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8 Ways Transport and Logistics Companies Can Make the Most of Asset Finance
As the industry positioned as the core of global supply chains, transport and logistics (T&L) companies are under intense pressure to ensure the equipment and machinery they use represents the very best on offer.
The level of capital investment required to keep competitive in a fierce business sector can put enormous strain on finances, often making the balance between investment to expand against cash flow to maintain operations extremely difficult.
Asset finance provides the solution to the challenges of financial management for transport and logistics companies. Offering the funding needed to obtain the high-value assets that are essential to running T&L businesses, asset finance smooths cash flow and reduces the burden on liquid capital.
With our dedication to helping clients to grow their business, Clifton Private Finance is here to provide support for T&L companies. Read on to discover 8 ways that asset finance can help your transport and logistics business thrive
Smoothing the Supply Chain with Asset Finance
No industry is more suited to leverage the power of asset finance than the transport and logistics sector. With a business that revolves around vehicles and ultra-efficient infrastructure, assets form the very core of T&L business models, and yet it is surprising how under-utilised asset finance is by many in the industry.
Transport and logistics companies stand at the forefront of the shifting change towards true sustainability. Road fleets are upgraded to modern electric or hybrid vehicles, while biofuels, sustainable aviation fuel, and hydrogen cells push forward to provide ecologically responsible alternatives for air and sea freight.
These advances are exciting and important, but also very expensive. Replacing transport vessels requires impressive levels of capital investment, while upgrading the administrative infrastructure in place to support them is also costly.
Asset finance is vital to make these investments possible. Whether you are a SME with a relatively small fleet to provide courier services on a national level, or an international freight operator, the right financial support is needed to enable you to keep the day-to-day running while also expanding and upgrading.
Our specialist asset finance team at Clifton Private Finance have the industry experience you need to develop an ongoing strategy for asset management, drawing on the power of asset finance to provide a flexible solution that ensures you meet all professional needs and compliance obligations.
8 Ways Transport and Logistics Companies Can Make the Most of Asset Finance
1. Vehicle Finance
Not all logistics companies run massive cargo ships. The majority of vehicles for transport and logistics firms are HGVs, vans, and fleet cars; all of which fit neatly into the remit of asset finance.
Financing your vehicles rather than buying them outright provides you with options. Capital is left untouched to support business growth or unexpected needs, while cash flow is supported through low monthly repayments.
Fleet arrangements allow you to manage a large number of vehicles through a single point of contact, giving you the power you need to stay on top of all your vehicles with ease.
Of course, if you are looking to purchase a shiny new ocean liner, speak to a Clifton Private Finance business adviser about high-value marine asset finance.
2. Maintenance and Support
Maintenance contracts provide the peace of mind you need to run your vehicles without worrying should anything happen on the road. With dedicated support, an asset finance arrangement with integrated maintenance will mean that you can rest assured that you will always have a vehicle in place for your need. Repairs are undertaken without delay, and temporary replacement vehicles are quickly arranged to ensure operations are not impacted.
3. Investment in Green Vehicles
Ageing diesel or petrol vehicles should be in line to be replaced. Government and international net-zero targets are of particular importance to those in the T&L industry, where the focus is sharp.
Leasing arrangements can be upgraded at the end of the term, while new vehicles can be prioritised with green considerations at the forefront.
Asset finance provides you with the funding you need to make the switch to environmentally friendly vehicles sooner rather than later, ensuring your business is ready for a cleaner, greener future.
4. Financing Warehouse and Depot Equipment
Warehousing is another core component to T&L and also benefits from comprehensive asset finance. Funding is available for all aspects of warehousing needs, from the purchase of a new forklift, through to installation of essential controlled environment and refrigeration facilities.
5. Short-Term Leasing to Manage Seasonal Peaks
During seasons when demand is high - for example, the Christmas period - there is often a need for more vehicles on the road to meet that demand. Investing in a larger fleet for the long term has major financial implications, with the potential for vans or lorries to spend costly periods unused. Short-term leasing overcomes this challenge, providing additional vehicles for short seasonal periods as needed.
6. Building Better Office Infrastructure
Technology is always improving and logistics companies can benefit greatly from keeping up. Advanced systems that improve GPS tracking for vehicles, goods tracking to provide customers with real-time updates, and AI-assisted mapping to determine the best cost-effective and fuel-efficient routes are only some of the many enhancements over recent years.
Asset finance can upgrade your existing IT hardware and software, giving you access to new technologies and improving your back office support.
Speak to a Clifton Private Finance advisor about securing asset finance for IT infrastructure to bring your business to a modern shine.
7. Improving Energy Efficiency
While many T&L businesses focus on their fuel use and carbon footprint, many miss the impact and savings possible through superior building efficiency. Solar panel installations and HVAC improvements can be invested in through asset finance, meeting ongoing sustainability goals while also lowering ongoing expenses.
8. Leveraging Assets for Expansion Capital
Asset finance can also be used to release equity in existing assets. Asset refinance and asset-based lending are options available for businesses with considerable physical assets looking to raise capital for other uses.
By using your existing fleet as security, you can unlock additional funds to drive growth in your business, investing in other areas for expansion.
Exploring the Range of Asset Finance for Logistics
It’s common to believe that asset finance is limited to vehicle finance only, but that’s simply one facet of a versatile gem. The breadth of asset finance solution extends far beyond simply using it to lease a van, and in the right hands it can propel your business forward.
Specialist asset finance lenders who understand the transport and logistics industry have the experience needed to create bespoke underwriting, taking into consideration your needs and providing a financing solution that is tailored to fit.
With the right partner, you can grow your business confidently, obtaining the equipment, machinery, and other assets that you need to position yourself at the very top of the T&L industry.
Asset Finance with Clifton Private Finance
Clifton Private Finance is a specialist whole-of-market business finance broker. We have established relationships with the diverse market of both traditional and independent asset finance lenders, opening the door for you to obtain the low-cost targeted funding you need to boost your logistics business.
Contact an adviser today to discuss your individual circumstances. Our team will discuss your requirements and the difficulties you have faced so that we can put together a comprehensive plan for effective funding.
We’ll compare lenders and match you to the ones who are the best fit for your actual needs, considering your business position, financial forecasts, and credit history. With access to the whole marketplace of lenders, we can find a deal that will ensure you get the assets you need. Book a free consultation now.
