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This week, Bibby Financial Services’ Corporate Sales Director, Kevin Craven, shares his views on the opportunities and challenges facing UK businesses with turnover greater than £5m.

Kevin Craven

Businesses with a turnover of £5m+ have been an important catalyst of growth over the last decade.

As the ‘M’ in SME, these businesses have increased in their numbers, diversifying their space in the market and demanding new funding streams from providers.

They have established themselves as pivotal to the stability of the wider UK economy and shown that they are better placed than many others to cope with changes in the economic landscape.

Yet despite their strength, such businesses are faced with a number of unique challenges which the Corporate Finance team at Bibby have been seeking to respond to.

Growing pains

Having the capacity to deal with fast growth can be a destabilising challenge for many businesses with £5m+ turnover. Although growth is seen to be a positive outcome of good business, it does raise its own challenges. For these businesses, the ability to adapt to fast growth, whilst maintaining quality services on a larger scale, can result in growing pains.

With growth comes the challenge of having access to the right kind and level of funding. As these businesses experience growth which surpasses the expectations of initial funding terms, they must seek out new financing avenues.

While many businesses have been successful, there are those that are still suffering from years of economic uncertainty and lower sales levels. Indeed, looking to new markets both at home and overseas might open up untapped opportunities and provide new avenues of growth. But again – this requires having the right kind and amount of funding.

To take on new contracts, buy stock, recruit and expand into overseas markets, businesses need to look to sustainable sources of finance to fulfil their growth ambitions.

Partners for growth

In spite of the importance of this sector, the £5m+ sector is not served as well as it could be by the wider finance industry, with funders often failing to offer truly tailored, personalised funding solutions to businesses of this size. Instead, they often look to repackage funding types for much smaller or much larger businesses.

Our Corporate Finance team takes a different approach to funding these businesses. It starts with consideration of their requirements and works backwards to find a solution. This enables us to unlock working capital for different scenarios, as opposed to trying to shoehorn businesses into a particular product type.

The team supports businesses throughout all stages of their product lifecycle funding growth and expansion, management buy ins and buy outs, refinancing, corporate restructuring, mergers and acquisitions.

Fantastic examples of our corporate financing capability for clients such as Turtle Wax and Ripmax can be found on the Daily Telegraph website here.

Alternatively, intermediaries and businesses alike can contact our Corporate Finance team on 0800 91 95 92.