- 16 Mar
Funding Growth By Acquistion
We have just helped an existing client complete his second company acquisition within his sector, aided by using a factoring facility.
This time he was able to purchase a company twice the size of his previous acquisition, resulting in a dramatic increase in the volume of turnover that his group will achieve over the course of the next year.
Call Sean on 03330 113622 to discuss your funding needs.
Growing by acquiring other businesses within your sector is one way to achieve growth, and if you purchase a large concern, it can enable a step change in the volume of turnover that you transact.
Expansion can be difficult to achieve when the economy is only set to rise by less than a few percentage points each year. The other impacts on the UK economy, such as Brexit uncertainty, the recent election and now the hysteria over novel coronavirus are also taking their toll on the rate at which GDP (Gross Domestic Product - a measure of economic output) is set to increase within the UK. In these circumstances, taking over another business in the same, or an allied sector, can present a quick opportunity for expansion.
Economies of scale may also be possible following a business purchase, whereby duplicated costs can be removed or shared, whilst maintaining the same level of sales income.
Other Ways Of Growing A Business
There are other methods of growing your business, which are explained in our free: Guide to Business Growth but rapid expansion can be achieved by adding other established businesses to your organisation. It may be that you acquire just the trade, or the entire business entity.
Funding Growth By Acquisition
There are many different ways of financing and funding growth by acquisition, these can include using your own money, that of investors, or borrowing from banks and similar entities.
However, acquisition invoice factoring is a simple and freely available option, that can help generate the purchase price, or help you pay deferred consideration. Equally, this type of funding line can improve the working capital position of the acquired company, rather than just meeting the costs of the company purchase.