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Finance for hospitality: 3 ways you can boost your cashflow during Covid times
Finance options can help you cater for recovery. Every catering and hospitality business owner is now re-examining their plans in response to the COVID-19 pandemic, particularly in terms of how strongly they’ll be able to bounce back. Commercial Director of Propel Finance Group Plc, Jon Maycock, gives his top three ways to boost cashflow during this challenging time.
When you’re addressing the steps towards recovery, remember ‘Turnover is vanity, profit is sanity, but cashflow is king’. Accessing the right options has never been more critical. Consider enlisting the services of a trusted adviser such as your accountant to help you weigh up the funding options that will help you drive your business forward. Always ensure that you’re able to keep up with the necessary future payments.
These three finance options can help you through an unpredictable time:
1. Renew equipment
Asset finance (leasing and hire purchase) gives hospitality businesses access to the latest equipment to increase productivity and efficiency, without tying up capital.
There are also many providers of secured and unsecured loans in the market, ranging from high street banks, new ‘challenger’ banks, online lenders and local specialists, offering a wide range of interest rates. Some of these will require personal guarantees.
2. Release value in your business
Asset refinance frees the cash tied up in your existing business assets such as equipment. It can be an effective way to unlock cash to invest in business growth. Invoice finance (factoring and invoice discounting) unlocks a high percentage of the value of your unpaid invoices, releasing working capital. With a merchant cash advance, you could also receive a cash injection based on a small percentage of your customer card sales.
3. Boost your cash with a government loan
The Coronavirus Business Interruption Loan Scheme (CBILS) is designed to support the continued provision of finance to smaller UK businesses. It allows lenders to provide facilities of up to £5 million to businesses that are experiencing lost or deferred revenues, leading to disruptions to their cash flow. Hospitality is at the heart of this.
For more information, contact Propel Finance Plc on 01633 982960, or email: contact@propelfinance.co.uk
Always refer to the government website for the most up-to-date information.
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