Opening up Allsorts of Opportunities for The Black Liquorice Company

The story of Black Liquorice Company goes back to owner Tom Rose’s university days, where he bought sweets in bulk from a wholesaler, packaged them himself and sold them at car boot sales to earn money while at university. A part time earner turned into a cottage industry and when the storage requirements outgrew the family home, a chain of sweet shops followed. 7 years ago, Tom realised that the people of Britain deserved better quality liquorice, leading him to start The Black Liquorice Company, based near Evesham, selling a wide range of high-quality liquorice products.

Here’s what Tom had to say…

“Being a small start-up business, we have always struggled with cash flow. We import most of our raw materials and our suppliers want paying on 30 days. It takes 3 weeks for the goods to reach our warehouse and that’s before we have manufactured and distributed our product to our customers. We have a lovely customer base of farm shops, gift shops, cafes and other quality retailers and we like to be able to offer them payment terms, to make our overall offering attractive. However, from paying for our raw materials to getting paid ourselves can take weeks, which puts a real strain on our cash flow.

Growing the business has been difficult; with our cash flow locked up in unpaid invoices, we couldn’t buy the levels of stock required to meet an ever-growing demand. During Covid, our online sales went through the roof, and we found ourselves turning down business opportunities as we just couldn’t meet the demand.

We looked to banks and larger lenders, but because our historic accounts didn’t reflect what was actually going on in our business at the time, no one was willing to help us financially.

After chatting with the team at FlexABL, it was apparent that their services would be the solution that we were looking for. They made the whole process so simple for us. Now we just upload our invoices and we receive cash within hours.

This has had a massive impact upon our business, helping us with our cash flow and enabling us to grow our business. Being able to pay our supplier invoices early has even given us the leverage to obtain discounts, improving our profitability.

Without the help and support of FlexABL I don’t think we would have been able to grow the business the way that we are and now we have ‘Allsorts’ of opportunities at our feet!”

The Prompt Payment Code

Could this latest review of the late payment culture, for businesses in the UK, at last prompt change?

The government announced back in January that it was going to review and adjust its Prompt Payment Code (PPC). This reform could see credit and payment terms reduced from over 60 and 90 days to around 30 days for SMEs.  Figures recently published showed that there was a shocking £23.4bn of late and outstanding invoices owed to UK companies.  This in turn has a further knock on effect, causing late payments to their suppliers, with the sobering facts of this being that over 50,000 business close every year said the Federation of Small Business.

The PPC was introduced, in the hope, that it would clamp down on poor payment practices and offer the lifeline that SMEs were looking for, to aid their cash flow.  It came in to force in July 2021 but still, one year later, it only has just over 3,000 businesses signed up to the voluntary code.

New data also reveals that over 70% of SME businesses suffer extreme late payments from their customers to show the true severity and scale of the issue.

The Prompt Payment Code isn’t sadly enforceable currently and businesses continue to seek alternative solutions to the issue that so many are facing.  Bank overdrafts were the original cashflow cure for SMEs but this product is a good as finished, thanks to Bank regulation. However Invoice Finance is now recognised as a growing and valuable solution for SME owners to consider as this allows them to release cash tied up in their unpaid invoices, until they are paid by their customers, thereby relieving the inevitable pressure on cashflow, which then allows them to reinvest and grow.

FlexABL see this issue on a daily basis and are working closely with a growing number of companies, to enable them to release cash from their unpaid invoices via innovative and, of course, flexible asset-based lending facilities.

A client, with a confidential facility in the plant hire sector said “I would highly recommend FlexABL. We are a small company and find them professional and very helpful, the transfer over to FlexABL was smooth and did not affect the running of the business in any way. The online system is clear and user friendly, with full support at all times.”

If you would like to speak with one of the team to see how we might be able to help with your daily cashflow conundrums please do give us a call on 0333 123 1111 or apply here

Supporting the UK’s small businesses

18 months ago, none of us could have foreseen what lay ahead. COVID has affected us all in so many ways and throughout the various lockdowns, small business owners have demonstrated their ability to react quickly and adapt, in order to keep trading. We have witnessed the resilience and creativity of British businesses – restructuring entire operations almost overnight, finding new ways to sell and look after customers and generally doing whatever was necessary to ensure that they survived.

Throughout the crisis, the Government’s support has been phenomenal, both in terms of the scale of financial assistance provided and the speed with which the various schemes were delivered. CBILS and Bounce Back Loans kept liquidity in the system, while the Furlough scheme ensured that we avoided mass unemployment. HMRC have remained lenient when dealing with arrears and the suspension of court action against overdue creditors has given businesses the best possible chance of riding out the storm.  

However, this support could not continue indefinitely and as we emerge from the crisis, business owners are now facing a new set of challenges: supply chains in some sectors are stretched to breaking point, labour and raw materials costs are spiralling and debt accumulated over lockdown now needs to be addressed and repaid.

Of course, it’s not all bad news; the economy is showing real signs of recovery and order books are growing. However even that can bring its own set of challenges as growing sales can mean a need for greater working capital funding, at a time when business cash flow is already stretched.

Invoice Finance could play a part in addressing these challenges, delivering a flexible and cost-effective source of working capital finance. Furthermore, an Invoice Finance facility is designed to increase in line with a business’s sales growth, so with order books improving generally, now may be an ideal time to explore how it may be able to help your business.

What is Invoice Finance?

Put simply, Invoice Finance allows you to release the cash locked up in outstanding B2B invoices – often a company’s biggest asset. A lender will typically advance 85% of the gross value of an invoice, although this can be higher or lower, depending on the circumstances.

The flexibility of Invoice Finance

Unlike traditional loans, the funding available through an Invoice Finance facility typically grows in line with your sales. With many businesses experiencing an upturn in orders, this form of working capital finance could assist in funding growth and in a world where company losses over the last 18 months are commonplace, most Invoice Finance lenders are more interested in where the business is headed, rather than looking at historic accounts, when assessing a borrowing request. This makes Invoice Finance particularly suitable for companies that find themselves wrestling with the challenges of funding cashflow, post Covid.

What do FlexABL offer?

We provide a full range of invoice finance solutions, which can be tailored to meet the individual needs of your business. If you sell goods or services on a Business to Business basis then we can usually find a solution to your requirements. Our systems link to most of the cloud-based accounting systems, but we can also deliver a more traditional, hands-on service – the choice is yours. Either way, our aim is to release cash from your outstanding invoices quickly and easily.

Why are FlexABL different to other lenders?

We appreciate that no two businesses are the same and so we take the time to understand your business and goals. We are agile enough to react quickly to your changing needs and we offer a level of personal service that most of our competitors simply can’t match. For example, every one of our clients has direct access to a decision-making director, so they have the comfort of quick decision-making when required. We can also offer confidential facilities (where your customers are unaware of our involvement) to smaller businesses. Indeed, we are so confident in the quality of our service, we don’t insist on locking our clients into long-term contracts, unlike our competitors, where 12 months, or even longer, is the norm.

What should I do if I’m considering Invoice Finance?

Please get in touch. We want to make sure that Invoice Finance is right for you, so please contact Paul Stokes or Eric DeArmitt (details below) who will discuss your requirements and talk you through your options.

At this stage we can also provide you with a quote and give you an indication as to whether we will be able to assist you. Assuming that you are happy to proceed to the next stage, you will have the option of linking your cloud-based accounting package to us so that you can apply online, or you can send financial information to us via email, if you would prefer. Either way, we will be back to you within 24 hours with a decision.

Eric DeArmitt                     edearmitt@flexabl.co.uk              07436 037234

Paul Stokes                       pstokes@flexabl.co.uk                  07557 303333