Client profile:

Premium CBD

As things are rapidly changing throughout 2020, business owners need a helping hand to help them stay in control, and fast.

Pension-led funding (PLF) is a finance solution that helps you, your business, and your pension work together, and through challenging times, that solution could be the difference between surviving and succeeding during COVID-19.

Andrew Armstrong, Director of Premium CBD Limited, said “A large section of our customers were forced to close. This resulted in a huge reduction in orders coupled with a growing amount of aged debt.” Many other business owners found themselves in a similar position, with a need to get through the tough months ahead until their customers could reopen. “In addition, we were already committed to importing quantities of stock that required payment upfront.”

Andrew was seeking to accelerate the growth of their online business, which was enjoying an increase in sales and enquiries during the initial stages of the lock down. They had already reached the concentration limits on their existing invoice financing facility, and it was therefore key to explore additional funding options that could work alongside their existing facilities.

Business owners were encouraged to use Government-backed schemes to help their businesses survive during COVID. Due to such high demand for these schemes, a lot of businesses needed to turn to alternative solutions, such as PLF.

“The much-vaunted government assistance schemes never materialised but wasted valuable chunks of our time and energy,” Andrew said.

“Fortunately, we were already working on a project that required PLF. The funds arrived at the ideal time to plug a serious hole in our cash flow until our customers reopened, placed new orders and paid outstanding bills.”

Senior Financial Adviser, Alan Crook said “As a relatively young business, the company would have struggled to secure additional funding despite their rapidly growing business, particularly during the early stages of the pandemic. Whilst a portion of their pension funds is at risk, there has been no requirement to provide personal guarantees to a 3rd party lender and the interest on the loan is being enjoyed by their own pension funds.

Assuming the continued growth and success of the business, the directors will be able to make additional pension contributions into the scheme, which they may not have otherwise been able to without the initial Pension loan injection.”

Pension-led funding helped Andrew stay in control, whilst many Premium CBD customers were ruled out for a considerable amount of time.

Why else might business owners use PLF?

“The attraction of PLF is that it is the easiest and most cost-beneficial way to finance your own business. You can avoid the pointless time-wasting, excessive fees and interest proposed by mainstream banks or second-tier lenders.” Andrew praised.

Business owners are encouraged to pick up the phone and learn more about Pension-led funding or visit the Pension-led funding contact page as this could be the form of finance that helps you stay in control during tough times.

When discussing the client’s success from using Pension-led funding, Alan Crook said “We managed to secure a £60,000 loan from their pension scheme into their business which was used to help ensure they could meet the growing demand for their products. In turn, the pension scheme is receiving a commercial rate of interest which will assist with their future retirement plans, with security over business assets.”

“PLF marries your favourite borrower to your favourite lender without any nonsense.” Andrew Armstrong