Case Study

IT Equipment Finance

Company —
Internet Provider
Business Type —
Broadband Services Provider
Requirement —
Fund to expand network coverage
Solution —
Asset Finance

Broadband Provider Expands Network Coverage through Strategic Finance

See how a leading provider of high-speed broadband and communication solutions, serving both rural and urban communities, expands its network coverage through finance.

The Challenge

As the business aimed to expand its broadband network coverage and reach underserved regions, they faced the challenge of securing the necessary resources to invest in advanced equipment. Expanding network coverage required deploying new telecommunication towers and leveraging cutting-edge wireless communication technology. However, these infrastructure upgrades and equipment purchases involved significant upfront costs, which could have strained the company’s financial resources.

Investing in Advanced Equipment

With the support of Portman the business invested in key equipment to enhance their network capabilities. They financed the purchase of telecommunication towers, known for their robust construction and efficient deployment, to expand their network coverage in underserved areas through asset finance. Additionally, they acquired leading wireless communication equipment, renowned for its reliability and high-performance capabilities, to ensure seamless connectivity for their customers.

Benefits and Challenges in the I.T., Technology, and Communications Sectors

Benefits:

  1. Technological Advancement: Investing in advanced equipment and technology allows other IT and technology companies, like this business, to offer cutting-edge solutions, gaining a competitive advantage.

  2. Expanded Service Reach: Expanding network coverage and service reach enhances the company’s customer base, creating new revenue streams and business opportunities.

  3. Customer Satisfaction: Reliable and high-speed connectivity fosters positive customer experiences, leading to increased loyalty and positive word-of-mouth referrals.

  4. Innovation Opportunities: Investment in technology opens doors to innovation, fostering the development of new products and services to meet evolving customer demands.

Challenges:

  1. Capital Intensive: Infrastructure expansion and investment in advanced equipment often require significant upfront capital, posing financial challenges for businesses.

  2. Rapid Technological Changes: The technology sector experiences rapid advancements, necessitating frequent equipment upgrades to remain competitive.

Solving Challenges with Finance

IT and technology finance solutions through Portman provide customised options to address the financial challenges faced by businesses in the sector. Equipment financing allows businesses to spread the cost of infrastructure upgrades and equipment purchases over time, easing the strain on working capital.

Lease options provide flexibility in equipment upgrades, ensuring that businesses can stay at the forefront of technological advancements without the burden of ownership. A standard business loan or hire purchase could also be worth consideration as part of your financial strategy.

Benefits of Investing in New Equipment or Service Expansion for IT and Technology Businesses

  1. Enhanced Capabilities: Upgraded equipment and expanded services enable businesses to offer improved solutions, attracting more customers and fostering growth.

  2. Competitive Edge: Investing in advanced technology and infrastructure strengthens a company’s competitive position in the market, differentiating them from competitors.

  3. Scalability: Expanded network coverage and services create opportunities for scalability, accommodating increased customer demand and business growth.

  4. Industry Leadership: Businesses investing in new equipment demonstrate industry leadership, positioning themselves as reliable and innovative service providers.

Conclusion

By leveraging the benefits of finance, the business successfully expanded its broadband network coverage and upgraded its communication infrastructure. The strategic use of IT and technology finance solutions through Portman allowed them to overcome financial barriers and invest in cutting-edge equipment, solidifying their position as a leading broadband and communication provider.

Furthermore, other IT and technology businesses can capitalise on the benefits of investing in new equipment or service expansion to strengthen their market presence, attract more customers, and drive business growth in the ever-evolving technology and communications sectors.

Partner with Portman, for a successful future

There are plenty of finance options out there for you, deciding which is right for you will take time and consideration. But why should you choose these financing options from Portman?

At Portman Finance Group we are focused on serving the needs of you and your businesses, and have been doing so for thousands of other businesses since 2007, raising over £1 billion in funding for UK SMEs. 

We take the time to truly understand your business and what you need, ensuring we secure the right funding for you. As both a broker and a lender, we can also offer financial options that others cannot. We promise you will have one point of contact from start to end, providing you solutions quickly, sometimes within hours.

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Hire Purchase

Hire purchase usually involves paying the VAT and a deposit up-front. Fixed monthly repayments are then made, affected by whether you pay off the entire loan over the term or chose a final balloon payment. The final option to purchase is guaranteed for a nominal fee, transferring ownership of the asset to the customer.

Hire purchase is well-suited for situations where a company definitely wants to own the item at the end of the term, often where the asset has a significant usable lifespan, a high residual value and will not need to be upgraded.

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Lease Finance

Equipment leasing allows a business to acquire hard or soft assets without the upfront costs associated with large purchases. A lender purchases the item, the business then leases it through fixed monthly payments over an agreed term.

Typically, asset finance is provided for high value ‘hard’ assets such as machinery, equipment, or vehicles, but Portman also arranges asset finance for ‘soft’ assets such as IT, fitness, catering, or vending equipment, as well as premises fit-outs, furniture or even air-conditioning.

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Business Loans

Business loans are a way of borrowing money, which is repaid in monthly instalments, including interest, over an agreed term. Business loans are a common way to help smooth out cashflow fluctuations and take opportunities where otherwise they could be missed due to a lack of working capital.

Business loans can be secured or unsecured. Portman typically provides unsecured loans which can be more flexible and do not require collateral but are likely to require a personal guarantee. Secured loans are tied to an asset which the lender can claim ownership of if repayments are not made, these may be used in equipment refinance deals.

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Start Up Loans

New businesses often need an injection of finance to get them off the ground. Asset finance for new businesses allows you to focus on running your company and bringing in customers, confident that you have the equipment, vehicle or stock you need without the large initial outlay.

Using finance for your equipment means that you preserve the credit card or overdraft for contingency and operating expenses when the unexpected happens.

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Equipment Refinance

If you recently bought a high-value item outright but would now prefer to have financed it, we can help with a sale-and-lease-back agreement. If the item is less than 3m old, give us a copy of the invoice and we will calculate the current value. After a few checks and acceptance of the term and monthly repayments, we can give you the cash equivalent of the invoice to put back into the business. You’ll then make fixed monthly payments including interest, whilst your asset earns you money.

If your business owns high value assets that are not currently on finance, subject to a valuation, it is also possible to use them as security for a loan, with lenders offering a cash loan up to a % of the asset’s value.

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Recovery Loans

Recovery Loans offer an excellent way of making sure your business gets back on its feet after the long-term effects of the pandemic and subsequent supply chain disruption. Businesses with turnovers up to £45m, including those who have previously benefited from the government’s CBILS, BBL or RLS, can apply.

Recovery Loans can be used for any legitimate business purpose or simply to provide cashflow. Rates are capped and the government continues to guarantee 70% of the outstanding balance, giving added security for lenders who are now able to consider finance for businesses who may have previously found it difficult to obtain.

Up to £2m can be borrowed on terms from 2 to 6 years. Your personal private residence cannot be taken as security.

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