One of the biggest challenges facing workshop owners is freeing up cash for investment in capital equipment. According to Lee Schofield, Sales Director at PMD Business Finance, the key is to secure a financial arrangement that allows you to pay off the cost in monthly instalments.
PMD Business Finance works with many well-known equipment specialists in the industry, including MAHA, Digraph and TotalKare, to provide workshops with a viable method of financing those big ticket items.
Freeing up cash to invest in potentially profit-making equipment is not easy. Lee Schofield, Sales Director at PMD, has a number of suggestions to tackle the issue: “Big money investments are costly and can easily branch into hundreds of thousands of pounds. The very nature of this sector typically means that cash flow is a challenge due to credit terms and payments. Therefore, workshops won’t usually be awash with cash, so it makes sense for any investment to be paid for as it generates a profit for the business.
“You wouldn’t take on a new employee and pay them a lump sum, so why would you do that with new equipment? The best way is to pay for the equipment as it operates in the business – on a monthly basis.”
Capital items in workshops, including ATF lanes, diagnostic equipment, spray booth facilities, vehicle lifts, brake testers, air con testing and welding equipment are all financeable. The trick is finding the right finance partner. Lee continued, “Many workshop owners we work with will also be running their own vehicle fleets, which we can also finance. In fact, that is what brought us into the commercial vehicle sector in the first place. Now that we’ve been working within the sector for many years, we have catered for brand new start- up businesses, as well as major operators. Due to this experience, we know exactly what challenges those in the sector are facing, and we use our expertise and knowledge of the industry to support them.
“Banks can’t offer the right options, and the process is typically long-winded and time consuming. Therefore, whether you are buying a one-off, expensive piece of equipment, or you are investing in a brand new fleet of vehicles, it is crucial to work with a funding partner that knows your industry. For example, at PMD, we have aligned ourselves to a funding panel that has an appetite to grow its portfolio in the transport sector. We now have 63 asset finance providers on our books, meaning we can provide numerous credit lines, allowing you to purchase multiple items of equipment from different suppliers.
“As a firm, we are lending in excess of £100million each year and this level of volume means we get the most favourable rates from our funding partners, allowing us to pass these savings on to our clients. As a finance partner, we can finance any asset, from lifts to new vehicles and everything in-between.”
Lee added, “Our aim is to communicate that there are a number of different finance options available that aren’t restrictive, and this is particularly important for haulage firms and workshops, because working with a partner that understands your opportunities and challenges will make the entire process much more straightforward. Therefore, accessing alternative finance means growth is more realistic and potential expansion is quicker.”