Business Leasing Grows As Bank Lending Dips Again in 2014

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Lending to businesses is down again according to the latest Bank of England report which indicates that lending to companies of all sizes fallen in the 3 months to February 2014, despite continuing pressure on banks to boost growth by investing more.  Net lending to UK firms fell by £500million over the quarter despite a small increase in February.

In total, lending was down by 2.1% in February year on year. Economists pointed to firms paying down debt and tapping into alternative sources of funding but expect businesses to take advantage increasingly of improving credit conditions to fund growth.

Small business groups raised concerns about the latest findings, while banks put the negative lending figures down to firms using large cash reserves to pay down their debts.

The Bank’s report said survey evidence indicates that pricing on loans to small and medium-sized businesses has remained “broadly unchanged” in recent months.

John Allan, national chairman of the Federation of Small Businesses (FSB), said this ” underlines the ongoing challenges small businesses face in accessing finance to meet their growth ambitions”.

He continued: “As the economy continues to gain momentum, ensuring small firms have access to finance is critical.”

At the same time, the Finance & Leasing Association (FLA) has pointed to the fact that new asset finance business has grown at the beginning of the year by 9% to almost £1.7 billion over the previous year. Expectations of new business growth in 2014 are particularly bullish. Nearly three-quarters of FLA members surveyed anticipated growth in new business this year, up from 54% in the previous survey last June.

Jeremy Hall, CEO of leading asset finance and leasing company WestWon, commented, “Asset finance continues to provide a lifeline for many businesses that wish to invest in business growth. As well as the tax, budgeting and flexibility advantages offered by leasing, businesses are also able to benefit from rapid decisions in principle and quick access to the funding they need compared to the typical process of securing a bank loan.”

The Bank of England quarterly publication presents the Bank’s assessment of the latest trends in lending to the UK economy. This report draws mainly on long-established official data sources, such as the existing monetary and financial statistics collected by the Bank that cover all monetary financial institutions, and other data collections established since the start of the financial crisis.

For more information about leasing for business please call WestWon on Tel: 01494 611 456 or download the essential guide to leasing – Financing Your Business Plans.

Why Leasing Can Give Warehousing And Distribution Companies The Competitive Edge

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The warehouse and distribution sector is a highly competitive market, so it is vital to optimise efficiency and keep costs low in order to deliver the best possible service to customers.

As any business grows, its requirements change and keeping up with the latest equipment or software can be an expensive challenge. As a result, leasing offers an excellent alternative to buying. With leasing, warehousing and distribution centre equipment can be added to or upgraded at any time during the lease period, so you will always have the option of having the most up-to-date and efficient equipment to ensure your business stays ahead of the game.

Unlike buying, leasing means you can pay as you use. After an initial payment, you can start benefiting from the equipment straight away and spread the cost over its useful life, so you can be paying for the asset with the income it generates.

Leasing can help improve your cash flow by keeping your working capital free. This leaves you with funds available to reinvest elsewhere in your business and you can take advantage of considerable tax benefits. With an operating lease, lease ‘rental’ payments are an allowable business expense that can be set against profit – thereby potentially reducing your tax bill. Other methods of equipment acquisition, such as outright purchase, do not have the same level of tax benefit.

What assets can be leased?

From a single item to an entire turnkey solution, almost any combination of tangible asset can be included in one lease agreement. Types of equipment that can be leased include:

  • Conveyor systems
  • Forklift trucks
  • Pallet lifts
  • Storage solutions
  • Warehouse Management Systems
  • Workbenches
  • Pallets and containers
  • Shelving systems
  • IT hardware and software
  • CCTV and security systems
  • Furniture

WestWon Limited has a wealth of experience in providing asset finance solutions for a wide range of equipment and industry sectors. For more information on leasing, download the free Essential Guide to Leasing for Business. Alternatively, please call us on Tel: 01494 611 456.

 

 

Can Refurbishing Your Office Environment Increase Productivity?

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Does your office environment affect productivity? The simple answer is yes. Creating a vibrant and positive office space can improve staff morale and efficiency as well as help you make the right impression on clients. What is more, it doesn’t have to mean a large capital outlay as businesses can finance an entire office fit out or refit as well as furniture through a lease agreement.

A study by the Commission for Architecture & the Built Environment and the British Council for Offices has revealed that even simple things such as good lighting can reduce absenteeism by 15 per cent and increase productivity by between 2.8% and 20%. It also found that an employee’s workplace is responsible for 24% of their job satisfaction and this can affect performance by 5%.

There are a number of elements to consider when refurbishing your work premises. These include:

  • Colour scheme: The use of colour can have a significant positive or negative affect on employees. For example, neutral colours can be calming while the use of a bright colour as an accent can have an invigorating affect.
  • Lighting: Studies show a strong correlation between natural light and employee efficiency. Maximizing natural daylight can create a positive atmosphere and mood, where as a lack of light or dim artificial lighting can be depressing. New lighting including LED lighting can be leased.
  • Layout: Partitions or open plan? The layout of a workplace should aid employees in their work and, if hosting customers, should be welcoming. Consider the work and needs of a department or employee, some may need to be able to interact easily across a space and others may need privacy and quiet.
  • Ergonomic furniture: It is essential that furniture meets the needs of the user, being both comfortable and functional, in order to minimise the risk of injury and maximise performance.
  • Acoustics and temperature: Noise levels and temperature in any office are important factors to ensure a pleasant work environment without unnecessary distraction or irritation.

When moving to new offices or injecting new life into your current premises, it is important that your interior reflects your company’s ethos and values, provides a positive work environment for staff and makes the right first impression with potential clients. Get it right and it can lead to increased productivity, improved staff morale and reduced absenteeism.

Your interior makeover doesn’t have to come at a high price either when you use leasing for your office refurbishment or fit out – from planning and design to interior finishes and installation, through a flexible lease. Lighting, flooring, furnishings, computer equipment and even moving services can be covered under one agreement. This means you only need to pay one monthly or quarterly payment for multiple suppliers.

With leasing, you can choose exactly what you need without compromising your cash flow or existing lines of credit, and spread the cost of the project over a number of years. Plus, lease payments can even be tailored to match seasonal cash flow and be set against profits to potentially reduce your tax bills.

For more information about improving your office environment and productivity with leasing for furniture and interior design you can download the Dream Office brochure and also the WestWon Finance for Interior Projects Factsheet.  Tel: WestWon on 01494 611 456 for details and lease pricing.

How Start-up Businesses Can Lease As They Grow

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Paying upfront for equipment or an asset can be a significant drain on the working capital for most businesses. In 2014, raising finance for business equipment and assets continues to be a challenging issue for companies, particularly new businesses just starting out.

With highly competitive interest rates and agreements, there is no doubt that leasing can offer an advantageous alternative to buying for start-ups. But how easy is it for a new business to get a lease agreement?

Well, obtaining a lease agreement can be more challenging for new businesses than established companies, but it is by no means impossible. In fact, arranging a lease agreement can be less complicated than applying for a loan. Some leasing companies like WestWon are increasingly working with new start-up companies and can provide specialist advice and guidance.

Generally, a new start-up will be required to submit their personal financial statements, personal tax returns, a business plan and details of equipment they wish to lease. Once submitted, the information is reviewed and a business should be able to obtain a quote and a decision in principle soon after.

There are several types of lease agreement, which allow a new company to acquire the assets they need to run their business without upfront capital outlay. What leasing does is enable the equipment to be paid for over a fixed period of time – typically two to five years through a series of contractual, tax deductible payments.

Leasing is great for new start-ups as it can help improve cash flow by preserving their working capital. This leaves funds available to reinvest elsewhere in the business or to cover unexpected costs that may arise. Many businesses also find leasing advantageous from a budgeting standpoint as switching from outright purchase to a lease agreement changes how the equipment is accounted for.

Leasing offers considerable tax benefits for new businesses too. Lease ‘rental’ payments are an allowable business expense that can be set against profit – thereby potentially reducing your tax bill. Other methods of equipment acquisition, such as outright purchase, do not have the same level of tax benefit.

For more advice on leasing and selecting a reputable leasing partner, download your free Essential Guide to Leasing for Business or call us on Tel: 01494 611456 for practical tailored advice.

 

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Everything You Need To Know About The History Of Equipment Leasing

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Equipment Leasing is not a recent invention.  Indeed, historians and economists believe that the first equipment leasing transactions took place in ancient Sumer from c. 2000 BC onwards.

The Sumerians were the first to use a place value numeral system and create multiplication tables. Sumerian writing is also the oldest known example of writing. They used triangular or wedge-shaped reeds to write on moist clay and the clay tablets found in the Sumerian city of Ur contain information about the lease of agricultural implements, land, water sources, cattle and other animals.

More about equipment leasing

Historians have also argued that Aristotle referred to the idea of ​​leasing in a treatise saying “Wealth is in use, not ownership,” written around 350 BC.

In more modern times – in the 1880s – the Bell telephone company introduced the concept of leasing instead of selling telephones, a decision that proved instrumental in the company’s success. But it was not until 1952 that the first industry association was formed; ‘The United States Leasing Company”. In the early 60’s American business practices had spread across the ocean to Europe. The first European leasing company – “Deutsche Leasing GMBH” appeared in 1962 in Dusseldorf. And the mid-60’s leasing transactions in the U.S. already accounted for 1 billion dollars.

In Western Europe the first financial leasing companies emerged in the late 50’s – early 60’s. In England, the “Mercantile Leasing Corporation” was formed in 1960 and following changes to tax legislation and the clarification of the legal status of leasing contracts, the number of leasing agreements began to quickly grow.

WestWon’s leasing heritage dates back to to 1976 with the acquisition of Power Leasing Limited, one of the first leasing intermediaries to incorporate in the UK.

Equipment leasing today

Today, in the 21st century, leasing is widely recognised as one of the most effective ways to purchase costly plant and equipment and to upgrade existing capital assets.  According to the UK Finance and Leasing Association FLA, £21.5 billion of finance was provided to businesses and the public sector, representing around 28% of all fixed capital investment (excluding real property and own-account software) in the UK last year.

As one of the UK’s leading leasing companies WestWon specialises in IT leasing, office furniture and fit out leasing and leasing for many other sectors and public organisations.

The Sumerians certainly knew a good idea when they saw one. Make sure your business takes advantage too! For more information about equipment leasing deals, you can download the essential guide to leasing – Finance Your Business Plans – or call WestWon on Tel: 01494 611 456.

Top 5 Things To Look For In An IT Support Provider

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A good IT support provider is a company that is able to listen to and understand your businesses needs. It is also vital to partner with a company that you will feel comfortable working with on a regular basis. With a large increase in the number of IT companies to choose from, it can make the selection process much more problematic. WestWon Leasing IT partner, Tegen, shares its perspective on how to go about finding the right IT partner and suggests you consider the following 5 points…

How To Find The Right IT Partner

1. Take References

These provide a different point of view and therefore give you something to compare your viewpoints with – they may give also you a glimpse into a company’s work ethics and ‘habits’. This is invaluable information from someone who has already had experience with them.

2. Look at partners

The easiest and quickest way to check potential partners’ credibility is to have a look at their website and search for any certificates, qualifications and/or industry accreditations that back-up their IT knowledge and skills. A company with an array of partners signifies that they have access to the latest solutions.  By forming strong partnerships with big brands, their service quality should excel.

3. Expect clear pricing

It is always good to know how you will be charged, amounts may vary depending on the service that is being provided. Remember to always check what is included in the cost to avoid any hidden or extra charges, and also what IT lease finance options are available.

4. Look for competency proof  

Ask potential suppliers to provide their service level agreements defining response times and resolution targets. Or alternatively, why not personally test the service out yourself. An IT partner who keeps you on hold, or where you have to go through a variety of stages on the phone before you are physically able to speak with a member of the Service Desk team is probably not a partner you want to work with.

5. Book a meeting  

Companies that recruit the best staff will usually be able to deliver the best services. People do business with people, so look out for company/individual awards that may represent a good work ethic where employees are valued by the company.

For more information about IT support, and to see how Tegen could benefit YOUR business see www.tegen.co.uk

Best Leasing Deals And What The ‘Cheapest’ Leasing Rates Really Mean

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When browsing for leasing deals, you may find leasing companies advertising the ‘cheapest leasing deal’ or ‘cheap lease rates’.  But what do those Internet ads really mean?  it is worth bearing in mind that the headline in the advert may not always paint the full picture.

There certainly are good leasing deals to be had, particularly for quality covenants and assets. During 2012 WestWon has seen many new banks entering the leasing sector along with a clear change in underwriting policies in that  banks are now lending to companies they would have rejected for credit a few years ago. The obvious impact of this is that the market price for leasing rates is reducing.

The cheapest rates we see start at just under 6% APR. You may well see these rates advertised at 3%, this is the flat rate.  Lombard (owned by Nat West) is one well known leasing company that offers competitive rates. Other high street banks also offer leasing and often some of the most competitive rates.

There are some fantastic manufacturer- subsidised deals out there for equipment, whether for a photocopier from Xerox, a computer from IBM or some specialist plant and machinery. Suppliers will often “blind discount” products to make the leasing deal look like it is interest free.

What is a good lease rate?

For the majority of businesses, lease rates start at around 8% APR and go upwards.  Rates depend on a number of factors such as:

  1. Strength of the covenant
  2. Type of equipment
  3. Deposit and term of the lease
  4. Other profit centres

Point four above is really important: leasing companies now make a lot of their profits from administration fees, yearly admin costs, insurance, upgrades, early settlements and selling equipment at the end of a lease. WestWon could easily offer an interest free agreement – or what looks like an interest free agreement – if we know there is a good resale value in the equipment.

Why do leasing companies charge documentation fees?

Like all companies, leasing companies have to make a profit. They provide a valuable service to UK companies by helping to fund assets and facilitate growth. Paying an interest rate – a fair market rate of say 8% – is often small in comparison to the value and return you get from having the beneficial ownership of the equipment you need without having to pay the full cost upfront.  And after all, it is not just leasing companies that charge documentation fees; for example, many high street banks charge a fee for setting up an overdraft facility.

How much is a leasing documentation fee? The documentation fee for a lease agreement can range from £75.00+VAT to £150.00+VAT.

So in summary, there are good deals to be found, but remember, don’t just look for the cheapest leasing rate, look at the overall cost of the lease with other items such as admin and insurance factored in.

For more information about the best  leasing deals and cheap lease rates, call WestWon on Tel: 01494 611 456

Leasing Cements Its Place In The Construction Sector

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The construction and engineering industries are highly competitive, so it is important to stay ahead of the game. Leasing can help you obtain the equipment your business requires to ensure you can keep pace with the latest technology. Investing in new plant equipment and machinery can be a huge outlay, but leasing offers an advantageous alternative for the construction sector to buying with highly competitive interest rates. Indeed, with banks reducing the amount of overdrafts and loans available to businesses, leasing and asset finance is increasingly being considered as the best and most tax efficient way to acquire new equipment or assets for the sector.

With a lease agreement, the asset you require is yours to use straightaway, but you pay for it in installments over a fixed period of time, which helps you spread the cost over the life of the equipment. You can also upgrade or expand your resources easily, as and when the need arises.

Furthermore, with leasing you have a fixed interest rate. This protects you against interest rate rises and enables you to plan your budget effectively. And as inflation rises, because your payments are fixed, the cost of the equipment reduces in real terms.

A wide range of equipment, from milling machines and welding equipment to portacabins and cement mixers, can be leased. Some of the types of equipment that can be leased include:

  • Welding equipment
  • Vehicles (e.g. cement trucks and tractors)
  • Bulldozers
  • Plant equipment
  • Portacabins
  • CNC machining centres
  • Surveying equipment
  • Cranes
  • Diggers
  • Drills
  • Lathes
  • Generators
  • IT hardware and software
  • CAD software

WestWon Limited has a wealth of experience in providing asset finance solutions for the construction and engineering sectors. For more information, download your free Essential Guide covering Construction and Engineering Equipment Leasing for Business. Or call Tel: 01494 611 456 for more information and an instant quote for the equipment you require.

 

 

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Technology Investment Sets Leading Leasing Companies Apart

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The second annual review of the UK asset finance brokers’ and independent lessors’ industry, authored by Asset Finance International and sponsored by Nostrum Group, reveals that UK asset finance brokers are experiencing a surge of new business demand in 2014 and this is coupled with a greater commitment to the benefits of investing in technology.

The soon-to-be-published UK Asset Finance Brokers & Lessors Review 2014  includes a unique host of interviews with broker practitioners as well as industry specialists and senior trade association staff.

It provides a fascinating comprehensive and forward-looking assessment of the market, its current and future drivers and key industry issues. As before, it has been compiled with the assistance and support of the National Association of Commercial Finance Brokers (NACFB), the British Vehicle Rental and Leasing Association (BVRLA) and individual brokers and funders.

Investment in leasing technology

The review reports a surge in interest and investment in technology. Although investing in technology has steadily grown to be an integral component of a broker’s business in recent years – most UK brokers now regard investment in updating technology as vital to efficiency and maintaining a competitive advantage.

Many funders are looking at introducing or improving proposal systems, particularly in the broker space where speed of service is critical. As one senior broker stresses: “A key area for technology has to be in terms of speeding up the time it takes from enquiry to getting a deal agreed. The sooner you can take a deal out of the market the better.”

Another adds: “IT in hand and use of cloud technology for back-up is business critical. As long as IT infrastructure, e.g. fibre optic broadband, across the UK is robust, this will be sufficient for many brokers.”

Another broker told Asset Finance International that investment in IT has been necessary to suit the business set-up, and has reaped rewards: “We have invested heavily in IT over the last five years (£90k) and developed our own systems with the help of our own IT consultants. We have a remote home-based sales force and this investment has allowed them to work faster and smarter with minimal downtime, which in turn has allowed them to do more front-line selling!”

WestWon leasing technology

WestWon has long been at the cutting-edge of technology investment in the leasing sector with the development of state-of-the art web-based technology for its online proposal system. It has also created the highly-successful WestWon Parent Portal for school parental donation schemes for iPads and tablets.

WestWon CEO Jeremy Hall comments, “Just a few years ago, finance and leasing was largely-conducted face-to-face and by phone. Today, these channels of communication remain an essential part of our client services. But we are also very much a technology-driven operation with a state-of-the-art quotation system, which allows us, our clients and our business partners to obtain instant rates for any type of equipment based on their specific requirements and business parameters.”

“Our purpose built lease administration system has been continuously developed over the years and is, without doubt, one of the most advanced client-based asset finance CRM systems in the UK.  This powerful tool lies at the very heart of what we do, underpinning our success to date and future plans for growth, and offering  a smooth and seamless transition from initial quote to final funding for our many clients. We also lay claim to offering one of the industry’s most user-friendly websites at www.westwon.co.uk .”

For more information call WestWon on Tel: 01494 611 456

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