Pressure on proceeds

Some of the most prolific restaurants in the UK have agreed on rescue plans with lenders due to recent food and ingredient costs increasing, which is causing pressure within the industry. This is due to the slide in the British pound since Britain’s vote to leave the EU and in addition to these issues, businesses are struggling with rent increases.

 

Burden on existing resources

The effect of Brexit has been felt by catering businesses in the UK, with figures from a recent report from the Office for National Statistics showing that net migration from the EU has fallen to its lowest in 10 years.  With over half of the hospitality workforce being represented by EU nationals, some business owners are raising the salaries of their employees to keep them on board, with research showing an average salary raise of 8.5%, compared to their British counterparts who have seen their pay fall by 3.4%.  Businesses are finding that they are neglecting to replace or purchase vital equipment due to these extra pressures, although these items are essential for the growth and maintenance of a commercial kitchen.

 

Difficulty for start-up financing from banks

If you are just beginning your catering business, you can find that there is a lack of understanding from classic lending sources.  Business owners found have that banks can take up to six weeks to decide, which could be refusal with unclear reasons why.  Despite this, there has been huge growth within the sector, as asset finance has been lending money to new start-ups which enables them to hire and purchase all kinds of manufacturing and processing facilities to help get them onto their feet.  This kind of finance has been a great support to all sorts of businesses within the industry.

 

Daunting prices of quality equipment

Budgeting for highly expensive equipment, considering your restaurant objectives, and the features needed can be a concerning task.  Some business owners will end up purchasing cheap appliances and will need to deal with regular maintenance or early replacement.  Lower quality equipment may be less energy effective, meaning that there will be the cost of higher power consumption to consider.

 

Money already tied up in existing assets

Equipment, vehicles and machinery already owned can be used to release cash, by means of refinancing.  Using existing equity, money can be borrowed and secured against an existing asset.  This can allow for an amount of cash to be unlocked and spent on whatever you require.

 

The need to stay ahead of the game

Trends in the culinary world are constantly evolving, and this has a direct impact on the equipment being used in some of the most innovative kitchens.  Not only is this about obtaining quality equipment, but it is also about the need to stay competitive.  Keeping up with the changes within the food industry is key.  2019 has seen trends in space-saving and multifunctional equipment – largely due to shrinking kitchen space -, Bluetooth enabled appliances, nitro gas equipment and lightweight catering transport equipment.  Asset finance can provide the latest tools that you need to stay competitive.

To discuss your asset finance requirements, call us today on 01213 122 727.