Invoice Finance for SMEs in the Engineering & Maintenance Industry

SMEs in the Engineering & Maintenance Industry: Invoice Finance as an Option to Ensure Long Term Growth

SMEs in the engineering and maintenance industry often reach a point where they need to grow their business in order to meet increased customer demand, but don’t have the available cash flow to do so. This causes a lot of financial and operational pains for the business.

Growing in the engineering and maintenance industry is a tough one for small businesses. With increased customer demand, many SMEs reach the breaking point where they need more money but don’t have it available on the horizon or even within budgeting constraints given tight financials.

Invoice finance can be an excellent option for these businesses, as it allows them to access money against outstanding invoices. This can help to ensure that your business has the resources it needs to grow and fulfil customer needs.

In this article, we will discuss invoice finance as an option for businesses that find themselves in this situation.

Don’t Let Cash Flow Hinder Your Business Growth

Growing your company is a challenging and rewarding process but growing can be painful. Very painful. Making sure that your cash flow can meet your obligations as you take on more staff, bigger premises, more stock, or new equipment is a challenge. It doesn’t matter how well established your company is, if you don’t have a handle on your cash flow then you won’t survive the growth spurt.

As you expand your business increased costs and financial strains start to appear. You may have a stable cash flow at first, but very soon that additional financial strain starts to creep in.

Financial issues Affecting Business Growth

There can be several reasons why a business will experience financial operational pains. These issues can come from:

Credit limit reached by current provider: When a small business reaches its credit limit with its current provider, they are then restricted in growing the business as more cash flow is required than the current provider can release. Businesses in this situation then need to look into a UK Accredited Funder that has the funding available to support the business growth.

Unpaid Invoices: A business that is struggling to get its invoices paid in a timely manner will find itself in a difficult financial situation as they are likely to have more outgoing expenses than capital coming into the business. This can become a real issue if there is one particular large debtor for which the business relies on their payment. Any form of overdue payment from clients puts significant pressure on the business.

But even when invoices are paid on time the need to give your customers credit terms can create a funding gap.

Credit Control: Many small businesses find credit control to be a daily struggle. From raising invoices to chasing for payment and reconciling accounts. Employing the services of a fully outsourced credit control facility will enable a business to concentrate on the actual business needs and growth without constantly trying to fit in time for productive credit control.

What’s the answer?

As a company owner who’s looking to expand your business, take on more staff or purchase new equipment, invoice financing is the answer for you. Invoice finance can help make sure that your cash flow is managed and at Partnership Invoice Finance this is specifically aimed at small and medium-sized businesses.

Factoring is an alternative form of finance that allows your company to access cash sooner than waiting for payment from customers. It’s a service that grows with you; a method to manage your cash flow and cut down the time strain of collecting payments yourself. It’s like having an additional financial department and safety net. As you grow your business, it keeps pace with your needs and will help support growth.

The truth about factoring is, it’s a wise choice for a growing business and is ideal for small-medium businesses selling to other businesses on credit terms.

  • Factoring provides access to cash without the business having to sell inventory or other assets to pay urgent bills at a time or price that may not be right.
  • Factoring is a far more flexible option than traditional borrowing- providing finance that grows as you do.
  • You don’t have to provide additional personal collateral for factoring, which is often required when you take out loans from banks and other financial institutions.
  • Application process and sanction for factoring with Partnership is quicker than the Bank- usually, a facility is agreed within 48 hours with the first drawdown of cash to you shortly after.
  • Factoring is an efficient and flexible way of borrowing money.

Factoring gives you access to the value of invoices before they are paid-typically within 48 hours of raising them and whilst most businesses have their whole turnover funded, you can elect to choose which customers your business would like to factor. The financier then provides the funding and manages every aspect of your credit control saving you time and money.

Growth never sleeps – make sure your cash flow can keep up! To learn more about the benefits of invoice finance and how our experienced team at Partnership Invoice Finance can help, please contact us.