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The UK transport and logistics sector is foundational in supporting other industries and sectors and facilitates the smooth movement of goods in this country and abroad. It goes hand in hand with a thriving economy.
If transport and logistics stall, the knock-on effect on other industries is widespread, and the sector is not short of challenges. With the global pandemic following Brexit upheaval, transport and logistics firms have faced a range of threats in recent years.
Finance for this sector needs to be flexible and fast to access, and fortunately, businesses can secure a wide range of commercial finance products to ease cash flow and deal with sudden changes in the market.
UK Business Finance are finance specialists with extensive knowledge and experience in helping transport and logistics businesses secure vital funding. We help businesses to grow and prosper despite what can be an unpredictable operating environment.
High cost of fuel
Consistent fluctuations in the global price of oil, coupled with the war in Ukraine, have reduced profit margins and created serious financial difficulties for some transport businesses.
Shortage of heavy goods vehicle drivers
A shortage of HGV drivers has disrupted supply chains and caused delivery delays. The shortage exists worldwide, but it was worsened in the UK as fewer overseas drivers worked here post-Brexit. A backlog of HGV driver tests due to Covid-19 also exacerbated the problem - although the situation has improved following government action, it will take longer to resolve.
Transport decarbonisation
Transport decarbonisation by 2050 may be hampered by a lack of battery charging infrastructure across the UK. A further issue is that commercial vehicles require charging facilities tailored to their size, including bigger charging bays and longer cables.
Sustainability initiatives
Sustainability initiatives brought in by the government, such as Low Emission Zones (LEZs) in major cities and Clean Air Zones (CAZs), increase costs for transport businesses that may need to upgrade vehicle fleets or circumnavigate cities at the cost of higher energy prices.
Vehicle finance
Vehicle finance helps transport firms to purchase one or more vehicles using hire purchase or vehicle leasing. It avoids the need for huge capital outlay and provides for more accurate monthly budgeting as payments are fixed for the term of the arrangement.
Asset finance
Transport and logistics firms can spread the cost of hard and soft assets, such as computer equipment or warehousing fixtures with asset-based lending. It is a medium-term solution that helps a business to expand without using up valuable capital.
Invoice finance
Invoice finance may be suitable for businesses in this sector as it uses the value of a company’s sales ledger to generate regular inflows of working capital. The lender releases a proportion of each invoice shortly after issue, which boosts cash availability.
Our highly experienced team at UK Business Finance will search the whole of the market to find the best deals for your transport or logistics business. We are commercial finance brokers, not lenders, and we know the criteria of all the UK lenders.
Please get in touch to find out how our transport and logistics finance experts can help your business.
How we help other Sectors
We work across a wide range of sectors throughout the UK, providing specialist advice to each sector.
How to financially prepare for investor exits
Whether your business is at an early stage or it’s more established, the financial boost provided by external investment, such as from private equity firms, angel investors, and venture capitalists, is invaluable.
How to finance a MBO
If you’re considering conducting a management buyout (MBO), there are various means by which you can fund it. Financing commonly involves a level of personal funding by individual members of the management team combined with additional external borrowing, such as bank loans and asset financing.
What lenders look for in a business loan application
Knowing what lenders look for in a business loan application helps you present your business in the best light – an important consideration, as being rejected for a loan damages your company’s credit rating and makes it difficult to borrow in the future.
What is a commercial finance broker?
A commercial finance broker is a professional intermediary who helps business owners to source the best lenders and deals. They provide a vital service that eases access to funding and ensures businesses obtain the most appropriate finance for their needs.