Even though community pharmacy funding escaped the government’s proposed £33m budget reduction for 2018/2019, pharmacists are naturally dismayed that it has not been increased. Past history of austerity measures indicates that cuts may well come sooner rather than later. Uncertainty has made many community pharmacies look to private sources of funding to acquire the modern assets required for growth. These include cash loans from banks and other providers. Depending on what the funds are needed for, asset finance may be a more accessible and cost-effective alternative.

When you have a compelling business case to grow a section of your business, it’s time to act and turn potential into reality. The right equipment can transform your productivity, capacity to innovate, your processes and profitability. If the equipment cannot be purchased from working capital, the finance options are either a bank loan or asset finance. What are the differences between these two types of lending?

Asset finance is a good funding choice for expanding businesses because it is easily accessed, secured by the asset, and fast to obtain. Possible business applications include:

Business growth frequently requires capital investment that cannot always be met from existing resources. In these cases asset finance provides a cost effective means of acquiring vital equipment straightaway without straining your cashflow or having to take out a large loan. Even when adequate capital is available, asset finance enables it to be conserved or more usefully directed towards other areas of the business.

Calculating an organisation’s credit rating is a delicate art. The calculations include:

As of 1st January 2019, the Annual Investment Allowance (AIA) has increased from £200,000 to £1 million, a very welcome New Year’s gift to UK businesses! Let’s explore what the AIA means and why you should act this year to take advantage of the opportunities it offers.

Asset finance is one area where banks still consider advancing finance to SMES. However, there are circumstances where a bank may still decline applications from profitable, established companies. For example, where the asset is outside of the mainstream asset class types or the industry is considered high risk.

Asset finance is fairly unique in business financial products because it uses the asset in question as security for the advance. This can often reduce the amount of checking that the lender needs to perform, making the process faster and easier than, alternatives such including applying for a traditional bank loan. In fact, the speed and ease with which asset finance can be made available is one of the factors that make it such a popular financing option with businesses.

Acquiring equipment can eat up significant amounts of capital, which may starve growth potential when you want to focus investment on other areas of your business. Likewise, capital can be locked up in existing assets and releasing it can deliver the required investment funds. Asset finance is a flexible mechanism that provides easy and fast funding for any business purpose, which can indirectly ease cash flow concerns.

Businesses seeking finance no longer need to depend on conventional bank loans. Nowadays, there are many options available in the alternative finance markets from specialist service providers. This means greater flexibility in choosing appropriate products, terms and repayment plans.