Smoothing the way with more than just finance.
Neeta decided to set up a paper export business after finishing her MBA course. Coming from a family with well-established business credentials, she had forged strong relationships in the paper industry and had good connections in India – her family’s home before settling in the UK.
With sound experience of business and good knowledge of the international market, she was able to agree an export contract with a major paper user in India with the product sourced in Canada via a UK intermediary.
The problem was that, as a new start business, Neeta was not able to attract credit terms from the supplier who needed payment when the goods were dispatched from the Canadian factory.
WCP obtained credit insurance on the Indian buyer and arranged a local verification and collection service. We then paid the Canadian supplier for the goods which were shipped directly to the port in India.
The Indian customer agreed that they would pay 60 days from the date the goods landed; so the trade finance was converted to invoice finance at that point, with WCP’s local partner making sure that payment was made in full and on time.
Neeta was able to complete a transaction which would otherwise have involved considerable risk and required significant amounts of working capital. And of course, without the worry of financing, she was immediately able to start work on opening up other export lines to India and countries in the Middle East.
“All the staff are very helpful and expert in their subject. It gives an extra advantage to your business.”
Selective Invoice Finance
Seeing turnover double within twelve months!
Kenny’s company offered a wide range of industrial and commercial electrical services: everything from installation, maintenance and instrumentation… to motor repair, overhaul and inspection.
They established in 2012 by purchasing a failing business for turnaround. While there was already an invoice finance facility in place, there was a problem: the invoice finance company was not sticking to their side of the agreement.
Kenny’s company needed an effective solution to be able to grow… so they turned to the banks for additional support.
After seeing a great deal of time and energy wasted on false promises, Kenny was directed to Working Capital Partners by their accountants and a funding solution was quickly organised.
With a straightforward invoice finance arrangement in place, Kenny and his directors were able to get back on track and start planning for growth again.
Apart from the number of employees growing to 40 (it was 14), there are also ambitious growth plans in place for 2016; these span a wide range of commercial and industrial sectors.
We have doubled the turnover in the last 12 months and grown the workforce on the back of the help provided to us by Working Capital Partners. We could not have achieved this without their assistance.
The facility is simple to use and they have delivered everything they promised. The signs are encouraging for 2016 and we have the comfort of knowing that WCP is there when we need them.”
Cashflow and credit solution boosts growth for small business retailer.
Janet runs a small wholesale business and was also building up an internet site selling hair accessories.
As the business grew she found she needed to increase the amount of stock she carried so that she could offer the instant deliveries demanded by her customers. But her suppliers would only give her limited credit lines and as a result she very quickly found herself running out of money.
Because many of her wholesale customers were very small businesses themselves, she couldn’t get adequate credit limits on them and so factoring her invoices was not an option.
With our SME Tradeflow solution Janet was able to take goods from suppliers and pay for them on delivery.
This enabled her to take advantage of prompt settlement discounts, which were often enough to cover the cost of the SME Tradeflow fees.
In addition she was able to make bulk purchases which further reduced her costs.
Janet was delighted:
“Without the help of WCP, my business growth would have been a lot slower. They are great at finding simple solutions to complex challenges”
Working with WCP, Janet was able to finance her wholesale business at very low cost and provide the delivery speeds she needed in order to compete in the internet age.
Trade and Import Finance
Rapid growth can cause cashflow issues.
Jay started his car parts business with a clear idea of his proposition – to reduce the cost of certified spares. This he did by manufacturing in China, while ensuring a high-quality product. Over the following two years, the business boomed and the orders came flooding in. However, expanded stock levels meant a serious drain on capital and cash flow.
So, by year three, cash flow was his main concern.
For, even though Jay had orders aplenty, a large pool of satisfied customers and an excellent track record, he couldn’t grow the business for one good reason. There simply wasn’t enough cash in the business.
During a regular review with his Bank Relationship Manager, Jay was told that factoring was an ideal solution. Unfortunately, the bank’s couldn’t offer Jay such a facility as his company didn’t meet their criteria.
Despite rapid growth, his turnover was still below their minimum volume threshold. They also wanted a longer trading track record and, because much of Jay’s business was concentrated with a few significant customers, it would breach their lending guidelines.
Thankfully, the Bank’s Relationship Manager had heard of Working Capital Partners and suggested that Jay approach us. Working with his accountants, we constructed a deal which allowed him to continue growing his business using his receivables to finance its expansion.
What’s happened since is best described by Jay himself:
“The Business is growing fast and – with WCP’s help – I am in an excellent position to exploit the market and create a real nice for my business.”