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PUBLISHED ON: 12/05/2023

Commercial finance for manufacturing businesses

Our strong manufacturing sector plays an essential part in the economy and a key role in global exports. It supports employment in the UK and is integral to the country’s economic health post-Brexit.

The sector does need to attract new talent, however, with the knowledge and understanding of new technologies that are now being adopted, including artificial intelligence and robotics.

A further issue is having the agility to respond quickly to changing global markets, and produce sustainably/reduce waste. These require finance products that support manufacturing businesses at all stages.

UK Business Finance are commercial finance brokers with extensive experience in helping manufacturing businesses to find the finance they need. Our services are free and we do not ask you to sign an exclusive contract to use them.

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With full market access and absolutely no ties to any lender, we can objectively match you with the most effective and cost-efficient source of business finance. Contact our team today!

Challenges facing the manufacturing sector

Achieving net zero carbon targets
Manufacturing is inherently an energy-intensive industry and reaching net zero may be a challenge without making a shift in how products are made - using lower energy machinery, for instance, and sustainable materials that reduce wastage.

Adopting digital technologies
A move away from traditional manufacturing methods towards technology-led alternatives demands a significant investment. This may not be possible for smaller manufacturers or those without professional guidance on the best ways to finance it.

Filling the skills gap
The wide adoption of advancing technology and a shortage of workers with STEM (science, technology, engineering, and mathematics) experience means that a skills gap could jeopardise growth in the sector as we move towards ‘Industry 4.0.’

Commercial finance for the manufacturing sector

Machine finance
Machine finance, which can incorporate hire purchase and machinery leases, facilitates the purchase of expensive assets, typically over several years. Hire purchase leads to ownership of the asset if required, and a machinery lease offers flexibility at the end of the contract – businesses may be able to extend the lease, return the asset, or upgrade it to a newer model.

Machinery refinance
If a business already owns expensive hard assets, it can unlock the capital held in them by refinancing. A financier buys the asset and then leases it back to the firm using a fixed monthly repayment schedule. Refinancing provides a valuable cash injection and allows for more reliable budgeting.

Supply chain finance
Supply chain finance is based on the buyer’s credit rating and can benefit both trading parties. Suppliers are paid by the lender as soon as their invoice is issued and approved by the client. The buyer also benefits from extended payment terms and can preserve working capital.

Working capital finance
Working capital finance can be a good option for manufacturing businesses undertaking growth or innovation projects. It supports working capital availability when the costs associated with a development initiative increase. This type of finance can be used for a range of expenditures, including utilities and wages.

Applying for manufacturing finance

Before making an application for manufacturing finance it is key to obtain a variety of quotes from different lenders. UK Business Finance can conduct a whole-of-market search to find the best and most appropriate finance deals for your manufacturing business.

  • We are commercial finance brokers, rather than lenders
  • We offer our services free of charge to you, and there is no exclusive contract to use them
  • We know the criteria of all the lenders in the UK and will write the applications on your behalf

For more information on securing the best type of funding for your manufacturing needs, please get in touch with our expert team.

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