MORE than a quarter of UK manufacturers and half of wholesale and distribution firms have cited that difficulty in accessing funding is the main barrier to sustainable growth.
These findings have been drawn from the Close Brothers Business Barometer, a quarterly survey that gauges opinion on a number of financial issues from small and medium sized firms across the UK.
It also showed that 13 per cent of manufacturers and 30 per cent of wholesale and distribution businesses have been declined access to finance over the past six months.
Jeremy Spooner, National Sales Manager of the Materials Handling division of Close Brothers Asset Finance said: “Manufacturers and indeed the entire supply chain is experiencing challenges on a number of fronts. Issues such as rising costs of raw materials, sky-high fuel costs and increasing pressures to meet a green agenda culminate to result in a sector that is fairly cash strapped.
“In addition, a number of firms haven’t been able to access appropriate funding and you can see that there is a real problem. Small profit margins are damaging cash flow and this has serious repercussions on a firm’s ability to maximise opportunities for growth,” he added.
The Business Barometer also revealed that 15 per cent of manufacturing companies who hadn’t approached their bank for finance said it was because they were worried they’d be turned down or that their existing overdraft limit would be reduced.
Jeremy said: “Despite the large number of business owners that say they’re finding it difficult to access funding, a third told us they haven’t considered using asset finance to bridge this gap.
“This is why we’re working hard to educate the sector on this innovative form of finance that supports business growth. We offer three key products; leasing hire purchase and in particular, asset refinancing.
“Companies often don’t realise how much cash might be ‘hidden’ in their existing assets and that’s where we can help; we can tailor a refinance package that will help unlock that potential and provide a boost to working capital.
“When constructing a deal we’ll take into consideration a variety of factors including the value of the asset, how mission critical it is to the business as well as company financials.
“It’s an option worth serious consideration. Accessing finance will continue to be an area of concern for many business owners in the medium term, but there are smart ways to raise finance.
The Materials Handling division of Close Brothers Asset Finance will be exhibiting at the IMHX expo in March. To find out more contact 01244 853440.
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