Raising finance for your business

 

Now more than ever, businesses globally are seeking finance and investment. Not just to support them through economically tough times, but those who want to diversify and adapt to consumers changing needs. This article will give you more advice on how to achieve finance for your business.

 

The backbone of any company is a great business plan that covers all scenarios from start to finish; including an effective exit strategy – see our article for more advice on Exit Planning. And of course, part of the business planning process is also financial modelling. How do you know that investing £350,000 on property and equipment to open your new business is actually going to deliver the returns you are hoping for? Potential investors and lenders will want to see a clear plan of action. There are no guarantees in life, but we can help to give a much more realistic picture of the future by developing a model for your business. This model will consider your individual business and also look at competitor businesses and standards for the relevant sector.

The pandemic made finance more readily available to businesses needing financial support. CBILS loans and bounce back loans (after a slow start) have been handed out left, right and centre to businesses across the country. However, in normal times loan applications can be a bit trickier. The cheapest option will almost always be the High Street banks and we have excellent connections with them. This relationship allows us to understand what the bank is looking for and suggest the best fit for our clients. If you are a business without a relationship manager at your High Street bank, going through an accountant can really take a lot of the hassle out of the process.

 

Coronavirus Support Packages

Coronavirus Business Interruption Loan Scheme (CBILS)

This business interruption loan closed applications on 31st March 2021. Suited to SME’s, the scheme aimed at providing access loans and other kinds of finance up to £5 million.

 

Bounce Back Loans (BBLS)

This scheme also ended on 31st March 2021. The scheme helped small and medium-sized businesses to borrow between £2,000 and up to 25% of their turnover.

 

Coronavirus Job Retention Scheme

The furlough scheme has been extended until 30th September 2021. You can no longer submit claims for claim periods ending on or before 31 October 2020. For more information see Gov.uk here.

 

Self-Employment Income Support Scheme

A fourth grant is now available, and if your business was previously eligible for funding, you should now have been contacted by HMRC. You must make your fourth grant claim by 1st June 2021. See more here.

 

Investments & Traditional Finance

Now is a great time to review your business and adapt to the changing UK economy. Online shopping, contactless payments and outside/ takeaway services have boomed more than ever before. Is your business up to date with your customers’ needs? Do you need investment to realise these improvements?

 

  1. High Street banks – term loans – almost always the cheapest, but there can be a number of hurdles to jump through to secure funds.

 

  1. Private equity investment – possible as a loan or equity, likely to come with more strings than a bank loan, but could also be done more quickly and bring expertise.

 

  1. Alternative lending – A whole slew of options are available, including peer to peer funding, invoice financing and leases.

 

Harold Duckworth can help get your business ready to make an application. We can undertake business planning, financial modelling and forecasting.  Get in touch with us on 01752 665134 or email us at info@haroldduckworth.co.uk to arrange a free consultation.

Our expert team provides a range of accountancy services including bookkeeping, payroll, tax returns and company audits.

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