - and plenty of scope for you to grow your events planning business. In fact, once you have established your niche - the type of event you specialise in - growth should be a big priority. If you are not the go-to business for your sector - somebody else will be! So what are the key growth tools you need? Networking Networking is at the top of your list when you are looking at growth. Events planning is a people business - the more people know you, the more chances you will have of securing their next event. “It's not what you know, its who you know. That's certainly true in this business. People want to do business with people they feel they know and can trust - so the more people that know you and your business the better off you can be.” So be gregarious. Always carry your business cards - you never know when you will run into a potential client - and always make sure you meet as many people as possible. When people at events you have arranged have met you and know what services you offer, they may refer business to you or use your services themselves. “My business is mainly children’s parties. Mums talk to other mums, and if you arrange a great kids party for one, all her friends can be on the phone to you.” But there is another side to networking. Networking with hotels, caterers and all the other suppliers in the market will give you more chances to meet the people whose services you will need. Having alternative suppliers can solve problems when one is busy and can’t help - and when you want to negotiate to get the best price. “I landed a big society wedding party just because I left my card with the receptionist of a stately home hotel near where we are based. Their usual people were busy that weekend, so they called us in instead.” Plus, those suppliers can be ambassadors for your business. Ask suppliers such as florists, caterers and photographers if you can leave a stack of business cards - or even leaflets - in their places of business. Advertising Most planners agree that print advertising still makes sense - if you are careful where you place your advertising. There is no point in spending money advertising in your local paper if your business is aimed at the corporate market, for example. In this case, a regional business magazine might well be a better choice. “Advertising is expensive, but you can’t afford not to do it - it brings in customers, and without them, you don’t have a business.” If your focus is on weddings, a specialist bridal magazine might be the answer - although you might want to look at one of the county magazines, which might give you the geographical coverage you need. Events such as children’s parties might benefit from local advertising, and your local paid title or freesheet should be able to give you a discount if you take a regular advertisement in every issue. It might also be a good idea to have leaflets made which you can leave at venues. Many people will approach a venue first when they are thinking about an event. If the owners can give out your details, you could both be looking forward to extra business. Looking to grow your events business and bring in more clients but unsure how to cover the additional expense? Find out what funding solutions are available for Events Management businesses, or apply today Online advertising The rules of advertising and marketing have been turned upside down by the internet. Most people spend more time on their screen and mobiles than they do reading papers and magazines. “You can’t not be online these days. If they can’t find you online, people think you have gone out of business.” Despite what you might think, it is relatively simple, not only to advertise online but to do so in a way that only reaches people likely to be your target market. You may need some specialist help from an online marketing agency, but you should be able to look forward to a steady stream of enquiries from online contacts. You may also be able to use email marketing to go direct to the inboxes of decision-makers in business who may be in need of your services. It is also possible to buy in the lists of people you need, complete with names and email addresses but, again, getting the help of specialist online marketers may be essential. Your website Both online advertising and email contacts will need the support of a website. Having a website for your events business is now essential - potential customers will check out your website and make a decision about whether or not to do business with you before they even think about calling you. “You need a good website because it represents your business online. It has to look professional, and look right for the kind of clients you want - and make it easy for them to call you.” This means your website must be professionally designed and built if it is to give the right impression of your business. Include pictures of events you have run in the past, list your services and ensure that your content appeals to the people you want to work with. A fun site might be ideal if you are doing hen parties - but it will put off corporate clients who want a businesslike approach. Look at what your competitors are doing on their websites. See what they are doing that is right - and how you could do it better. Also, make it easy to contact you via your website. Include your phone, mobile and email - and your photograph. It can be a big help in persuading people to contact you as they feel they already have an idea of who they will be dealing with. What about the costs? The costs of business cards - even business cards with extra features like fold-outs that ensure they stand out and get remembered - is trivial, and even full colour leaflets can be provided at a low cost by your local printer. However, the cost of building a website, supporting it with social media and creating email campaigns and paid advertising could be substantial. Even a basic website will cost around £5000 in the first year, and online advertising will probably cost as much again to bring in the level of response you need to start moving your business forward. “You probably need to keep your costs down, especially in the early years of your business. But you can’t grow unless you spend. If you don’t have the spare cash you need to invest in your marketing, you need to borrow it.” This may be a substantial ongoing expense, but if your events business has been trading for a year or so and has some successful accounts to show, getting the funding you need to cover it may not be too difficult. It may simply be a matter of approaching the right lenders, and presenting them with a sound business case as to why you need the money. Something like a Small Business Loan can be arranged quickly, and the repayments kept in line with your cash flow. At Rangewell, we can help you find the most appropriate lenders, and even support you through the application process, ensuring that getting the funds you need can be straightforward - and that you can have them at a rate that suits your business. Getting a Rangewell Finance Expert on the side of your events business could prove to be the simplest way to grow it!
How we arranged a Commercial Mortgage to buy a nightclub - fast
The way to find large-scale finance – fast The nightclub sector has become a multi-million-pound industry. Some of the major dance-music superclubs with big reputations and serious followings compete nationally, as clubbers are willing to travel across the country to attend them for top party nights and sets from world-renown DJs. Some of these clubs can accommodate thousands of customers a night, and generate huge profits from entry fees as well as drink sales. There are a handful of really popular clubs that can generate a turnover of £100,000 plus per night on Fridays and Saturdays - leading to very attractive profits for their owners. As a result of this profitability, on the rare occasion that a really successful nightclub changes hands, very large sums can be involved. At Rangewell we recently provided £2,000,000 worth of funding to support a club owner in buying a second major nightclub. But we did not just work to find a lender who could offer the scale of funding required - we used our expertise to help the owner move fast enough to secure the deal. The challenge The club – situated in an Essex commuter town - has built a national reputation, having been open for more than 20 years and attracting customers, not just from the local areas and around the M25 – but coach parties from as far away as Manchester too. The owner had built the business up from its launch but felt that the time had come to concentrate on his other business interests. He valued the business at £3,200,000 – and had found a buyer prepared to offer the asking price. However, this buyer was having difficulty raising the funding required. At Rangewell, we were approached by another London nightclub owner whose club had reached capacity – and who saw the potential in the Essex venue as an extension to his own business. He was prepared to offer an additional £100,000 in order to secure the club. Naturally, the owner was happy to accept the counteroffer – but he wanted to release funds as soon as possible to support a property development project he was involved in. He would only accept the new offer if the London club owner could provide the funds before the first potential buyer could make good on his offer. The client turned to Rangewell to help raise the funds. We knew that he would be able to contribute a large cash sum - but would still need to raise £2,000,000, and ideally, in a matter of days. His bank would take three weeks to provide the funds required – and the owner was only willing to sell to the first buyer with the funds. We knew that we would have to work fast, and contacted our client's bank. They were happy to provide an approval in principle – but their procedures could not be hurried along, and would take at least fifteen working days – if everything went smoothly. Do you need high-level funding fast? Contact one of our Funding Experts or apply today A fast solution to beat the competition Fortunately, we were able to use our network of contacts to find a private lender who was able to advance the necessary funds as a Bridging Loan secured on the nightclub premises – and with the confidence of having a loan in principle agreed by a high street bank as an exit strategy. Costs were relatively high but, with our support, the lender was able to conduct the necessary due diligence in a matter of days – successfully securing the deal. This type of finance is called a Bridging Loan because it is designed to bridge a short-term funding gap. Bridging Loans are short-term loans secured on property and are usually repaid quickly, either by the sale of the property or by another, more economical finance product designed for the long-term, such as a mortgage. Bridging Loans can often be used to fund business and property purchases, but there is no restriction on how funds can be used. So if you are faced with a sudden expense - or if you need finance to take advantage of an opportunity - a Bridging Loan secured on a property you already own could provide the answer - and quickly. The loan can be as short as one day and run up to a maximum of 12 months. Loan amounts start at around £25,000, and there is no maximum. Our client took over the nightclub, which stayed open, and replaced his Bridging Loan on schedule as soon as the funds were ready from his bank. Do you need large scale finance – and do you need it fast? Simply call us at Rangewell on 020 3637 4150 - or email [email protected] and speak to one of our Business Funding Experts to see if we can do the same for you. Our service is free.
£1,800,000 refinance for a pharmacy
Getting the large scale finance you need to buy a business can be a challenge. Unless you are a financial professional with expert knowledge of the lending market, the work of chasing down lenders and trying to secure offers can be time-consuming and frustrating. When you have a business to run, there are plenty of other demands on your time. As a result, many borrowers are prepared to take an offer that seems reasonable rather than invest even more time to see if they can find a lower rate. It means that many business borrowers - including many pharmacists - are stuck with finance deals that cost them much more than is necessary. It means an extra drain on their cashflow and puts their business at a competitive disadvantage. The simple answer is to turn to the experts at Rangewell to find the most competitive deal. In fact we can frequently save our clients money after they have already arranged finance - with refinance. We were recently approached by a pharmacist who had arranged £1,800,000 funding to buy his business - and who realised that he might be able to save a great deal of money by refinancing. “I had bought my chemist shop two years ago, with the help of £1,800,000 lending from my bank. I was pleased at first. They had offered me a rate of 3.5% over base, and it seemed a good deal. Then the base rate went up a little and I started to worry. What if it went up again, and was the deal I had really as good as I had thought?” He realised that finance was not his core skill, and turned to Rangewell to see if we could help. “Rangewell don’t charge for their services, so I thought I had nothing to lose by approaching them to see if they could find me a better deal.” How we helped We have a specialist team with an understanding of the pharmaceutical sector, and our service is personal. It means that by calling us you can have an expert in funding for your kind of business working to get you the finance you need. Do you need help with refinancing your business? We can help you find a better deal to cut your outgoings. Like our client, we saw that with large scale funding, any increase in base rate would mean a large increase in his monthly repayment costs - but equally, it would mean that any reduction in rate we could provide would mean valuable savings. The client had been running a successful business for two years. He was, therefore, a better prospect for a lender, and that we should be able to arrange a better rate. The pharmaceutical sector is particularly attractive to lenders. They may compete with each other to lend, because pharmacists, like other professionals, are seen as very likely to repay even large loans without problems. By approaching several lenders, we can make this competition work for our clients advantage. We could use our personal contacts with banks and other lenders to go directly to decision makers. By speaking to the experts in the pharmaceutical sector we should be able to get a more favourable deal for our client. We approached several lenders, and were able to find an offer of refinance at just 2.5% over base - a saving of a whole percentage point. This would allow the original loan to be paid off, and replaced with a lower cost deal. It meant a major saving for our client. Original loan £1,8000,000 at 3.5% above base of 0.5% Monthly repayment £13,249.97 Original loan £1,8000,000 at 3.5% above base of 0.75% Monthly repayment £13541.01 Refinance loan £1,8000,000 at 2.5% above base of 0.75% Monthly repayment £ 12648.04 Monthly saving £893 “I was saving nearly £900 every month - which is a worthwhile reduction in anyone’s book. But I wanted that saving to work for me.” The client's shop was in need of refurbishment - and with an extension to the rear it could offer almost double the sales space as well as a refreshed interior. The client asked about the possibility of adding an extra £300,000 to his borrowing - which thanks to his new rate would be very affordable. Total borrowing £2,100,000 at 2.5% above base of 0.75% Monthly repayment £ 15797.85 “The monthly repayment costs were up a little - but thanks to Rangewells help with refinance, I was getting a lot more in return - enough to give my business the extra investment it needed to reach its full potential.” Our client has already started on the extension to his premises, and is looking forward to a big boost in his profits as soon as they are complete. We help pharmacists - and other business owners - with all their funding needs. If you are ready to refinance your pharmacy, our pharmacy funding specialists are ready to provide the help you need - and call on our contacts throughout the lending industry to secure it. Our service is independent, fast and absolutely free - and means having an expert in pharmacy sector finance working to find you the answers you need. To find out more about what we can do for you, simply call us at Rangewell on 020 3637 4150 - or email [email protected]
Finding funding solutions - for the agricultural sector
£30,000 loan over 6 months to buy livestock We were recently approached by a tenant farmer from Lincolnshire for funding. He needed £30,000 to buy a herd of beef animals for bringing on - but he found he faced difficulties in raising the funds he needed. His usual funding provider - his bank - was unable to advance that level of funding, and many other lenders are reluctant to serve the sector, which they regard as too specialised. Rather than attempting to make a lending decision on a sector where they do not understand the challenges involved, they prefer to leave it to specialists. However, many specialist lenders are becoming increasingly selective in their lending - particularly to farmers in the livestock sector. There are several reasons for this. Pressures on livestock farmers are increasing. There is a growing demand for organic standards throughout meat and dairy operations. There are increasing concerns about animal welfare, especially on intensive operations - and this can mean conflicts with the constant pressure from buyers for reduced costs. This can, in turn, mean that some areas of the sector - including our client’s - are only able to demonstrate marginal profitability. Lenders may be highly selective, even in those sectors that they are usually happy to work in. The challenges In the case of our client, there were several other issues which worked against him when he applied for funding. As a tenant farmer, he did not own his farm or his home, leaving him with no way to provide security for lending. Perhaps even more important, he had not been a major user of credit in the past. Working as a cash business may have its advantages, but it tends to mean that you will not develop a credit history. Lenders always look at an applicant’s credit history when considering making a loan. They will want to see a good record of borrowing and repaying in the past, as a sign that an applicant will be able to repay any new loan. A default on a loan may be an absolute red flag for many lenders, who will simply refuse to deal with those who have run into this kind of problem in the past. However, the lack of a credit history can also cause problems. In the case of our client, because he had never had a mortgage or any kind of business loan in the past, his credit history was almost non-existent. While he was present on the electoral register and had some tax records, most of the usual data used by lenders to determine the suitability of an applicant for a loan were lacking. Even those lenders who might be able to consider him for funding were unable to proceed without the information required - their systems were simply unable to process the application. Our client needed the funding quickly to bring in the animals he wanted - he had no other way to generate any profit for his business. He turned to Rangewell to help. Contact Rangewell today and see how we can help you support your clients - in any sector - with business funding How we were able to help Our approach is very different from conventional business funding advisors. Whereas many are tied to a few lenders, we are completely independent. This means that we can search the entire business lending market for solutions, and because we know all the lenders in the UK, we know which are the most suitable for any particular finance challenge - including those able to help when the borrowing needs are less than ideal. At Rangewell we know the specialist lenders who cater to people and businesses who present a credit challenge. Their services are often not advertised, but our network of personal contacts is essential to locate them - and to arrange the funding. In this case, we contacted one of these specialist lenders and explained the challenges presented by our client. There were some major negatives. The farming sector was a challenge, as was the lack of owned property. The lack of an established credit rating was even more significant. However, we were able to approach a long-established lender with close connections to the agricultural sector. We know that they have been able to offer funding for cattle and sheep in the past, and that they might be prepared to do so again. The fact that our client had a long history as a successful farm operator was a significant factor for this lender. We arranged the loan, which allowed the farmer to buy in the animals required, and to bring in feed for them - with sufficient surplus funds to deal with vets bills and other costs until they were ready for market. The loan Rangewell arranged: £30,000 at 10% over six months Interest rolled up until the cattle were sold on Charge for loan £1,500 Finding the one lender who was able to help is all part of the service at Rangewell. To find out more about how we help the agricultural sector find the funding they need, simply contact our agricultural finance team.