After forced closure , Electrical Contracters able to start again by using Invoice Finance

  • Anil Kanda
  • 24 Jun, 2014

An Electrical contracting businesses came into difficulty when one of their customers -who contributed to 80% of their turnover-went through a major restructure and stopped paying all suppliers for over a 3 month period.

After 7 years of successful trading, the company could no longer afford to keep its doors open, and with insolvency advice, was forced to close for good. However, in February 2014, after a few months of preparation, planning and business development they started up again under a new name and they acquired a larger volume and wider spread of customers.

Though the business was getting back on to its feet again, they were still struggling to bridge the gaps in cash flow as most of their customers paid their invoices with in 30- 60 days. To deal with the higher volume of customers, the directors desperately needed two new vans, and also needed to quickly generate capital as they were struggling to meet supplier payment deadlines and pay staff wages .

Though business was coming through the door, the directors needed to urgently regulate their cash flow. They approached their bank, which was unable to help so their independent advisor referred them to Ashley Commercial Finance. After speaking with a Regional Sales Director it was made clear that they needed the funding fast! Within 4 days Ashley managed to put a Confidential Invoice Finance facility in place with a £35k funding limit, and  paid an upfront £10k that was released on the day they signed up to the facility.

Now, rather than waiting up to 60 days for payment, The business can  now unlock the cash upfront from their unpaid sales invoices  and as it is confidential their new customers and  suppliers  do not know there is a financial facility in place.