5 Ways to Make Lemonade: Business Finance Tips

No matter which way you look at it, the first 6 months of 2020 has been an absolute lemon. For Australian businesses, employers, employees and the entire global economy. But as we hit the half-way mark, businesses are being encouraged to get out of the ‘holding pattern’ that we seem to have been in during this unprecedented crisis.

Lockdowns, shutdowns, closed borders, travel restrictions, recession, restart, stimulus packages, recovery measures – with the fast-moving nature of events it’s been hard to stay ahead of the curve. With restrictions easing and the many sectors of the economy working back towards a new normal, now might be a great opportunity for you to assess your business finances and take steps to make lemonade from the lemon that is coronavirus crisis.

Jade Finance provides a comprehensive range of business finance solutions and we offer some suggestions that may give your business a boost and the impetus needed at this time.

Tip 1: Utilise the current low interest rates

RBA Governor, Philip Lowe, has given strong indications on a number of occasions, that he does not expect to reduce the official cash rate any lower than the current level. Interest rates are at historic lows now and now is the time to take advantage of the situation with cheap equipment, motor vehicle, truck or marine finance.

Jade’s cheap interest rate policy doesn’t fluctuate with economic conditions – we’ll always source you the best rates, but the current rates make our deals even cheaper. Interest rates are the basis of equipment finance, truck loans, car loans and other finance and affect the overall total cost of a loan.

With some large equipment finance deals running over 7+ year loan terms, the interest rate can make an extremely significant impact on the total cost of a loan, especially over that longer term.

Acting now on those asset acquisition will give you the opportunity to secure cheap finance and for eligible assets for eligible businesses, also realise additional tax benefits with the IAWO.

Tip 2: Refinance to consolidate debt

Are multiple loans restricting your business opportunities? If you’ve acquired several items of equipment or motor vehicles, possibly a number of caravans if you run a holiday parks, over the past few years, each with a separate finance contract, the multiple monthly repayments may be exerting pressure on your cash flow. Especially against the COVID-19 crisis backdrop, businesses are looking to be as flexible and fluid as possible.

Jade Finance may be able to assist you with a refinance deal. This may involve rolling several loans into the one deal so you only have the one monthly repayment or looking at each loan separately and seeing what options would benefit you.

Be mindful that lenders charge fees for paying out a loan early, so any benefit to be realised would be considered against the costs incurred. If you have finance from your bank, it may be the right opportunity to ‘have the chat’ and talk a better deal. But you wouldn’t have to do that yourself. When you engage Jade Finance as your finance broker, your consultant can handle the discussions and use our finely honed negotiating skills to deliver a better outcome.

Tip 3: Free up funds with Debtor Invoice Funding

While you may have traded through the crisis well and are well-placed moving forward, perhaps it’s your customers that are passing on their problems to your business. You may be experiencing slow payers and having to wait 60+ days and longer for invoices to be paid.

That’s income that you might require to pay your own bills, your staff and invest in new equipment. All tied up while you wait for your customers to pay up.

If you’ve been going along with this practice perhaps for years, maybe 2020 is the time to say ‘enough’! Time for a solution. Jade Finance offers highly effective Debtor Invoice Funding which is designed to allow businesses to better manage cash flow.

This loan facility allows you to receive a percentage of your invoices at the time the invoice is raised via a lender and the balance, usually set at a small percentage of the overall invoice, at a later date. The cost is relatively small and interest is payable only for the outstanding time.

We’ve detailed Debtor Invoice Funding in our website, so head to that page for all the information or speak with a Jade Finance consultant to discover how this finance may transform the way your business operates.

Tip 4: Get a better overdraft deal

Most businesses operate with a bank overdraft. It’s almost essential in some sectors. But the interest rates and strict bank conditions and guidelines can pose challenges. Jade Finance offers an alternative with a Business Overdraft arranged through a non-bank lender.

The facility operates on similar lines as an overdraft except it is not through your transactional bank. We’ve covered all the details on this operates on our dedicated Business Overdraft web page. Have a read and if you’re think that is a solution which may work for you – give us a call.

Tip 5: Ease cash flow pressure from large insurance premiums

Commercial insurance policies with one single annual premium payment can place major pressure on businesses when that payment is due. Unlike many consumer insurance policies, most commercial insurers do not offer instalment payment options.

Insurers don’t, but Jade Finance does offer a solution – Insurance Premium Funding (IPF). A specialist lending product which your Jade consultant can negotiate with lenders offering the facility. Your large premiums may be split into 6 monthly or quarterly payments with interest and fees applicable.

Jade Finance offers a range of business finance solutions that may be just what your business needs to ensure the rest of 2020 and FY21 is successful and profitable.

Contact Jade Finance to discuss finance solutions for your business. Call 1300 000 008