The number of businesses using sale and leaseback is now four times higher than it was before the coronavirus pandemic, with experts attributing the growth to a change in profile of vehicle users.
As companies try to improve their liquidity, an increasing number of fleet managers do not want cash tied up in assets on their balance sheet and have realised these vehicles provide an opportunity to raising finance.
Sale and leaseback enables companies to have full use of an asset without the burden of ownership. It’s a straight-forward solution where an asset is sold to a financier, such as Close Brothers Vehicle Hire, and a firm leases it back over a pre-agreed period and price.
The cash flow benefits that this type of finance provides is likely a key reason that there has been a growth in users in recent months. By releasing equity from a vehicle fleet, this leasing solution can release cash back into the business and improve liquidity.
Similarly, sale and leaseback solutions can provide quick working capital relief. The immediate working capital injection it creates is often used to support day-to-day operations and strategic commercial decisions, such as completing an acquisition or simply achieving corporate growth.
As some companies restructure their business models for the future, sale and leaseback can provide both the funding and flexibility they need to achieve their long-term goals. We also give the option to consolidate agreements with different lenders into a single payment to streamline the firm’s outgoings, making budgets easier to manage.
It can also be tailored around a company’s individual assets, such as a vehicle or fleet of vehicles. This enables a business to respond to the market’s changing conditions and manage their operations more efficiently.
To find out more about how sale and leaseback can give an immediate cash injection, complete an enquiry form on our website or call us today on 08082 963 344.