In New Zealand, it is not uncommon for small and medium sized businesses to have to wait out 30, 60 or even 90 day payment terms to see revenue flowing into their business.
These generous payment terms allow for strong customer relationships. But it can make preparing for seasonal fluctuations in demand difficult. From being able to hire more labour to cope with the increased demand to having sufficient inventory to maintain operations, without access to working capital, cash flow could hold back your business.
That’s why Invoice Finance from ScotPac is a critical business finance solution for SMEs across New Zealand.
What Is Invoice Finance for Seasonal Demand?
Invoice Finance provides small businesses with an advance on the cash owed to them from customers. It leverages the unpaid invoices and ensures access to working capital within 24 hours of approved application.
- Access up to 85% of the value of your invoices upfront
- Collect the balance, less fees, once invoices are paid
- Scale your facility in line with your sales
- No property required as security
- Choose from self-managed and full-service models
How Does Invoice Finance Bridge Inventory Gaps and Labour Hire Pre-Holidays?
Invoice Finance is particularly useful for volatile holiday cycles. If your business operates in an industry prone to seasonal fluctuations in demand, it can be difficult having enough cash on hand at the end of the slow season to invest for the busy season.
- This means there will be inventory and stock gaps ahead of the holidays
- This means you may not be able to hire adequate labour to deal with the demand
Invoice Finance allows SMEs to free up the capital owed to them in unpaid invoices to cover not just ongoing operational expenditure but prepare for the peak periods of business:
- Buy required stock and inventory
- Invest in uniforms, tools and safety gear
- Cover payroll and new labour hire
- Benefit from early and bulk buy discounts
- Prepare for pre-holiday gaps in cash flow
- Avoid shortages
Why Use Invoice Finance for Preparing for the Holidays?
ScotPac offers a number of business working capital solutions.
However, Invoice Finance provides some unique benefits:
- It can be tailored to fit all your specific business needs
- Access funds in as little as 24 hours
- Scale your facility up to $150 million as your business grows
- Avoid taking on debt and using your property or assets as security
Invoice Finance ensures that your weekly wages and stock orders can continue uninterrupted.
How does Invoice Finance work?
Application Process
With ScotPac, the application process can be completed entirely online and within just 5 minutes.
To be eligible:
- Your company will need to be selling goods or services to other businesses on standard trade credit terms.
- You will need to have a minimum of 6 months in operation, with consistent invoicing and collections.
- Your customers will need to be creditworthy and New Zealand based businesses.
- Your business will need to turnover a minimum of $10,000 in invoices per month.
- You will need to be registered and operating in New Zealand.
Accessing Funds
Once you are approved, to access an advance on working capital simply submit the invoices that are still outstanding.
The lending team will assess the debtors and provide up to 85% of the value of those invoices upfront.
No need for lengthy bank waits.
No need for red tape and paperwork.
Once approved, you will have access to the working capital you need to hire more labour or order more stock. Then, when your customer has paid their invoices, you will receive the remaining balance of funds, less the associated facility fees.
What Inventory and Labour Hire can Invoice Finance Fund Before Holidays?
Unlike some other forms of business finance, such as some traditional bank loans, Invoice Finance provides funding for flexible business use.
That means you can spend it on the inventory and stock or labour hire needs required for your business ahead of the holidays.
- Replenish stock
- Purchase PPE
- Buy uniforms
- Upgrade tools
- Invest in vehicles and machinery
When you are facing a pre-holiday season, it can be difficult to cover the bulk orders and labour hire requirements needed to prepare for the uptick in demand. With Invoice Finance you maintain control of your cash flow, ensuring that the cash coming into your business and the cash flowing out again are aligned.
How Does Invoice Finance Handle 30-90 Day Delays in Labour Hire Payments?
Small New Zealand businesses are often faced with the trade-off of maintaining good relationships with their customers by extending generous payment terms and the reality of requiring prompt payment.
Invoice Finance provides advanced cash to your business regardless of the terms offered, ensuring the best of both worlds.
Importantly, unlike a lump-sum cash injection as part of a business loan, the size of your Invoice Finance facility is a function of your turnover. In other words, as your business grows from year to year, you are able to access more funding in line with your increased invoices’ value.
What Makes ScotPac Invoice Finance Ideal for Kiwi Businesses?
If you operate in a labour-intensive sector or require significant amounts of stock to be kept on hand, Invoice Finance gives you the ability and control to do both.
It’s fast, flexible funding to help you grow your business.
At ScotPac, we’ve made the process fast and easy including our custom lending specialist consultations, fast and online eligibility check, and the ongoing support required to ensure you’re assisted every step of the way.
Why ScotPac for your Invoice Finance
There are many reasons to use ScotPac for your Invoice Finance needs.
Our expertise working with SMEs means we know how to help Kiwi businesses prepare for labour hire shortages and bridge inventory gaps pre-holidays. And we’ve been providing business working capital for over 35 years.
We currently support over 9,300 businesses, fund $26.3 billion annually and are the largest non-banking lender across New Zealand and Australia.
So, if you are looking for the right solution to prepare for the holiday season madness, make sure to apply for Invoice Finance in New Zealand with ScotPac today.
