The asset finance provider's managing director Alexander Baldock tells us what Lombard can do for growth businesses
Founded: 1861 as the North Central Wagon & Finance Company.
Based: Head office in Redhill, Surrey, with business centres located throughout the UK.
Who are you?
Alexander Baldock, MD of Lombard
What do you do?
We provide asset finance for British businesses across a number of industries.
What does that mean in practice?
Through providing asset finance we help companies buy or rent equipment through hire purchase and leasing. Whenever businesses invest in tangible assets, anything from office equipment to plant and machinery, or from commercial vehicles to planes or boats, they usually need an affordable and secure means of finance. By providing the means for a company to invest in capital equipment we present them with the opportunity to expand.
What size company suits you?
Businesses of all sizes can use asset finance.
Why should I care?
In the recent recession, many businesses postponed acquiring new assets. We saw capital expenditure fall by over 30% in late 2007 and early 2008, which meant many companies were possibly using out-dated or ineffective equipment which in the long run is costly and unproductive.
What can you do for me that i can’t do for myself?
By employing a number of in-house cross-sector specialists Lombard is able to apply understanding of specific markets and industries. We also understand how business requirements change in different stages of the economic cycle and tend to see these changes earlier than most organisations. We also work in partnership with the NatWest/RBS banking teams to provide complete financial solutions to suit business’ needs.
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What mistake will you stop me from making?
Alternative forms of credit are increasingly important in an economic downturn, yet asset finance is often overlooked as a tool for unlocking capital expenditure. It is a great way to strengthen the balance sheet and provide liquidity. The Finance & Leasing Association (FLA) has quoted that asset finance is now the third most common source of business financing, and that almost one fifth of UK small and medium sized businesses have used leasing to fund capital equipment.
Can you give me an example?
There are seven core benefits that asset finance provides businesses:
1. It releases tied-up cash – you will avoid having to draw on cash reserves that may be needed elsewhere.
2. It opens credit lines by acting as an extra facility that uses the financial value of a business’ assets to complement cash resources and existing bank credit lines, such as overdraft facilities.
3. It minimises ownership risks – we take the risk on how much value remains in the asset at the end of the contract, taking responsibility for the disposal and management costs associated with ownership. Therefore you only pay for the asset as long as you use it.
4. It is flexible – it allows a business to fund almost any tangible business asset, including specialist assets.
5. Fixed costs eliminate uncertainty – as the rental on the asset and the payable interest is fixed, it helps businesses plan for the future by eliminating uncertainty.
6. Funds are delivered quickly and efficiently – when an asset finance company is finding the best solution, it shouldn’t need to look for security as it is already being funded. This speeds up the process and enables you to acquire business-critical assets when you need them most.
7. It speeds up credit decisions – our application process focuses on the assets we are funding, therefore our credit decision process is fast and standardised.
Why should I trust you?
Our long-term relationships with customers exist because they trust us to support them – we believe customers embarking on a contract need to know that both the deal and the funding organisation will be there in the bad times as well as the good.
How much does it cost?
Our solutions are not off-the-shelf. We look at the client’s specific requirements and objectives and tailor a financing solution accordingly.