Funding for a Manufacturing Business
From premises and machinery to materials and ongoing production costs, running a manufacturing business requires investment at every stage.
With around 250,000 manufacturing businesses in the UK, many face the ongoing challenge of the costs involved in producing, storing and selling their products. For some, accessing the right finance can provide the capital needed to maintain operations, increase production capacity or invest in the next stage of growth.
Financing a Manufacturing Business: How Upfront Costs Can Become a Barrier to Growth:
Starting a manufacturing business can require a significant amount of capital before the first product is even made. From securing premises and purchasing machinery to sourcing materials and hiring staff, these upfront costs can quickly add up.
For a new business, this can create a difficult position: investment is needed to start producing and generating revenue, but there may be limited cash available to cover these initial costs. External finance can provide valuable support, giving new manufacturers the capital the need to get their business off the ground.
However, finding the right finance to cover these costs is not always straightforward, particularly for businesses with limited trading history or assets.
Barriers to Finance
With stricter lending criteria presenting a barrier for some manufacturing businesses, accessing finance isn’t always straightforward. A report produced by Make UK demonstrated that 14% of manufacturers found stringent eligibility criteria as a challenge when accessing finance and a further 8% said that they found the funding application process too complicated presenting another barrier to finance.
For newer manufacturing businesses, limited trading history and significant upfront investment in machinery, premises and materials can add further complexity. But accessing finance doesn’t have to mean the end of the journey when it comes to securing finance.
How Let’s Do Business Finance Has Helped Manufacturing Businesses Access Business Finance:
At Let’s Do Business Finance, our human-led approach to lending means that we take the time to understand the full picture including your individual circumstances and where you want your business to go. We look beyond the numbers to understand the wider business journey. Rather than just relying on algorithms, we work with you to find the right business loan for you and your business.
With this approach, we offer several finance options to support manufacturing businesses at different stages of their journey:
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Eligible new and early-stage manufacturers could access up to £25,000 through a Start Up Loan. Funding can help initial costs such as machinery, equipment, materials and premises to help businesses get up and running. As an Official Business Support Partner of The Start Up Loan Company, we can support you throughout the application process
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For established businesses, we offer businesses loans of up to £250,000 to support investment, manage cash flow and unlock new opportunities. Whether its upgrading machinery, increasing production or bringing new plans to life, finance could help take your business to the next level.
From getting started and investing in production to managing cash flow and supporting growth, we’ve helped businesses access finance to move their plans forward.
Here are some of the manufacturing businesses we’ve supported:
AYM: Funding Growth and Increasing Production Capacity
Always your moment is a womenswear brand based in Lewes, East Sussex, founded by Alie Machintosh.
As the business grew and demand for its ethically made clothing increased, AYM needed additional funding to support its next stage of growth. Let’s Do Business Finance provided a £70,000 loan which was used to implement a new stock management system and recruit a new seamstress. This helped AYM increase production capacity and continue growing while maintaining its focus on ethical and sustainable manufacturing.
““Financial support is vital in making ambitions tangible. It’s hard to know where to find that support and how to manage it well but raising investment through selling equity isn’t the only way to finance a business. Securing finance allowed me to maintain ownership in my business and showed me the opportunities that are out there.” ”
Quality Bottles – Scaling a Sustainable Packaging Business.
Quality Bottles is a fast-growing supplier of high-quality glass bottles and jars for the essential oils, natural wellness, cosmetic and other specialist industries. Based in Manningtree, Essex, the business was experiencing rapid growth but needed additional working capital to invest in stock and keep pace with increasing demand.
Let’s Do Business Finance, supported by the Growth Guarantee Scheme from the British Business Bank, provided the finance Quality Bottles needed to place larger stock orders, improve cash flow and expand its warehouse capacity. The funding helped increase storage from around 100 pallets to over 260, while enabling the business to replace expensive short-term borrowing and continue investing in its growth.
“The Growth Guarantee Scheme has let us grow quicker than we would have done without it.”
For Quality Bottles, the finance provided crucial support at a pivotal stage of growth, enabling Rowland to invest in stock, infrastructure and people while building a more sustainable and scalable business. The company has since continued to grow, employing four local staff and fulfilling more than 1,000 orders in a recent 90-day period.
Supporting your manufacturing business
Manufacturing businesses can face significant costs when starting out, maintaining production or investing in growth. Finding the right finance can help businesses access the capital they need, whether that’s to purchase machinery, increase production, manage cash flow or take the next step in their growth.
As the examples of AYM and Quality Bottles show, every manufacturing business has different requirements. Whether you’re looking to get started, invest in new equipment, increase production or support your next stage of growth, we can help you explore the finance options available and find the right way forward.
Have plans for your manufacturing business ?
From getting started to thinking about growth, the right finance can help to turn your business into reality. Talk to our team today to explore your options and see how Let’s Do Business Group could support your next step.