Three questions with Sharon Chalkley, Managing Director of Transport Burton
We are pleased to welcome you to the latest edition of our Inside Newsletter. It offers an overview of our finance products, with examples throughout of how we have helped UK SMEs fund assets and grow their businesses. In this issue you will find crucial research highlights that look at the rising cost of doing business for UK SMEs, as well as case studies that highlight our Refinance and Hire Purchase products. There is also a Q&A with Sharon
Chalkley, Managing Director of our Burton Transport team, who highlights some of the ways we can support our customers and what sets us apart from our competitors. You will also find out more about the upcoming events our sales teams will be attending as well as a look at the Growth Guarantee Scheme. We were recently accredited under this government backed scheme by the British Business Bank, which supports access to finance for small businesses
across the UK as they look to invest and grow.
We hope you enjoy the read and if you are looking to invest in a new asset or refinance an existing asset then please don’t hesitate to get in touch at:
closeassetfinance.co.uk/enquiry
Most expensive asset financed
Did you know the most expensive standalone asset we have financed this year was a Bombardier Global Express XRS jet to the value of £8 million?
How many assets have we funded in 2024?
So far, we have funded over 15,000 assets this year including:
5,786 vehicles 145 tractors
46 boats 498 excavators 73 printing presses
Research highlights impact of rising business costs on UK SMEs
Recent research has revealed the significant impact of rising costs on businesses across the UK, with a majority of respondents reporting adverse effects on their operations and financial health.
According to the research, 71% of businesses have been affected by the rising cost of doing business, while 25% reported no impact, and 5% were unsure.
Among those experiencing increased costs, 56% indicated that it has negatively impacted their cash flow. Conversely, 27% reported no negative impact on cash flow, and 15% have not noticed an increase in costs.
The survey also identified the top five primary inflationary cost pressures affecting businesses – in order of most impactful:
Supplier costs
Energy
Fuel
Interest rates
Rent
67 % of businesses have passed their increased costs to customers completely.
24% of businesses reported wage increases in the past six months. 54%
These findings underscore the challenges faced by UK businesses in the current economic climate, highlighting the need for strategic planning and support to navigate these pressures. of businesses have seen their business insurance costs rise in the past 12 months.
“The rising costs of doing business are presenting significant challenges for many enterprises across the UK,” said Anton Nebbe, Head of PR and Communications, and responsible for commissioning research at the firm.
“Our research highlights the critical areas where businesses are feeling the pinch, from energy and supplier costs to increased insurance premiums.
“At Close Brothers Asset Finance, we are committed to providing the support and resources businesses need to navigate these pressures and continue to thrive. By understanding these challenges, we can better assist our customers in developing strategies to mitigate these impacts and ensure long-term success.”
The thrilling expansion of Eventive Funtime
Eventive Funtime, a renowned fairground and events business, successfully secured a refinance deal to expand the company.
Customer background
With a legacy spanning 28 years, Eventive Funtime has been directed by Garry Morgan Evans Snr, earning an excellent reputation within the fairground industry. The company operates several classic fairground rides across the country and has fixed locations, including an arcade in Matlock.
Refinancing for the future
Eventive Funtime wanted to refinance their newly refurbished Miami fairground ride to expand their business, and – having previously worked with Close Brothers Asset Finance – contacted us for a tailored refinance agreement to support their growth plans.
Solution
Julie Fisher, Regional Manager at Close Brothers Asset Finance, crafted a bespoke
refinance deal for our customer, releasing the capital they needed to progress their business.
Results
The deal was a significant step for Eventive Funtime because it helped their sister company to facilitate the purchase of the caravan park situated behind the company’s amusement arcade, significantly enhancing the business portfolio and customer experience.
Julie Fisher, Regional Manager, said: “This move is a testament to how refinancing assets can effectively fuel the expansion of a business. Using the residual value in assets – like Eventime Funtime did – is an ideal way to fund growth.”
“We’re thrilled with the refinancing solution that has enabled us to expand our businesses further. It’s a step forward in solidifying our presence in the industry and the community.” - Garry Morgan Evans Snr, Director, Eventive Funtime.
Benefits of Refinance
• More time to repay: We can take over the finance agreement you have with another provider and extend the term, which is fixed along with the charges so you will not incur any surprises during the lifetime of the loan.
• Improve efficiency: Refinance offers a straightforward and quick way to secure additional working capital for your business requirements. You can continue to use the asset offered as security against the loan.
• Choice: Give your business a cash injection or use the money to buy other assets that may not be accessible through Hire Purchase or Leasing agreements.
• Make fast decisions: By releasing capital, refinance can help you make faster decisions when negotiating business contracts.
Finance is secured against the asset and/or equipment. If you're unable to keep up with your payments we may repossess the asset and/or equipment.
Growing Yorkshire Rescue Services’ fleet
Yorkshire Rescue Services, a large vehicle recovery business, grew their fleet of vehicles through a Hire Purchase agreement.
Customer background
Founded in 2015 by Andrew Alderson, Yorkshire Rescue Services provides a 24-hour rescue and recovery service for vehicles in the Leeds, Huddersfield, Bradford and Halifax areas of Yorkshire. With a fleet of over 45 vehicles, the business has grown over the past decade to now provide MOT and service options as well as their recovery services.
A growing demand
The business was recently given additional work by a national breakdown service provider as well as a local truck dealership. To meet this demand, Yorkshire Rescue Services purchased two new MAN Recovery Vans fully fitted with roadside equipment, including compressors, generators, racking, electric packs and tyre fitting equipment.
Having previously worked with Close Brothers Asset Finance, Andrew approached Dan Lynch, Regional Sales Manager, for assistance in funding the two new vehicles.
Solution
Dan suggested purchasing the vans using a Hire Purchase
agreement, which would spread the payments across a fixed period, making it easier to budget. Yorkshire Rescue Services would also own the assets at the end of the agreement term.
Result
This new agreement was another step in the growth of Yorkshire Rescue Services. By adding two more vehicles to their fleet, they have expanded their operating capacity, which has allowed them to meet the demands of their new business contracts.
Dan Lynch, Regional Sales Manager, said: “It has been a pleasure to work with Andy and his team at Yorkshire Rescue Services on this recent deal. By using Hire Purchase we have accelerated the growth of their fleet of recovery vehicles helping to meet their growing business demands.”
“We are delighted by the recent agreement for the two new recovery vehicles to our growing fleet. As a recovery vehicle operator, it is imperative that we always have enough vehicles to help our customers as quickly as possible. I found Dan Lynch at Close Brothers Asset Finance very helpful, and I wouldn’t hesitate to approach him again if we required finance in the future.” Andrew Alderson, Director, Yorkshire Rescue Services
Benefits of Hire Purchase
• Maintain Control: You stay in control because you can use the asset while repaying, and you usually get to claim capital allowances. These allowances are a way to reduce your business taxes by deducting some or all of the asset’s value from your taxable profit.
• Seasonal Flexibility: We understand that your income can vary at different times of the year and we can adjust your monthly repayments to take these fluctuations into account.
• More time to repay: You can spread the cost over the asset’s life, and the fixed monthly payments make it easier to budget.
• Tax Efficiency: Financing your assets using Hire Purchase can be more taxefficient than regular loans because lease payments are treated as expenses.
Finance is secured against the asset and/or equipment. If you're unable to keep up with your payments we may repossess the asset and/or equipment.
Product spotlight
Finance Lease
How it works
Finance Lease is a long-term rental for business assets. Instead of buying the asset upfront, you pay rent to use it, with a flexible rental period to match your needs and cash flow fluctuations. You cover the cost of the payments, including the agreed interest for the duration of the rental period. At the end of the initial lease, you have options to continue leasing, sell and earn, or return the asset.
Benefits of Finance Lease
• Get what you need without a big upfront cost: Quickly acquire the equipment without a large initial payment
• Customise payments to match your cash flow: Adjust rental payments and lease periods to match your cash flow
• Earn money back: Sell the equipment at the end of the lease and earn from the sale
• Tax Benefits: Pay VAT only on monthly rental payments, reducing taxable profit and potentially saving money on taxes
Finance is secured against the asset and/or equipment. If you're unable to keep up with your payments we may repossess the asset and/or equipment.
Operating
Lease
How it works
Operating Lease allows you to rent an asset for as long as needed, covering a portion of its total useful life. The rental fee is lower because it’s based on the difference between the asset’s initial purchase cost and its residual value at the end of the agreement. You have complete access to the asset without the obligation of managing its disposal or recovering its residual value.
Benefits of Operating Lease
• Low upfront cost: Acquire the asset quickly without a large initial payment
• Freedom: Use the asset without purchasing it outright
• Flexibility: Choose to rent again, buy, or return the asset when the lease ends
• Lower expenses: Rental fees are based on a fraction of the original purchase price
Finance is secured against the asset and/or equipment. If you're unable to keep up with your payments we may repossess the asset and/or equipment.
Sharon Chalkley Managing Director, Transport Burton Three questions with
What challenges do you expect our customers will face in the next 12 months?
As prices continue to rise across various industries, our customers are finding it increasingly difficult to manage their cash flow, which in turn impacts their ability to expand. This is particularly evident in the Transport sector, where several challenges are emerging.
The cost of new vehicles, fuel, and insurance is increasing, putting significant pressure on hauliers. In addition, the uncertain economic environment has led to a reduction in available work for hauliers, while many are holding onto their existing assets for longer instead of investing in regular replacements, as they had done previously.
This extended use of older assets has also caused maintenance and repair costs to rise.
In the Coach sector, the high prices of used vehicles is making fleet upgrades very expensive.
Many firms surveyed in our SME report were concerned about cash flow. How can Close Brothers Asset Finance support them?
We understand the challenges businesses are facing and we’re here to help. With our Refinance product we can support firms that need a cash injection. This can involve unlocking funds from unencumbered assets or those with equity, whether financed by us or another lender.
This solution allows businesses to leverage the value tied up in their existing assets, giving them
the flexibility to navigate cash flow concerns more smoothly.
What sets Close Brothers Asset Finance apart from our competitors?
At Close Brothers Asset Finance, it’s our service that sets us apart. We are committed to never overpromising and underdelivering, ensuring our clients receive prompt and reliable support.
We understand not everyone is the same, and there is no one-size-fits-all solution. Each customer and proposal is reviewed individually, allowing us to tailor our services to effectively meet specific needs.
We genuinely care about everyone we work with, and are dedicated to supporting the haulage industry through both good times and challenging periods.
Upcoming Events
Our teams of experienced industry experts will be out and about meeting our customers at several industry events this year, come and meet them for a chat in person:
6 – 7 November (Stand FM131) Our agriculture team will be exhibiting for the first time in the Farm Business Innovation section of the show.
15 – 16 January (Stand 18.446) The agriculture team will be exhibiting again at the UK’s premier farm machinery show.
4 – 6 February (Stand F215) The manufacturing and Finance for Industry teams will be exhibiting again at the Farnborough Exhibition Centre in February.
12 – 13 February (Stand A18) Our construction team will be returning to the Coventry arena this year for the national event for tools, plant and equipment hire.
19 February
The agriculture team will be exhibiting for the first time at this unmissable event for South West farmers.
26 – 27 February (Stand B13) The construction team will be exhibiting for the first time at the UK’s only dedicated concrete event.
This is just a small sample of the many events we have attended this year with lots more planned. For the latest list of events we are exhibiting at or attending visit: closeassetfinance.co.uk/events
Close Brothers Asset Finance accredited to provide Growth Guarantee Scheme (GGS)
We have been accredited by the British Business Bank (BBB) under the government-backed Growth Guarantee Scheme (GGS), which supports access to finance for small businesses in the UK as they look to invest and grow.
The accreditation follows the funder successfully supporting smaller businesses through the two preceding schemes, the Coronavirus Business Interruption Loan Scheme (CBILS) and the Recovery Loan Scheme (RLS).
The Growth Guarantee Scheme –which is a successor to the Recovery Loan Scheme – launches with a wide range of products, including term loans, overdrafts, asset finance, invoice finance and asset-based lending.
The scheme can support facility sizes of up to £2m and businesses can use the finance for any legitimate business purpose – including managing cashflow and investment.
Matt Roper, CEO of Close Brothers Commercial, stated: “We are delighted to have been accredited by the BBB. The GGS provides both lenders and the business community with the continuity needed to create confidence while allowing SMEs to plan for the future.
“A key feature of the scheme is to improve small business’ access to funding across all sectors and regions. Government-backed guarantees like the GGS encourages and enables lenders – like ourselves - to provide support to a wider range of businesses, something we did very successfully with CBILS and RLS.”
For more information on the Growth Guarantee Scheme and eligibility please visit: closeassetfinance.co.uk/ggs
