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Helping Black Country Business to Ensure They Have the Best Possible Deal from their Existing Bank

Banking in the 1980s was a straighforward affair; there weren’t really any ‘products’ to speak of. A personal customer could have a current account and a deposit account and a business could have either an overdraft or a loan or both. The bank manager resided in your local branch and could make decisions without dealing with an invisible credit department. This was the way it was for most SME’s in the Black Country.

Now, businesses are faced with a multitude of facilities to finance their working capital. Overdrafts are very hard to come by and products such as Factoring and Invoice Discounting are the default product.  In essence the facilities will release more cash from your debtor book than an overdraft would and there will be less reliance on personal security – enabling the assets of the business to fund the business rather than the assets of the directors supporting the business.

Of course, this comes at a price and Factoring and Invoice Discounting can seem very expensive, especially when the bank may insist on credit insurance too as part of the deal. As a cost of sale, it can seem quite a daunting percentage.

The market however is very competitive and over the last few years, pricing has been driven down, due to fierce competition and the fact that for the banks it is capital efficient, profitable business. If your business hasn’t felt this benefit, you need to ask why.

Changing providers for a better deal can be a daunting process with operational upheaval, don’t let anyone tell you it is easy! It is however no bad thing to want to stick with your existing bank, longevity of relationship counts for a lot in banking.  

It is, however, a fact that a new customer to the bank can get a better deal than an existing loyal customer which, on the face of it, seems unfair, but the reality is that very few businesses have the time or expertise to challenge their existing bank to ensure what they have is market facing and fit for purpose.

SJT Advisory was formed in March by Simon Turner, a career banker who has spent his career structuring working capital facilities for businesses. His aim now is to help businesses ensure that they are getting the right deal at the right price

Simon Turner said ‘there are lots of great businesses in the Black Country who are unnecessarily overawed by their bank. I’ve looked at several cases this year where, in each case, we have maintained the existing bank relationship but struck a much better deal. Everyone has been pleased with the outcome, as the bank would rather keep a client than have to find another one. Financing is a big overhead for any business but generally it is not under as much scrutiny as other overhead lines.

The motto really is that if you don’t ask you won’t get and SJT Advisory is more than happy to assist you with a no cost, no obligation chat. If we think you have a great deal, we’ll tell you. If not we’ll work with you on a contingency basis to improve it. For more information, please contact us on 07746 115189

Last modified on Tuesday, 04 October 2016 10:34

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