Inventory Finance

Keep your business stock levels high & up-to-date through inventory finance.

Rates from 8%
From £20,000 to £3m
Typically available within 48 hours

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Understanding Inventory Finance

Inventory finance, also known as warehouse financing or stock loans, is a short-term business loan that enables businesses to purchase inventory without depleting their cash reserves. By using the inventory itself as collateral, companies can secure the necessary capital to maintain optimal stock levels, meet customer demand, and support growth opportunities.

Inventory finance is a form of asset finance, and often comes in two types:

Inventory Line of Credit: Also known as a “revolving lines of credit”, this credit facility allows businesses to borrow up to a certain limit, repay, and borrow again as needed.
Floor Plan Financing: Commonly used in industries like automotive sales, this involves a lender providing funds to purchase high-cost inventory items.

This financing method is particularly advantageous for small to medium-sized enterprises (SMEs) aiming to strengthen their inventory. It allows these businesses to:

Maintain Adequate Stock Levels: Ensuring products are available to meet consumer demand, such as enabling retailers or manufacturers to keep up with seasonal demands.
Improve Cash Flow Management: Freeing up working capital for other day-to-day operational needs.
Seize Growth Opportunities: Enabling bulk purchases or expansion into new markets, without harming cash flow.

Will My Business Benefit From Inventory Finance?

Inventory finance is particularly beneficial for businesses that maintain substantial stock, such as retailers, wholesalers, and manufacturers. However, inventory finance is not limited to these sectors; it is suitable for any business that holds stock as a significant part of its operations.

For example, a mid-size camping retailer is struggling to stock enough inventory for the summer holiday season. As a result, they are losing sales due to a constricted cash flow. By using inventory finance, the retailer secures a £150,000 line of credit using their stock as collateral. This enables them to buy in bulk without depleting working capital, increasing their sales growth and cash flow stability.

Benefits of Our Inventory Finance

There are several benefits of working with our brokers to secure inventory finance, including:

Improved cash flow management.
Flexibility to meet seasonal demand or bulk purchases.
Access to capital to keep inventory levels high.
Frees up funds tied up in inventory.
Fast approval and disbursement of funds.
Available and suitable for a wide variety of industries.

Key Features of Our Inventory Finance

At Union Business Finance, our brokers work hard to secure the best rates from lenders offering inventory finance. Key features of this service include:

Finance is secured against the value of the inventory.
Interest rates from 8%.
Access to funding in as little as 48 hours.
£0 deposit.
Shorter repayment periods.
Access from £20,000 to £3m.
Secured borrowing options are available.
Tailored solutions based on your businesses’ needs

Eligibility Requirements

To be eligible for this form of finance, there are several boxes you’ll need to tick:

Must be based in the UK.
Must be a homeowner.
Must have a minimum trading length of 6 months.
Must have a good credit score (business and personal).
Must not be in financial difficulty.
Must be for business purposes only.

Why Choose Union Business Finance?

There are several reasons why businesses choose us to secure the best rates for their finance solutions, including:

Access to Wide Range of Lenders: Our brokers have access to over 100+ lenders, meaning we’ll find the best for your business requirements.
We’ll Get to Know Your Business: We want to form long-term partnerships with each and every business we work with, becoming your go-to broker.
Simple Application Process: We want it to be as easy as possible to secure vital finance, so our application process is designed with simplicity in mind.
Expert Guidance: We have over 10 years of experience working with over 4,000 clients from different industries, providing expert advice that drives your business forward.

How Can I Apply?

We understand that there are many time-consuming activities associated with running a business, and we don’t want securing finance to add to that. Therefore, our application process is as simple as possible - as easy as one, two, three!

Submitting an Application: Help us get to know your business - what do you intend on using the loan for? What are your goals? This key information, along with the required documents, can help us tailor finance solutions to your needs.
Reviewing Application: We’ll review your application promptly, assessing your business plan, loan suitability, and any extra considerations. You’ll typically hear back from us within 48 hours.
Receive Funds: Once we’ve approved your application and the contract has been signed, we’ll provide you with the funds and you can start purchasing more stock for your inventory!

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FAQs

What types of inventory can be financed?

Inventory finance typically covers items such as:

Finished goods ready for resale (e.g. retail products).
Raw materials used in manufacturing processes.
Components or parts required for assembling finished goods.

How much inventory finance can I get?

The amount you can borrow is usually tied to the liquidation value (LV) of your inventory, often ranging from 50% to 80% of its wholesale value. The exact figure depends on:

The type and quality of the inventory.
Your business’s financial health.
The lender's terms.

What alternative forms of finance are similar?

In some cases, our brokers will decide that other forms of finance are better suited to your business needs. If this is the case, we’ll let you know as early as possible.

For example, asset-based lending (ABL), which uses various business assets as collateral, might be more suitable. Alternatively, invoice finance, which provides funding against unpaid customer invoices, is another common alternative.

Is inventory finance the same as invoice finance?

No. Whilst both are collateral-based forms of finance, they service different business needs:

For inventory finance, funds are secured against inventory to help purchase stock.
For invoice finance, cash is advanced based on unpaid invoices to improve cash flow

Are there any disadvantages to stock loans?

Potentially; if inventory doesn’t sell as expected, repayments can strain cash flow, and lenders may seize inventory used as collateral. Additionally, high interest rates can reduce your profit margins.

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Disclaimer

Aintu Ltd T/A Union Business Finance is an independent Asset finance broker not a lender, as such we can introduce you to a wide range of finance providers depending on your requirements and circumstances. We are not independent financial advisors and so are unable to provide you with independent financial advice. Aintu Ltd T/A Union Business Finance will receive payment(s) or other benefit from the finance provider if you decide to enter into an agreement with them. Aintu Ltd T/A Union Business Finance is an appointed representative of AFS Compliance Ltd which is authorised and regulated by the Financial Conduct Authority under number 625035. Aintu Ltd T/A Union Business Finance aims to provide our customers with the highest standards of service. If our service fails to meet your requirements and you would like to report a complaint; please click on the link below;

https://www.afsuk.com/asset-finance-solutions/contact/complaints-procedure/