Asset Finance
These are business loans which allow the clients to purchase business assets like plants and equipment,machinery,vehicles, and other business-related assets. It can allow clients to release equity from the assets that they already own viz-a-viz a truck that they ownand enable them to buy a new asset by using the existing asset as security.
We get enquiries for assets ranging from trucks and business vehicles to heavy machinery for forestry or diggers and cranes. Our clients in the medical profession borrow to purchase health equipment while those in the hospitality industry buy furnace and ovens. Clients in the beauty industry have borrowed to purchase laser equipment.
We have relationships with several different asset finance companies, and they all have their niche areas and businesses that they like to operate in. Based on their expertise and comfort, the borrowing terms and interest rates can vary from one lender to the other. It is therefore a good idea to have a no cost chat with us first so we can understand your needs and suggest how we may be able to assist you.
We can also structure a finance solution to best suit your needs. For instance, you may have a seasonal work pressure and want a line of credit for a few months, or you may want a lender who offers the flexibility to pay the loan faster with no penalty. We can address these issues with you so the solution that we create is fit for purpose.
We have assisted our clients to refinance their loan and reduce their interest cost while some have wanted a structure with less upfront payment and a bigger balloon payment at the end to assist with the initial setup cost.
Some key reasons for asset finance are:
- Free up your business cashflow: Asset finance can allow you to avoid using your own funds or eating into your cashflow. You can have the ability to pay them off slowly as the business grows.
- Capital Release: Instead of putting your personal cash or borrowing on other assets like home loan, you can release capital by refinancing the assets that the business already owns. For instance, you may have a debt free courier van and you wish to purchase another van as the business is growing. You can borrow sufficient funds to put as the deposit for the next vanon your debt free vehicle.
- Business growth: If your business is going through a growth phase then it will be always hungry for more financial input to support the growth. For example, if you are adding more vehicles to your trucking business or a high-endUltrasound machine to your radiology. Based on your business’ past performance we may be able to assist you with new lending to support this growth.
- Flexibility of loan repayments: We can structure your loan so you can pay it off faster with little to no penalty. We can also search for competitive rates so you can be assured that you are not paying too much for the loan. We can increase the loan term if you wish to stretch the loan to improve your cashflow.
- New or Old asset– Sometimes buying an old asset will not only save you money but it can save the business by allowing you to operate without a huge hit to the cashflow. Our industry experience, knowledge and expertise while working with similar clients over the years can be beneficial to you. It can guide you to consider these factors and reduce your cost.
What have our clients used the Asset finance for:
- To purchase truck as an owner operator driver and for their staff
- To purchase additional vehicles for their staff to drive, like courier vans
- To buy coffee machines, ovens, for their café
- Ultrasound and other health industry machines
- Heavy earth moving machines like diggers, excavators
- Manufacturing machines including CNC
- Utes and cars
Key tips to improve your cashflow:
- Invoice quickly– Send your clients an invoice quickly so they know that they must pay for the items soon after they have purchased the goods or service. They will get 7,14 or 28 days to pay it, but they are aware of it immediately.
- Offer clients different ways to pay – Gone are the days of cash or cheque. In fact, neither of the two is easy for modern day customers. Usinga credit card, online payment link, phone payment methods like Payclip and mobile EFTPOS can be the difference between getting paid immediately and not being paid at all.
- Looking at your accounts regularly– See where and how you are spending money and what your clients are buying. No point purchasing summer clothing in winters and holding on to it because you may get a discount on it if the next winter style can influence the sale of your clothes.
- Have a good accounting system– Like XERO, that can not only make a lot of accounting easy for you and save on huge accounting bills. It can also paint a picture of your income and expenditure or compare this quarter or year with the previous ones.
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