Financing Specialised Equipment can be a challenge particularly where a business does “not tick all the boxes” from a clinical credit perspective.
Business by its very nature is dynamic. As many business owners know there are ups and downs!
Often the pathway to success is littered with potholes! Making it difficult for business owners to access the finance they need!
For example, we were recently engaged by a client to assist with financing some specialised equipment:
The Challenge Presented
- Highly Specialised Equipment
- Business highly geared
- Premises leased not owned
- No additional security available
- Reliant on future cashflow
- 100% financing required
- Limited lender appetite
The Road to a Good Customer Outcome
Strategy
Given challenging elements involved workshopped the proposal with The 500 Group team members to formulate a solution
Financial Projections
Sought detailed Accountant prepared Financial Forecasts linked to Balance Sheet and Profit and Loss
Contract
Advised client a watertight contract between them and their client would be needed to provide Lenders comfort
Financial Projections
Prepared a detailed Finance Proposal for presentation to Lenders
Negotiating the Solution
Given the nature of the transaction, we reviewed our panel of Specialist Lenders and selected those we felt most suited to this type of financing.
We then met Credit to determine their appetite and to understand what was needed to allow their participation.
Negotiations extended over a number of meetings with elements of the initial Proposal refined.
A Good Customer Outcome Achieved!
- Financiers recognised the value of the underlying future cashflow of the business
- Clients were able to acquire the Specialised Equipment needed for future operations
- Five year, 100% cashflow financing obtained
- Directors guarantees provided
Summary
This was far from a straight forward transaction but is a great example of what can be achieved when Lenders, Brokers and Business Owners, work together to find a solution to a financing need.
Being able to meet and negotiate directly with the Lenders Credit Personnel to understand their appetite and concerns was critical to the outcome we were able to achieve.
If you have an Equipment Finance need and would to discuss how The 500 Group may be able to assist, don’t hesitate to give me a call on 0433 210 353.
