Industry: Wholesale and distribution
Product: Invoice factoring with bad debt protection and GGS top up
Facility size: £420,000
The client
This business is the principal European partner and distributor for an American food smoker brand. Having started in the UK in 2000, today they sell meat smokers and other barbeque accessories into 26 countries.
The opportunity
With the sector being seasonal and spring and summer being their busy seasons, the company has used invoice finance as a tool for managing cash flow.
Doing this gives the small team the freedom to run and grow the business without spending time chasing late customer payments, which the provider undertakes on their behalf. The factoring facility releases up to 90% of unpaid invoices, ensuring availability of capital during longer payment terms or late payments.
The incumbent provider was exiting the market, and the firm needed an alternative solution quickly to ensure there was no impact on the day-to-day operations.
As the wholesaler grows their presence across Europe, they’re increasingly exposed to the risks of working with unfamiliar customers. To maintain confidence and help create financial stability, they need stronger safeguards for new business relationships.
The solution
Close Brothers has provided a £400,000 invoice factoring solution with an additional top-up through the Growth Guarantee Scheme (GGS). This supports access to finance for UK small businesses as they look to invest and grow. The GGS provides a government-backed guarantee, ensuring that companies can secure the funding to expand operations without undue risk.
Alongside the facility, Close Brothers provide bad debt protection, a product that can be added to your invoice discounting or factoring facility that ensures that you still receive payment in the event that your customer can’t settle their invoices.
The result
The smooth transition to Close Brothers’ invoice factoring has allowed the firm to continue operating without interruption. This has not only supported financial stability but also positioned them for sustained growth in new markets.
The business has successfully expanded their reach across Europe, using the additional headroom provided by the GGS top-up to hire staff. They can now confidently explore new opportunities, with improved levels of working capital and bad debt protection in place.
