Friday, 20 December 2013

Banking Reform Act Becomes Law

The biggest reforms to the UK banking sector in a generation become law

The government's Banking Reform Bill has received Royal Assent, now becoming an Act of Parliament.

The Banking Reform Act is a key part of the government's plan to create a banking system that supports the economy, consumers and small businesses.

It implements the recommendations of the Independent Commission on banking, set up by the government in 2010 to consider structural reform of the banking sector.

It also implements key recommendations of the Parliamentary Commission on banking standards, which was asked by the government to urgently review professional standards and culture in the banking industry following revelations of attempted LIBOR manipulation last year.

The government's reforms are based on almost three years of consultation on the future of the UK's financial sector and represents the biggest ever overhaul of Britain's banking system.

Since 2010, the government has acted to transform the banking industry through four key areas of reform:

- supervision: the government has put the Bank of England back at the centre of the supervisory regime, with new powers to identify and address systemic risks as they emerge, ensuring safe banks that will not bring down the economy in the future;

- structure: the government has brought forward new laws to separate the branch on the high street from the trading floor in the City to protect taxpayers when mistakes are made;

- culture: the government is imposing higher standards of conduct on the banking industry by introducing a criminal sanction for reckless misconduct that leads to bank failure, and a more stringent approval regime for senior bankers;

- competition: the government is acting to empower consumers by giving them greater choice, which should incentivise innovation and competition within the banking sector.

Financial secretary to the Treasury, Sajid Javid, said:

"I am delighted that the Banking Reform Bill has received Royal Assent. This is a major milestone and marks the end of a three year process, led by the government, to make the UK banking system stronger and safer so that it can support the economy, help businesses and serve consumers.

"From the outset the government has built a consensus on this issue and this legislation will deliver crucial changes to the structure of banks, ensuring that UK taxpayers are not on the hook for future bank failures.

"The Banking Reform Act will also help to deliver much need competition in the banking sector and increase the conduct standards amongst bankers."

Sir John Vickers, who chaired the Independent Commission on Banking, said:

"With key Independent Commission on banking recommendations now in law, the UK is at the forefront of banking reform. The international reform effort still has further to go - to ensure that banks have deeper capacity to absorb losses, and to build safer structures for banks in the rest of Europe."

Wednesday, 27 November 2013

Invoice Finance has strongest quarter ever.

Total sales from businesses supported by invoice finance broke £71bn for Q3 2013, the strongest ever quarterly performance; this is up by some 14% on the same period last year.

The latest quarterly figures from the Asset Based Finance Association show that the invoice finance industry is now supporting more than 43,000 businesses. Total client turnover for 2013 to date stands at more than £202bn, with invoice financiers projected to support over £270bn of client turnover for the full year. This would be an increase of more than 6% on 2012’s record total.

At the close of Q3, ABFA members had total advances out to clients of some £17.4bn, up 6% on the same period in 2012. This is only the fifth time the funding balance has been above £17bn, and the industry has achieved this milestone in both of the last quarters.

This contrasts markedly with the wider lending picture. Net lending to SMEs contracted by £1.4bn in Q3 2013, continuing its general trend throughout 2013.

The invoice finance industry continues to support smaller businesses, with almost 15,000 being found in the £0 – £500,000 turnover bracket, and over 30,000 in the sub-£5m bracket. However, the data shows that invoice finance is being used by more larger businesses as well; the biggest increase in client numbers was seen in the £100m+ turnover bracket, up 8% on the previous quarter.

Invoice financiers are most active supporting the services (30%), manufacturing (29%), distribution (24%), transport (7%) and construction (5%) sectors. The industry is reporting particularly strong demand in the services sector from the recruitment industry.

ABFA chief executive Kate Sharp said: “With the OECD revising upwards their predictions for the UK economy, and stronger-than-expected GDP figures, the recovery is clearly well underway.

“The latest figures show that the invoice finance industry is playing a central part in the recovery, with record client sales figures for the last quarter and continued growth year-on-year in the funding balance. The strong demand for this type of funding from small and large companies alike is heartening; so too is the diverse sectoral split. Firms which need finance should be speaking to their funders and advisers about invoice finance, as the industry can help many more firms grow and take full advantage of the economic recovery.”

Tuesday, 8 October 2013

Finance for Growth Seminars

Are you a business looking for finance to grow but are uncertain of what sources would be right for you? If so, these FREE seminars are for you!
Enterprise M3, the Local Enterprise Partnership for the wider M3
corridor, is hosting a seminar aimed at helping businesses both
understand and access new and established sources of business

During these seminars, you will:

• Gain a valuable understanding of what you need to do to
prepare for investment.
• Explore what types of finance are right for your business at this
particular stage of its life cycle.
• Find out about the range of new and established sources of
finance currently available to the market.

Sources of funding covered in the seminar include: crowd funding
(debt & equity), invoice financing, equity funding such as venture
capital and business angels and export finance.
Details of the seminar:

Date: Wednesday, 23 October 2013

Time: 9 am to 12 noon (Registration from 8.30 am)

Venue: Lyndhurst Park Hotel, High Street, Lyndhurst,
Hampshire, SO43 7NL

To book a place, go to:

This seminar is at no cost to you thanks to the kind support of
Guildford Borough Council and New Forest District Council who
are hosting the events on behalf of Enterprise M3 and a range of
private sector experts who are speaking at the seminars.

Thursday, 3 October 2013

Small Firms at risk due to lack of credit checking

More than three quarters of UK SMEs have lost money as a result of a customer becoming insolvent, according to new findings published by information services company Experian.

The firm surveyed 600 SMEs to understand the impact of customer insolvencies in the supply chain; it found that, in the last five years, 76% of SMEs have lost money as a result of customers failing. Nearly a fifth (19%) of these businesses each lost between £5,000 and £10,000, while 35% lost more than £10,000 over five years.

When asked how often credit checks were carried out, 68% of SME owners said they checked their customers’ and suppliers’ credit ratings at least once a year; 24% admitted that they only credit checked new customers, and didn’t carry out ongoing checks; 38% had been running a business for over two years but had only just started carrying out regular checks; and 34% of business owners only started monitoring suppliers after they had already lost money. Ade Potts, managing director of Experian’s SME business for the UK and Ireland, said: “Waiting until you’ve lost money to do credit checks is a bit like shutting the stable door after the horse has bolted. Unless businesses check the credit status of their customers at least once every six months, they risk exposing themselves to further loss.

“The rate of deterioration is far quicker for companies in today’s climate, so the sooner you can spot the signs of financial stress, the sooner you can react. Ongoing monitoring, addressing financial issues such as late payment of invoices head-on and not relying on one big customer or supplier will help lessen the risk of further losses as a result of insolvencies.”

Tuesday, 1 October 2013

Debt Crowdfunding for Non Limited Businesses

Up until now debt Crowdfunding has only been available to Limited Companies and LLPs with at least 2 years accounts filed at Companies House. On the 21st October Funding Circle will be launching their new service for Non Limited Businesses.
Pegasus Funding Resources is proud to announce that we are one of only 150 brokers who have been authorised to offer this new facility to clients.
An application will require the same information as for limited companies plus bank statements and details of property ownership. This includes: Year to date financial information (management accounts) for the business as for limited company applications, no more than 3 months old including:
• Turnover
• Cost of sales
• Admin expenses
• Interest paid
• Tax paid
• Other (if applicable, please specify)
• Net profit
• 3 months of business bank statements
• Last 2 years of formal accounts
• Statement of personal assets or details of property ownership including address, value and mortgage outstanding for all partners
• Name, address and date of birth of all partners
• Details of the partnership split (but not the partnership agreement document)
• Certified photographic I.D. and proof of address for all proprietors
• Outstanding loans & credit info
• Completed application form submitted online.

Minimum loan size is £25,000, loans above £100,000 will require sufficient security in the form of fixed assets. The business will need to demonstrate affordability of the loan. This is a much needed new service to SMEs.

To find out more contact:
Peter Kelly
Pegasus Funding Resources
01932 244810

Monday, 22 July 2013

Entrepreneurs Succeed with us. Launch date 24th July

Peter Kelly the founder of Pegasus Funding Resources has Co-authored this exciting new business book for SMEs.
This book is a highly readable set of principles and actions, which will convert readily into increased performance and profits in your business.
Entrepreneurs can sometimes struggle to meet the goals they have set themselves and may need help to create the high performance business of their dreams. The aim of Entrepreneurs Succeed with Us is to help such entrepreneurs get to grips with difficult to identify and resolve business-critical issues and kick-start growth plans to achieve their goals. These may include a successful exit strategy. The book has been written by a team of highly capable professionals who appreciate the pressures of an entrepreneur's day to day and longer term problems. Its content is designed to help them recover from difficult situations by getting to the root causes of their sleepless nights.
Entrepreneurs Succeed with Us addresses a range of key issues that face all entrepreneurs at some point in their business. It examines the health of a company and helps re-examine both the company mission and the owners personal vision for the future. It also identifies alternatives to banks for financing the business, improvements that can be made to marketing to kick-start growth and the best strategies for a successful exit to your retirement plan. The book also explains how developing a growth mindset is vital to any companys future success, as is avoiding many of the pitfalls in developing ICT systems and complying with employment and other laws.
To find out more Click here to see all about the authors:
And Click here to buy from Amazon

Monday, 1 July 2013

Insolvency Figures show better start to the summer.

The latest Business Insolvency Index from Experian reveals that, overall, the business insolvency rate for the UK maintained its low level of 0.08% for the fourth month running, down from 0.09% in May 2012.

The insolvency rate fell in seven out of the 11 government regions in May 2013 – a major improvement on the same month in 2012, when just one region, Yorkshire, saw an improvement on the previous year. Insolvencies in the north east fell from 0.14% in May 2012 to 0.11% in May 2013, and Scotland also continued its recent form as insolvency rates stayed at 0.03% for the sixth month in a row.

Looking at insolvencies by company size, smaller businesses – which represent the vast majority of UK companies – have again done well. The best performance compared to last May was among companies with six to 10 employees, down from 0.20% to 0.16%. In fact, the insolvency rate amongst all companies with less than 10 employees, representing 1.8 million businesses, hasn’t risen for the last four months.

Max Firth, managing director of Experian Business Information Services for the UK and Ireland, said: “May’s insolvency figures show improvements across many areas of the UK. What’s particularly pleasing is that insolvencies among smaller businesses, which are the backbone of the UK economy, are showing a longer-term change for the better, while building and construction firms can also take heart at the drop-off in insolvencies after a particularly difficult period.”

Thursday, 6 June 2013

Asset Based Finance Helping SMEs

New figures from the Asset Based Finance Association (ABFA) show increasing numbers of smaller businesses turning to invoice finance, against a backdrop of some tentative signs of economic recovery.  
The latest figures (for Quarter 1, January – March 2013) see smaller firms increasingly using asset-based finance (£0 - £500,000 t/o) with client numbers in this bracket up by 439 or 3% just in the past quarter alone (Q4 2012 – Q1 2013). In total over 15,000 of the smallest businesses in the UK and Ireland are supported by asset-based finance, using the products for working capital and to fund growth. This is the highest figure for these smallest firms for nearly three years.
Overall the asset-based finance industry and the clients it supports have demonstrated encouraging growth.  Total sales from businesses using the products are up 9% compared to the same period last year (Q1 2012 – Q1 2013), hitting £63bn.
Total funding provided by the industry to clients has also risen, with advances from the ABFA’s members growing from £15.3bn last year (March ’12) to £16.3bn this year (March ’13), an increase of 6%.  This figure for funding provided is even more notable when set against the contraction seen in other forms of finance provided to SMEs (UK net lending was down 2% compared to the same period in 2012).
With the total number of businesses of all sizes supported by asset-based finance also rising by nearly a thousand year on year, it is clear that there is a developing awareness and appreciation of the industry’s products that are available.
Kate Sharp, chief executive of the Asset Based Finance Association, said: “It is extremely heartening to see so many of the smallest businesses choosing to use asset-based finance to fund their growth. Having recently surveyed accountants we know they say that access to funding is still a major issue for their clients. With some signs of confidence returning it becomes ever more important that firms can take advantage of the new opportunities that growth presents.
This is where asset-based finance already plays an important part, and our industry is ready and willing to do more to help fund the recovery.”

Thursday, 23 May 2013

How safe is your cash with a bank?

 Having money in your bank is safe?   Well maybe not!
Since Carr vs Carr in 1811, when you deposit your money with a bank they create a debtor account and you become an unsecured creditor of the bank.
However, UK financial institutions with a banking licence are covered by the Financial Services Compensation Scheme (FSCS), which is designed to protect your deposit if the bank were to become insolvent.
The limit is £85,000 per person. So for a joint account cover of £170,000 is available.
If you have more than these amounts in a bank or building society account do make sure you spread it around amongst other banking licence institutions to protect yourself.
However, one thing to be aware of is that this limit is per banking institution - not per individual bank, so Lloyds and Cheltenham and Gloucester come under the same licence.
As an example, recently the Co-op bank has been in the news since Moody’s downgraded it’s credit rating to “junk bond” status.
Within the same banking institution as the Co-op bank is Britannia Building Society. Therefore, if you held an account in your own name only with both institutions with £50,000 in each of them you would in fact not be properly covered if the bank were to fail.
In total your deposits amount to £100,000 but since both institutions are under the same banking licence, in a worst case scenario only £85,000 of this amount would be covered.
So make sure that you spread your money around banks with separate licences.
I spoke to a prospective client who had €300,000 in one bank in Portugal.
He thought he was cautious and wanted to leave that money in a deposit account rather than putting it into investments. I advised to him was to move it asap and spread it around at least 4 separate banking institutions – This risk is lower even if he is getting a lower interest rate than with his current bank.
The aim must be to preserve capital even if you lose a small amount on the interest rate.
If you have any queries on where your money is currently held and you are concerned about what to do, please do call me on 01483 453755.

Monday, 20 May 2013

Euro suffers after eurozone recession continues into 2013

The euro fell across the board on Wednesday morning after the release of economic growth figures showing that the eurozone economy had remained in recession for a record sixth consecutive quarter.
Andy Scott, premier account manager at foreign currency exchange brokers HiFX, said: “As a collective, the economy of the 17 member countries contracted by 0.2% in the first three months of 2013, following a fall of 0.6% at the end of last year. The euro fell to a six-week low against the dollar, below 1.29, and fell by around 0.75% against the pound.
“Most of the individual country figures were worse than expected with France, the euro area’s second-largest economy, back in recession for a second time in the past four years. Italy’s recession continued for a seventh consecutive quarter, contracting by a further 0.5%. Germany narrowly escaped recession with growth of just 0.1%, which was less than expected, with the figures for the end of last year also being revised lower to show a contraction of 0.7%.
“It’s unlikely that these figures will have surprised anyone who pays even just the slightest attention to the news. The eurozone has some deep and entrenched issues that have come to light over the past few years. Several economies in southern Europe had been growing predominantly thanks to increasing government borrowing and spending. Now that Germany has a hold of the purse strings and global investors have demanded much higher rates of interest to lend money to these countries, the craters are there for everyone to see. The calls to ease the austerity measures that continue to damage confidence and hamper growth prospects will no doubt continue to increase but, publicly at least, Germany remains opposed to dramatically changing deficit reduction targets. There will also likely be additional pressure from politicians on the ECB to do more to try to stimulate the economy, but with interest rates at record lows of 0.5%, they may be limited in increasing demand. Monetary stimulus alone cannot undo the impact of economies that were largely dependent on state borrowing that is no longer available.
“The euro area looks like it could be in for a very tough couple of years with rising unemployment a problem that shows no signs of abating.”

Monday, 13 May 2013

Growth Predictions for UK Economy

The UK economy will continue to grow throughout this year, with GDP growth expected to pick up in 2014, according to the CBI’s latest economic forecast. But while recent economic data has been more promising, clear challenges remain both at home and abroad.

The CBI is forecasting GDP growth of 1% in 2013, unchanged from its previous forecast after official first quarter figures came in line with its expectations. Quarter-on-quarter growth is expected to gather pace gradually. The CBI is forecasting growth of 0.3% in the second quarter, 0.4% in the third and 0.4% in the final quarter of 2013.

In 2014, the CBI is expecting growth of 2%, with quarter-on-quarter growth to range between 0.5% and 0.6%.

John Cridland, CBI director general, said: “The UK economy is moving from flat to growth. Although recent data suggests rising business confidence, the economic climate remains tough, hampering demand here and overseas. Meanwhile, consumers remain under pressure as inflation continues to outstrip wage growth.

“Now the government needs to pick up the baton and deliver on promises to get finance to firms, cut red tape and help drive up exports.”

The CBI is forecasting that unemployment will see a small rise in 2013, to 2.58 million, before receding slightly to 2.51 million in 2014.

Inflation is expected to peak in the second quarter of 2013 (3.1%) before starting to fall steadily for the rest of the year, though remaining above target throughout 2014 (2.5%).

Uncertainty in the eurozone and the muted international outlook is limiting business investment intentions. Business investment growth of just 3.3% is forecast this year, but this is expected to pick up significantly in 2014 as global conditions improve (6.3%).

Eurozone growth continues to have a negative influence on UK export prospects, with an indifferent performance anticipated in 2013 (0.4%). An upturn in fortunes is expected throughout the next year, with 5% growth.

Household spending is expected to remain subdued with wage growth weak and unemployment expected to rise slightly. However, improving confidence, lower inflation and improving credit conditions should support a gradual improvement in household consumption, with growth rising from 1.3% this year to 1.8% in 2014.

Stephen Gifford, CBI director of economics, added: “Our latest survey data suggests that the momentum shown in the first quarter will continue into the next. We continue to expect UK economic growth to strengthen and become more broad-based over this year and next.

“Global uncertainty has receded somewhat, setting the stage for a gradual improvement in trading conditions.  However, while household incomes are expected to remain under pressure, improving credit conditions and confidence should maintain the momentum in the consumer recovery.”

Wednesday, 8 May 2013

Metro Bank & LGBA Selling Your Business Seminar

Selling Your Business

Metro Bank Fulham Broadway,
London SW6 1BW
(in the Fulham Broadway
station complex)

Wednesday 5th June 2013 from 6:00 p.m. to 8:00 p.m.

Please email by Friday 24th May 2013 to confirm your attendance
Whether you plan to sell your business now or in 20 years you should attend our informative seminar on Exit Planning at 6:00p.m. on Wednesday 5th June.  It will tell you how to assess the value of your business now, and what to do to increase that value.

It is an opportunity to learn about the way to prepare your business in order to obtain the maximum value when you wish to sell it.

Ideally you should start planning your exit about three years before you wish to complete it.  The strategy to increase the appeal to a potential buyer is significantly different from that used for business growth. 

Everyone present will be able to comment on anything they have heard, and to question the panel and the other delegates.

·         Hear from experts the best ways to maximise the value of your business
·         Make your own contribution to the discussions
·         Hear more about Metro Bank – the first High Street Bank to open in over 100 years
·         Enjoy some light refreshment whilst networking with other like minded local companies
Peter Kroeger ( ) specialises in preparing businesses for sale, and in the sale and purchase of businesses.
Stephen Cowburn ( ) will talk about the staffing aspects of sale.
Peter Kelly ( will talk about the funding aspects of buying and selling a business.

The event is organised by the London Group Business Advisors (, a network of people who have grown their own successful businesses, and have advised and mentored other companies.  Together they cover almost all disciplines (marketing, finance, HR, IPR etc).

Tuesday, 7 May 2013

Four Year Low for Insolvencies

Figures from the Insolvency Service show that company liquidations in England and Wales in Q3 2013 were down 5.3% on the previous quarter, and down 15.8% on the same quarter in 2012. Personal insolvencies also dropped in the first quarter of 2013 to 25,006, 12.9% less than the same period 12 months ago.
Bev Budsworth, managing director of The Debt Advisor, said: “It’s great to see levels of corporate and personal insolvency continuing to fall. This is a welcome bit of good news for all of us, but we mustn’t get complacent and must realise that there are still tens of thousands of people with serious levels of debt, facing wage freezes, redundancy, benefit caps and rising prices in an economy that is showing little or no growth.
“However, although liquidations and corporate insolvencies in general are down, they do tend to mask the true extent of the problem. In 2012, around 20,000 companies were wound up and for every one of these, at least a further 80,000 to 100,000 ran out of funds and were struck off with creditors, having no chance of making a recovery.
“If you look at the figures from the Centre for Retail Research, 2013 looks like it could be even worse with over half the number of companies failing in the first four months of this year as did throughout the whole of 2012.
“Up to the end of April this year has already seen off 28 retailers and effectively closed nearly 1,900 stores which has affected over 18,500 employees. Many of these companies could possibly have survived with more support from banks, who have removed overdraft facilities with little or no notice, or with more time to help them do deals with their creditors.”
Bev’s comments come at a precarious time for the economy, with marginal growth of only 0.3% and the cold weather in March being blamed for a dip of 0.7% in retail sales when compared to the previous month.
Bev continued: “Looking at the figures for County Court Judgements, we see a slightly rosier picture. The value of corporate CCJs in the first quarter of this year was 68.7 million, nearly 21% less than the figure seen in the corresponding quarter of 2012. Likewise, the actual number of corporate CCJs has reduced by around 10%, from 18,722 in the first quarter of 2012 to 16,847 in the first quarter of this year.
“It does point to the fact that although there are glimmers of improvement for the economy, we are certainly not out of the woods yet.” 

Friday, 3 May 2013

Small pick up for SMEs, but lending to businesses remains weak, says BCC

Commenting on the latest Bank of England figures on business lending, John Longworth, director general of the British Chambers of Commerce, said: “Although it is encouraging that lending to small businesses rose slightly in March, UK firms are clearly operating in a challenging credit environment. The new look Funding for Lending Scheme must work to rectify this and ensure that the money reaches fast-growing and relatively new firms, who continue to struggle to secure the credit they need.

“This is part of a wider problem around business finance. There has been a lot of talk about the business bank but it must be delivered with the sort of urgency and scale required for it to be a true player, and not a pretender, in the lending market. While not competing with commercial banks, the business bank should work towards plugging the gap in access to higher-risk finance that so many firms are unable to cross.”

Tuesday, 23 April 2013

HMRC doubles asset seizures from businesses over unpaid VAT

HMRC has almost doubled its use of powers to seize businesses’ assets in order to settle late VAT bills in the last year.
Syscap says that HMRC used its powers to seize business assets – a process known as distraint – 4,746 times to speed up the payment of VAT last year, a 98% increase on the 2,401 times it used these powers to recover overdue VAT the previous year.
Philip White, CEO of Syscap, said: “Small businesses need to be aware that HMRC is becoming more and more aggressive in claiming VAT payments. Where it might have made some allowances in the past, it is now much less likely to relent in chasing the payments it demands.
“Businesses could previously find some respite in the Time To Pay scheme, which could grant a short extension to a tax deadline. HMRC’s use of that scheme has now dwindled significantly, which leaves a lot of businesses with very few options.
“Prior to the credit crunch, banks were offering more credit to SMEs, so businesses could fund their VAT bills through loans or overdrafts. Since then, however, capital adequacy rules have forced banks to rein in their lending which has made it more difficult for SMEs to rely on bank funding alone.
“As VAT bills are payable on invoiced work rather than receipts, many businesses will find themselves paying tax on work they haven’t yet received payment for. These businesses are likely to have invested money up-front in fulfilling contracts, putting further strain on available cash.
“While this pressure on cashflow might have been a nuisance prior to the credit crunch, problems with a big VAT bill could now be a serious threat to the future of a business.
“It is vital that businesses explore what other funding options are available to them, to make sure they use the most appropriate funding lines to manage predictable events like tax bills, and keep short-term options like overdrafts for emergencies.”

Friday, 19 April 2013

The Brightest Star in Europe for Car Sales is the UK.

John Leech, UK head of automotive at KPMG, has commented on the figures released by the European Automobile Manufacturers’ Association, showing that the number of cars sold in Europe fell by 9.8% in the quarter ending 31 March 2013, and by 10.2% during the month of March 2013. 

“There is no light at the end of the tunnel for car manufacturers, as car sales continue to freefall in Europe. Indeed 2013 is already shaping up to be the seventh straight year of falling car sales in Europe. The UK remains the only bright spot, enjoying increased sales of 5.9% in March; it also compares favourably to Germany, which saw sales drop by 17.1%, and France with a drop of 16.2%.

“The UK performance is even more remarkable given that the euro has weakened by 10% compared to sterling in the last six months, meaning that it is 10% less profitable for European car makers to sell cars in the UK compared to six months ago.  However, at the moment the UK is the only show in town for car makers who remain happy to support the UK market with discounts at historically high levels.”

Tuesday, 16 April 2013

March freeze costs UK small businesses £174m, says the FSB

More than half (55%) of UK small firms have been impacted financially by the recent prolonged cold weather, costing them £174m, according to the findings of a new survey from the Federation of Small Businesses.

The research showed that around six in 10 small businesses were impacted by the cold snap and that loss of demand (30%) and closures (26%) were the common impacts. Of those who closed or temporarily stopped trading, an average of 2.2 days was lost. Furthermore, around 27% of firms had staff absent for at least one day. The FSB says that, on average, each business lost £1,580.

In addition to the effects of the cold snap, one in five businesses also said they had been negatively impacted by the flooding in 2012. 

Mike Cherry, the FSB’s national policy chairman, said: "We may finally have turned a corner into spring, but it's been a long haul, following the coldest March in 100 years. While a few businesses have managed to take advantage of the weather many have found it difficult to manage. Not only have they had to cope with a lack of demand for products, but many have had to close.

"Our fear is that this prolonged cold spell will mean people are travelling by car to supermarkets or out-of-town shopping centres rather than utilising local shops. We need people to keep trade local and support local businesses that may be struggling as a result of the weather."

Monday, 8 April 2013

SMEs get £70 million funding boost

Small and medium-sized businesses (SMEs) are set to receive a £70 million lending boost as part of government action to increase the availability of finance.
Three new lenders – Market Invoice, URICA and Beechbrook Capital – will share more than £30 million of government funding to offer SMEs alternatives to traditional bank lending.
They have committed to attracting additional funding from private sector investors, with the total expected to boost the pool of credit available to SMEs from the three lenders by more than £70 million
Business Secretary Vince Cable said on 22 March: “A lack of access to finance is still choking off too many small businesses, preventing them from growing, taking on new staff or investing in new equipment.
“We are taking a range of actions to support SMEs and shake up business finance markets, including through the new business bank.
“Today’s £30 million announcement is an important boost for non-traditional lenders with creative and innovative solutions. It will increase competition and create a more diverse and balanced market for business lending.”
The funding comes from the Business Finance Partnership (BFP), through which the government has committed to provide £100 million of funding for non-traditional lenders in order to diversify sources of finance available to SMEs.
Currently, 85 per cent of all business loans are handled by the big four banks.

Wednesday, 13 March 2013

Services businesses in the UK continue to grow

Small business domestic turnover rose by 0.43% between Q3 and Q4 2012 according to The Cashflow Barometer, a quarterly study by ABN AMRO Commercial Finance.

The Cashflow Barometer is an indicator of the financial performance of UK small businesses, based on analysis of 700 companies. Despitethe latest quarter-on-quarter growth, SMEs experienced an overall contraction in turnover of 0.43% between 2011 and 2012. These results reflect a challenging year for the manufacturing, distribution and engineering sectors, all of which saw turnover fall during 2012, with this sector-specific decline cancelling out year-on-year growth in other industries, such as recruitment and services. 

Peter Ewen, managing director at ABN AMRO Commercial Finance, commented: “Since recession struck, we’ve seen sporadic recovery across all small business sectors. However, as time has gone on, some industries have been able to maintain that growth while others have stalled.”

Between Q3 and Q4 2012, turnover in the services sector grew by 4.18%, while recruitment fell by 4.96%.

However, year-on-year, both of these sectors saw a rise in turnover, services by 5.54% and recruitment by 5.97%. Both recruitment and services also experienced a reduction in days outstanding for payment of invoices between Q4 2011 and Q4 2012 – recruitment by three days, and services by one. 

Distribution businesses saw a significant spike in turnover of 10.74 between Q3 and Q4 2012 – historically a strong turnover period for this sector, due to seasonal demand. 

Across the longer-term though, distribution turnover fell by 5.97% between 2011 and 2012, and debtor days increased by one. 

Engineering experienced a fall in turnover of 8.22% between Q3 and Q4, and a year-on-year fall of 6.68%. 

Manufacturing turnover fell by a modest 1.75% between Q3 and Q4 but had the most severe year-on-year retraction of any sector, falling 7.16% between 2011 and 2012. 

Peter said: “Despite seasonal blips, we’re seeing an overall trend emerge of turnover decline in engineering, distribution and manufacturing, coupled with growth in services and recruitment. Temporary and part-time employment has increased, bolstering the recruitment and services sectors, but this growth is not guaranteed to last in the long-term and is giving something of a false reading that everything is ticking along. 

“In reality, engineering, distribution and manufacturing need a significant boost in order for a sustainable economic recovery to be truly achievable.”

Monday, 11 March 2013

Single Invoice Discounting Meets Crowdfunding

Single or selective invoice discounting as it is sometimes called, has been available for quite some time. It has been very useful for those organisations that neither need nor want to commit to a long term, full ledger, invoice discounting or factoring agreement with one of the high street banks or with one of the many independent suppliers. With single invoice discounting you are not signing a long term agreement and you can chose when and how often you want to use the service and which invoices you want to sell and raise money on.
Many organisations use single invoice discounting when they have a VAT bill to pay, or when corporation tax is due. More and more people are using it to relieve the pressure on their overdrafts, if they are lucky enough to have one, or to fulfil that unexpected order that cash flow would prohibit them from accepting.
The one disadvantage of single invoice discounting has always been the cost. Interest rates of 0.2% per day are not uncommon and many managing directors are unwilling to accept these rates.
There is now another solution and that is to link single invoice discounting to Crowdfunding and auction the invoices that you chose to raise money on to the bidder that offers you the lowest interest rate. This reduces the cost considerably.
The details are as follows

·         The client pays a one off lifetime membership fee of £310.
·         The funding network then charges a transaction fee depending on the payment terms of the invoice. If it is a 30 day invoice then the transaction fee is 0.5% per auction, if 60 days then it is 0.75% per auction and if 90 days it is 0.9% per auction. There is a minimum transaction fee of £100, so small invoices might not make sense unless you bundle them together.
·         There is then the interest rate that has to be paid to the successful auction bidders. The lowest that has been charged is 0.5% per 30 days; the highest has been 1.5% per 30 days. The average so far is 1.44% per 30 days.
·         The seller, the client, sets the length of the auction from half a day to 5 days.
·         The seller also sets out the interest rate that they are looking for and then the investors hopefully bid that downwards.
·         The seller sets out the % of the invoice they want to sell.
·         There are no personal guarantees
·         There are no debentures.
·         They have a 100% record of raising finance at an auction.
·         If you have debentures against your company then waivers have to be sorted.
·         You need to have the money paid into the networks trust account and then they pay you. The trust account details have to be put on the invoices that you are going to sell.
·         The network checks to see if the auction actually makes sense.
·         Invoices from one debtor can be bundled together to make a larger single invoice. No multiple debtors in the same auction.
·         Average auction is £40K but there is no minimum or maximum.

This is a very interesting way of raising short term finance. To find out more please phone the nearest Pegasus Funding Resources contact listed below.
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Friday, 8 March 2013

Finance for Growth Seminar in Winchester

Are you a business looking for finance to grow but are uncertain of what sources would be right for you? If so, these FREE seminars are for you!

Enterprise M3, the Local Enterprise Partnership for the wider M3 corridor, is hosting a seminar aimed at helping businesses both understand and access new and established sources of business finance.

During this seminar, you will:

·         Gain a valuable understanding of what you need to do to prepare for investment.
·         Explore what types of finance are right for your business at this particular stage of its life cycle.
·         Find out about the range of new and established sources of finance currently available to the market.

Sources of funding covered in the seminar include: crowd funding (debt & equity), invoice financing, equity funding such as venture capital and business angels and export finance.

Date: Tuesday, 19 March 2013,
Time: 9 am to 12 noon (Registration from 8.45 am)
Venue: Winchester City Council, Walton Suite, Guildhall,
The Broadway, Winchester. SO23 9GH

To book a place, go to:

This seminar is at no cost to you thanks to the kind support of Winchester City Council who is hosting the event on behalf of Enterprise M3 and a range of private sector experts who are speaking at the seminars.

Pegasus Funding Resources are pleased to support this event.

Thursday, 7 March 2013

Services Sector Expands in February

The UK services sector continued to expand in February, according to the latest figures from Markit and the Chartered Institute of Purchasing and Supply. The headline Purchasing Managers' Index for the sector stood at 51.8, marginally unchanged from 51.5 in January but remaining above the 50.0 threshold that points to output growth. As the sector makes up roughly three quarters of the total UK economy, these latest results are encouraging news.

The latest increase in service sector output was driven by levels of new work rising at the fastest rate in nine months. Promotions and stronger business confidence helped to boost demand, with confidence standing at its highest reading since May 2012. However, there is evidence that bottom lines continue to be squeezed by rising input cost inflation, with firms reporting pressure from higher fuel, food and utility prices. As a result, profitability continued to decline for the ninth consecutive period.

Today's figures come after PMI data from the manufacturing sector, released at the end of last week, showed a contraction in February. The overall reading for the sector was 47.9, well down from 50.5 in January and indicating a sharp drop in output. New orders for manufacturers fell for the second consecutive month and at the fastest rate since last July, constrained by tough domestic and overseas market conditions. Although cost pressures eased marginally this month, manufacturers cited the recent depreciation of sterling as producing upward pressure on the cost of their imports. In addition, PMI results released yesterday on the construction sector saw a steep decline in output in February, due to falling levels of commercial building and civil engineering work.

Although February's manufacturing and construction results were disappointing, the Markit/CIPS composite PMI indicator for the UK points to a marginal expansion in January and February for the economy as a whole. The economic outlook remains under significant pressure from squeezed real incomes, government austerity and an ailing eurozone, but the latest data continues to suggest that a fall back into technical recession will just about be avoided in Q1 2013.