Armstrong’s Fulfilment & Warehousing has found an innovative way of managing its
cashflow and expanding its business – and fixing a leaking roof into the bargain –
thanks to a tailored Invoice Finance facility from Optimum Finance.
Organisation and space optimisation are key pillars in running a successful warehouse
operation. Not only must a facility house enough stock to fulfil its current orders, but it
must also ensure it can accommodate stock for future orders, without exceeding its
demand. And in an online and customer centric industry, consumers often expect
product delivery within 24 hours.
Fulfilling all of these requirements is no easy task. It’s expected that by 2030, 60% of
UK warehousing facilities will be considered unlettable due to non-compliance with
upcoming energy efficiency standards and lack the technological capabilities required to
meet current logistical demand. To combat this issue, many facilities have already moved to new premises. Raising the funds to do so, however, can be a challenge, but in the case of Richard, left, Operations Director at Armstrong’s, it was wholly necessary. The solution is not only helping the family-run business to plug the hole in the rafters, but also cover the gap in cashflow between an invoice being paid and the goods being delivered, helping the business advance towards a sustainable and prosperous future.
With Invoice Finance, he uses his receivables (invoices) as the principal asset against which money can be raised. Optimum Finance pays Armstrong’s Fulfilment & Warehousing an agreed percentage of the invoice value as soon as it is submitted, driving access to liquidity at the point of invoice, as opposed to having to wait. It also delivers an outsourced credit management function.
Richard says that Invoice Finance provided an immediate solution: “We faced the
challenge of holding and distributing stock, and covering the cost of doing so, while
waiting to be paid for our services,” he explains.
“The roof was costing the company £20,000 a month,” he says. “The business model of
bulk storage doesn’t work in the modern era. We’ve swapped our old premises and said
goodbye to the leaky roof to something more modern and compliant with environmental
regulations. With the help of Invoice Finance and an improved cashflow position, we’ve
transformed from a high-stock, low-turnover firm to a low-stock, high-turnover firm –
helping us become more efficient in terms of both time and cost.
“Working with Optimum has enabled us to strengthen our business position and focus
on the future, without the hassle of chasing payments ourselves. Now we can be flexible
in our approach and hold stock that garners the most profit with a financial facility that
grows as we do.
“The support we’ve received from Optimum has helped us enormously,” he explains.
“They quickly understood the unique position of our business and what we needed to
achieve to be more successful. Having the financial flexibility to not only operate, but
focus on the future is an exciting prospect, and critical in our onward business journey.”
