Business and Finance


Is there a way to easily fill up whilst getting a good price at the bowser?

In today’s business environment the vast majority of companies live in a world where the prices they charge for their goods and services is very much influenced by pricing pressure of the competitors in their market. Fuel price is just one example and believe it or not, so is finance.

Equipment and Vehicle finance is a heavily contested space with a dozen or so banks and financiers all competing to provide their funds to the market, so it’s just a matter of intelligently accessing this competition.

If finance was fuel it would be easy for business owners to gauge and access the best pricing by simply driving past the myriad of service stations and quickly understanding who has the best price on any particular day. Having worked that out, all they would need to do is pull up to the bowser and fill up.

For many business owners they believe that finance is not that simple. The ability to see prevailing interest rates available across the dozen or so banks and financiers is time-consuming and difficult and the ability to simply pull up and secure the loan uncertain.

To be frank, it is a lot easier than most business owners think. Setting up a platform to benefit from this competition is as easy as engaging an accountant or equipment finance broker. A capable broker will already possess the knowledge and the constant updates to be across all current financier offerings and be your advocate to obtain the right outcomes without you lifting a finger.

Unlike ‘fuel’, whatever you pay for finance is an expense that you will typically incur for the next four to five years so pricing is even more important.

For the majority of businesses a 1 per cent saving in costs has the same bottom line effect as a 10 per cent increase in sales so it’s not the turnover but the leftover that is often the most important area to focus on.

With extremely well priced finance now being approved by many banks and financiers under ‘fast track no financials offerings’ the ability to quickly and easily flow between different lenders and access the right rates at the right times is there to ensure a lower cost for the next four to five years.

That’s probably why over 50 per cent of small businesses (with a turnover of up to $20 million) use equipment finance brokers for a significant amount of their equipment and vehicle finance requirements.

Added to this, in a world where bank managers and account managers seem to change every two years, most equipment finance brokers (who are small businesses themselves) have 10 to 20-year relationships with their clients, so there is no need for business owners to continually tell their story to a revolving door of bank managers.

To put it into the ‘fuel’ vernacular, not only will they secure the fuel at the right price, your broker will not only fill up the vehicle for you, they also clean the windscreen and check the tyres at the same time (that’s the service bit).

Just like any profession or supply arrangement there are good ones and bad ones so you need to ensure you have the right one. Find out what their other clients say on such things as public review sites.

Done well, business owners can find comfort in knowing this significant cost to their business is well contained and well managed.

Perhaps this article will assist some of those remaining 50 per cent of business owners to think about this significant cost and time expense by contemplating finance in the same light as they see ‘fuel’. They are already doing this every year with their Insurance Brokers because they rely on them to obtain the best outcome on this very important expense and coverage.

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