With traditional sources of funding being squeezed right across the UK and Ireland, asset based lending (ABL) has emerged as a powerful source of finance for many companies. But what is ABL and how does it work?
Put simply, asset based lending is a fast, simple and tax efficient way to raise money against the value of existing assets owned by the business. Many people assume this means that you have to own your own factories or buildings, but ABL can actually be advanced on a rich mix of assets that can include:
· Stock – perfect for wholesale businesses or resellers, ABL can help you to raise cash based on the stockholding you have on a month-to-month basis. This effectively enables you to leverage the value tied up in stock and to enjoy a return months before you actually recoup the sale value.
· Plant and machinery – a great way to get essential investments working harder for your business. ABL has long been popular with printing firms and manufacturing and processing companies who have to invest huge sums in the latest equipment to maintain a competitive edge.
· Commercial vehicles – many service businesses - from IT and distribution to refuse and haulage - have significant capital tied up in vehicle fleets. A cost-efficient ABL deal can make a vital contribution direct to the bottom line.
· Property – any company that owns its own premises, be it office buildings, factories or warehousing, can look to ABL to generate immediate cash to fund growth or relieve cash flow challenges.
Is asset based finance the answer to you funding needs?
Of course each asset based lending deal is tailored to the precise needs of your business. Terms can be flexible and ABL deals can be tied in with other forms of invoice finance to generate cash quickly and efficiently.
If you would like to know more about how asset based lending could work for your business, visit the Close Brothers Invoice Finance website.
Put simply, asset based lending is a fast, simple and tax efficient way to raise money against the value of existing assets owned by the business. Many people assume this means that you have to own your own factories or buildings, but ABL can actually be advanced on a rich mix of assets that can include:
· Stock – perfect for wholesale businesses or resellers, ABL can help you to raise cash based on the stockholding you have on a month-to-month basis. This effectively enables you to leverage the value tied up in stock and to enjoy a return months before you actually recoup the sale value.
· Plant and machinery – a great way to get essential investments working harder for your business. ABL has long been popular with printing firms and manufacturing and processing companies who have to invest huge sums in the latest equipment to maintain a competitive edge.
· Commercial vehicles – many service businesses - from IT and distribution to refuse and haulage - have significant capital tied up in vehicle fleets. A cost-efficient ABL deal can make a vital contribution direct to the bottom line.
· Property – any company that owns its own premises, be it office buildings, factories or warehousing, can look to ABL to generate immediate cash to fund growth or relieve cash flow challenges.
Is asset based finance the answer to you funding needs?
Of course each asset based lending deal is tailored to the precise needs of your business. Terms can be flexible and ABL deals can be tied in with other forms of invoice finance to generate cash quickly and efficiently.
If you would like to know more about how asset based lending could work for your business, visit the Close Brothers Invoice Finance website.
