Business start-ups increase and in need of invoice factoring

The number of business start-ups across the UK has risen for the first time in over 18 months according to a recent Royal Mail study.

In the last 6 months alone, just under 40,000 new businesses had been set up in the UK which has bolstered the total number of UK businesses (small and large) by some 13%

The Franchise Development Services (FDS) who oversee franchise operations in the UK also reported a turnaround in their recent study, indicating that the UK economy could be getting some much needed support from the private sector, in the wake of the UK governments’ austerity measures.

The FDS study indicated there are some 1,500 or so established franchise brands currently operating across the UK, and that new franchise enquiries had been received from more than 250,000 people whom are believed to be considering setting up their own franchise businesses in the immediate future. The report also highlighted that as a result of UK activity, so far this year; another 150 new franchisers have entered the UK market and are open for business.

Self-employment, starting a new business and/or opening up a franchise business have historically seen an increase after recession, not only due to perceived confidence in a growing economy, but out of circumstance and necessity, as many who were made redundant during the downturn look to make their own luck in a distressed job market.

Whilst many of these new business owners will have used personal savings and redundancy payments to launch their new company, with traditional bank borrowing such as overdrafts being elusive, many start-ups are taking advantage of the availability and flexibility of invoice finance.

The surge in start-up activity is encouraging, but as cash flow is still the biggest killer of businesses, new and old, often as a result of late payments; it makes sense to many new businesses to put in place, such a commercial finance facility as soon as possible.

With invoice finance, the finance provider not only advances funds secured on the sales ledger (and not the business owners’ personal property) but offers varying levels of support and additional products to assist the small business finance needs and offer protection against bad debts.

As many of the new start-ups during the last 6 months have come from people with no prior business ownership experience, having the professional credit management skills and commercial knowledge that comes with a factoring provider can mean the difference between survival and failure

If you would like to look at ways of raising small business finance such as bridging loans and commercial mortgages to invoice finance facilities such as factoring and invoice discounting, then please get in touch for a no obligation discussion or use our ‘am I eligible’ feature and we will start looking for the most suitable finance facility from our independent UK wide broker network.

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