Message from our chairman “Being directly involved within the dry cleaning & laundry industry for the last 30 years allows an invaluable insight into your business and its financial requirements. Our mission is to ensure a flexible and understanding approach to all your financial requirements.” John Hopkinson Managing Director

ARE YOU AT THE TOP OF YOUR GAME?

IF NOT, WHY NOT!!!

8 questions that could change your financial future

• Did you know £7.5 million is spent on dry cleaning & laundry each week?
• Does your shop design set you apart from your competitors?
• Do you use advertising & marketing consultants to promote your business?
• Do you undertake regular financial analysis of your business?
• Do you know how many customers use your services regularly?
• Do you know your market share within your trading area?
• Have you time to develop your business to its full potential?
• Do you maintain a high level of customer loyalty?

If you answered no to more than 50% to the questions your are not running our business at its peak

Industry Statistics                        

The latest statistical information available from Mintel details the number of dry cleaning & launderette businesses established in the UK at around 4,500 which is broken down as follows:

The largest sector in the UK dry cleaning market is independently owned dry cleaning shops. This important sector is presently going through a difficult period in respect of environmental pressure concerning solvent emissions and the need to grow and re-direct their businesses into new areas to increase the services on offer. It is anticipated that over the next 3/5 years there will be the need for re-evaluation for many of these dry cleaning businesses if they are to remain viable. 

The precedence for re-evaluation in the industry has already been established in several EU countries, Germany in particular. At the height of the German dry cleaning industry more than 12,000 shops had been established, servicing a population of around 56 million. Subjected to similar pressures such as the Solvent Emission directive (SED) that are presently affecting the UK industry more than 30% of shops were forced to close, either through the inability to finance new environmentally friendly plant or failing to recognise or accept the need to change.

Although the UK environmental laws and enforcement criteria is not as draconian as in Germany, it is still likely that we will experience a similar levelling of the number of dry cleaning business operating in the UK.

The purpose of this report is an attempt to support and guide the more discerning dry cleaner to focus on the real issues facing the industry today. The availability of clear and precise guidance, explaining viable options to stabilise and grow a dry cleaning business are far and few between.

If action, based on a realistic business plan is put into effect your business could develop into a truly viable asset instead of in most cases a vehicle for employment. 

Industry review

As one of the leading finance providers for the dry cleaning and laundry industry you would expect us to keep our ear to the ground when it comes to industry developments and finance requirements.

Based on information gained from recent research, we are aware that there is real pressure on your industry to invest for the future, ensuring you keep ahead of the game. In particular the following investment areas have been highlighted:

• New dry cleaning machines (compliant to new environmental regulations)
• Laundry equipment (develop extra income)
• Shirt finishing equipment (develop extra income)
• EPOS database systems (develop extra income)
• Shop re-modelling (make your business more appealing)
• Commercial mortgages (buy your freehold, create a real asset)
• Business development (open another branch)

All the above are available from a selection of UK suppliers, many can offer you finance facilities, that’s fine, but are you being offered the best deal?
We have secured £10 million at competitive rates to assist you in developing your business. We are in a position, without obligation, to offer you a pre-agreed credit line enabling you to negotiate the best price with your supplier on the basis of a cash purchase; therefore you will not have to rely on their finance schemes.

We believe suppliers of equipment are expert in their field, but rarely are they also expert in advising you about finance.

When undertaking any type of capital expenditure project you should put yourselves in a “win-win” situation, negotiate the best price on the purchase, BFS will provide you with the best rates and advice on your finance.

Government backed finance for you
Small Firms Loan Guarantee

The Small Firms Loan Guarantee is a vital element for helping businesses achieve ongoing success, making a real difference to those that find it difficult to obtain the necessary finance to grow.

These changes will encourage use of the SFLG by as wide a range of eligible SME’s as possible and through as diverse a range of lenders.

The scheme has been improved for SME’s as follows:

• Expansion of lending limits so a single £250,000 limit applies to all eligible Small and Medium Enterprises (SME’s)
• Raising the turnover limit for all eligible SMEs to £5.6m
• Reserving resources to incentivise a range of new lenders to join the scheme
• Reserving recourses to enable additional SFLG lending by banks that demonstrate a clear focus on high-growth SME’s
• Removing the limit on the level of borrowing that individuals can be associated with (the so called “connected persons” rule), thus centering the lending decision on the quality of the business case, not the previous borrowing history of individuals involved with the business.

The SFLG will be available to sole traders and limited companies about to start in business or that have been trading for under five years. The scheme will enable these groups to obtain finance where the normal security required by the clearing banks is not available. Up to 75% of the advance from the bank is secured by the DTI. The borrower pays the DTI a premium of 2% a year on the outstanding amount of the loan. The commercial aspects of the loan are matters between the borrower and the lender.

Loans are currently available for periods of between two and ten years on sums from £5,000 to £100,000 or (£250,000 if the business has been trading for more than two years). A single ceiling of £250,000 will apply.

95% of dry cleaners do not own the freehold of their premises, why?

Higher LTV commercial mortgages

We are now able to offer a dedicated range of near prime products aimed at borrowers who partially satisfy the criteria required by banking institutions. This is an area of the market that we can now offer rates comparable to high street banks, but with greater flexibility.

Key Highlights

• Loans up to 85% LTV on advances up to £500k. Loans up to 75 LTV on advances up to £1.5m at a margin of 2.5% above libor.
• 3 year interest only period available with balance over 27 years capital and interest.
• No interviews required, just one year’s accounts, 3 months bank statements and clean credit history.

FOR YOUR FREE BUSINESS DEVELOPMENT PACK CALL FREE ON 0800 107 4223