Unlocking Funding for Small Businesses: A Guide for Clients of OutsourceCloud

Introduction

As a small business owner, accessing the right funding at the right time can be the difference between surviving and thriving. That’s why OutsourceCloud has partnered with Nexus to bring tailored funding solutions directly to our clients.

Whether you’re managing cash flow, investing in equipment, or planning to expand, there may be flexible financial options available to support you. Below, we break down the types of business finance on offer and how OutsourceCloud can guide you through the process.

What’s Available Through the Nexus Partnership?

Thanks to Nexus’s access to over 150 lenders from high street banks to specialist providers there’s a wide range of funding products available. Here’s a breakdown of the key types, plus how they could support your business.

1. Asset Finance

Need new equipment, vehicles or machinery but want to avoid a big upfront cost?

Asset finance allows you to spread the cost over time. You get the tools you need, while keeping your working capital free for other priorities.

Whether you’re an established company aiming to upgrade equipment, a growing business looking to expand your fleet, or a start-up needing essential assets with minimal upfront costs, there could be a tailored solution for you.

A use case example:
A growing plumbing business needs three new vans. Instead of dipping into their emergency reserves, they use hire purchase and pay monthly over 24 months.

Types of Asset Finance:

Hire Purchase: This option enables your business to purchase new assets by utilising the asset being acquired as collateral for the loan. You own the asset at the end of the agreement.
Asset Leasing: Use the asset short-term without owning it. This eases cash flow since there’s no
need for a significant upfront payment
Stocking Finance: Ideal for businesses that need and sell high-value stock, such as car
dealers. Stocking finance helps avoid having all your cash tied up in
stock, providing the flexibility to manage inventory effectively.

Is Asset Finance Right for Your Business?

Asset finance is suitable for a wide range of businesses including:

Start-ups: Needing essential assets with minimal initial expenditure.
Growing Businesses: Looking to expand operations without depleting cash reserves.
Established Companies: Seeking to upgrade or replace outdated equipment efficiently.

2. Invoice Finance

Do you wait 30, 60 or even 90 days for clients to pay? This ties up money that could otherwise be helping you grow.

Invoice finance unlocks capital tied up in unpaid invoices. Lenders advance up to 90% of what you’re owed, on a rolling basis, much like an overdraft then collect from your client or let you do so confidentially.

This quick access to funds can be a lifeline for businesses facing cash flow issues, as it allows them to cover day-to-day expenses such as payroll, inventory, or expansion plans without waiting for customers to settle their bills.

A big advantage is unlike traditional loans, invoice finance uses the unpaid invoices as collateral, meaning businesses do not usually need to provide additional security.

Key Types of Invoice Finance:

Selective Invoice Finance: Choose which invoices to finance.
Factoring: Lender manages collections.
Confidential Discounting: You stay in control of the customer relationship.

Benefits of Invoice Finance:

Quick Access to Funds: Funds can often be accessed within 24 to 48 hours of submitting an invoice, providing a much quicker solution compared to traditional loans or overdrafts
Improved Cash Flow: By unlocking cash tied up in unpaid invoices, businesses can maintain a healthy cash flow, ensuring they can meet financial obligations, invest in growth, and operate without disruptions.
Scalability: The amount of funding available grows in line with the business’s sales, making invoice finance a scalable solution that adapts to business growth. As a company’s turnover increases, so does the potential funding.
No Additional Collateral Required: Since the unpaid invoices serve as collateral, businesses do not need to provide additional assets to secure the funding. This is particularly beneficial for companies with limited physical assets.

3. VAT & HMRC Finance: Managing Tax Obligations with Flexibility

Worried about making a big tax payment?

Finance options are available to spread your VAT, self-assessment, or corporation tax bills over several months, reducing the strain on your cash flow and helping you avoid HMRC penalties.

Use case example:
A hospitality business faces a large VAT bill after a strong summer. Instead of dipping into cash reserves during a quieter winter, they spread the VAT over six months.

Types of VAT & HMRC finances available:

VAT Loans: Smooth out your quarterly VAT bills with our tailored short-term loans. We’ll handle the payments to HMRC, and you can repay us in manageable monthly instalments over 3-12 months.
VAT Bridging Loans: Useful in property deals.
Corporation Tax Loans: Spread the cost of your annual corporation tax over 3-12 months with our flexible financing. Preserve your working capital for operational needs while staying on top of your tax responsibilities.
Revenue Based Financing: Borrow funds and repay with a percentage of your monthly revenue. This flexible approach is ideal if your cash flow fluctuates, as your repayments will rise and fall with your business performance.

Some of the benefits of having this type of finance includes:

Avoidance of Penalties: Ensuring timely tax payments through financing options helps businesses avoid late payment penalties and maintain good standing with HMRC.
No Personal Guarantees Required: Many HMRC financing options do not require personal guarantees, reducing the risk to business owners.
Opportunity for Growth: Freed-up capital can be reinvested into the business, such as hiring new staff, purchasing inventory, or expanding operations, potentially leading to increased profits that outweigh the cost of financing.
Improved Cash Flow Management: By converting large, infrequent tax payments into smaller, regular instalments, businesses can better manage their cash flow and allocate funds to other critical areas.

4. Property Finance

Looking to buy or develop commercial property?

Whether you’re purchasing office space, renovating a warehouse, or refinancing an existing mortgage, property finance can help.

Options include:

Commercial Mortgages: Long-term loans for real estate.
Bridging Loans: Short-term finance to bridge purchase and sale.
Development Finance: Covers building or refurbishment costs.

5. Merchant & E-commerce Finance

Run an online shop or use a card reader in-store?

This solution offers a cash advance based on future sales, repaid as a percentage of your takings so you pay more when sales are strong and less during quiet spells.

Ideal for:

E-commerce businesses
Retailers with card readers
Seasonal shops needing flexible repayment terms

Key features:

Rapid Access to Funds: Businesses can receive funding quickly, often within 24 to 48 hours, enabling them to seize opportunities or address urgent financial needs.
Flexible Repayment: Repayments are typically structured as a percentage of daily sales, ensuring that businesses pay more when sales are high and less during slower periods.
No Fixed Monthly Payments: The repayment model adjusts with your sales volume, providing relief during off-peak seasons or unexpected downturns.
No Collateral Required: Since the funding is based on future sales, businesses often do not need to provide additional assets as security.

Help for Business Owners: What To Do Next

OutsourceCloud remains your go-to advisor throughout the process. We’ll help assess your business needs and introduce you to the Nexus team if funding seems appropriate. They’ll explore your options in more detail, without obligation or upfront costs.

Let’s Explore What’s Possible

You don’t have to figure this out alone. Whether it’s funding, tax planning or financial strategy, OutsourceCloud provides end-to-end accountancy support and can help you weigh up your options.

If you’d like to understand what’s available or talk through your situation, just reach out for a chat.