Sole trader/business startup loans/grants?

[Treetom15]

As the title suggests….

I’ve taken the decision to go on my own, I’ve been a sole trader along side being employed for 3 years but this will be my first full financial year self employed. 
 

I’ve been looking into small businesses loans/start up loans, only for a small amount but just to fund a few bits to get myself up and running-a chipper mostly! Does anyone have any recommendations or companies that are worth speaking to? I’m sure there was funding for small businesses years ago but I can’t find much help online! TIA 

Edited April 17, 2023 by Treetom15

[eggsarascal]

6 minutes ago, Treetom15 said:

As the title suggests….

I’ve taken the decision to go on my own, I’ve been a sole trader along side being employed for 3 years but this will be my first full financial year self employed. 
 

I’ve been looking into small businesses loans/start up loans, only for a small amount but just to fund a few bits to get myself up and running-a chipper mostly! Does anyone have any recommendations or companies that are worth speaking to? I’m sure there was funding for small businesses years ago but I can’t find much help online! TIA 

When I looked into it many years ago you had to have the money/finance to put down on the machine to get any funding for a start-up, things may have changed for the better, I doubt it. My best advice is, keep hold of that contracting work for as long as you can when you’re starting on your own.

[Steve Bullman]

My partner took a startup loan on this scheme. Low rate and government backed. You'll need to submit quite an in-depth business plan but you'll have an assigned account manager to assist you if you get stuck.

 

Start Up Loans - loans for businesses of up to £25,000

WWW.STARTUPLOANS.CO.UK

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Government scheme providing loans for business. Find out if you can use a Start Up Loan to fund your small business.

 

[Treetom15]

Thanks very much Steve, I’ll look into that. Only issue I may have is I’ve been registered as a sole trader for 4 years (only for weeks whilst being employed-for insurance) so not sure whether they will lend as it does say 36 months…No harm in asking though!

[Steve Bullman]

1 hour ago, Treetom15 said:

Thanks very much Steve, I’ll look into that. Only issue I may have is I’ve been registered as a sole trader for 4 years (only for weeks whilst being employed-for insurance) so not sure whether they will lend as it does say 36 months…No harm in asking though!

Not sure how it works to be honest. In my eyes though being self employed doesn’t automatically constitute a business although I may be way off. If you can start with a new business name perhaps that will qualify you 

[doobin]

You don't want a start up loan. You want asset finance secured against a chipper. This will be relatively easy, although rates may not be great currently.

 

Start up loans are high risk- you could spunk the load on advertising and have nothing to show for it. Asset finance is much easier, as the loan is secured against the machinery.

 

Try Peter Benton at Purely Finance. He dealt with my first machine, and I've used him multiple times since. I'm sole trader, not LTD- it makes no odds when talking asset finance for business.

[Treetom15]

21 hours ago, doobin said:

You don't want a start up loan. You want asset finance secured against a chipper. This will be relatively easy, although rates may not be great currently.

 

Start up loans are high risk- you could spunk the load on advertising and have nothing to show for it. Asset finance is much easier, as the loan is secured against the machinery.

 

Try Peter Benton at Purely Finance. He dealt with my first machine, and I've used him multiple times since. I'm sole trader, not LTD- it makes no odds when talking asset finance for business.

That was my thought to start with, but the truck I have bought and the chipper I am going to buy are/were too old to qualify for a finance deal (the truck is 12 years old) 

 

I’ll give Peter a call, thanks for the info! 

[doobin]

1 hour ago, Treetom15 said:

That was my thought to start with, but the truck I have bought and the chipper I am going to buy are/were too old to qualify for a finance deal (the truck is 12 years old) 

 

I’ll give Peter a call, thanks for the info! 

That makes it a lot harder unfortunately. Rates will be astronomical if indeed he can help you.

 

When I was looking for a 2.7t digger, I found a nice Kubota at a reasonable price- £12k from memory. Finance on that at much 'riskier' rates would have worked out at £50 a month less than the brand new £27k Bobcat I bought at their subsidised 0% finance.

 

Have you looked at the economic climate currently? Now is not the time to be buying secondhand, possible unreliable kit at used-car-finance-rates with a base rate higher than we have had for decades.

 

Seriously bud, think again. If you are sure you want to start your own firm now, I'd go with a micro chipper and old transit or LDV owned outright. £1500 for the new chipper and £3k for the old truck. You might work a couple more days a month (to get the job done) than you would with a 6" tow behind, but you wouldn't have that financial noose around your neck in a recession. Have a look at the wee chipper thread- what you will find (if you are smart) is that doing things a little differently can be just as profitable.

 

Another option would be peer-to-peer lending, but again- high interest rates.

[Treetom15]

@doobin I do appreciate the advice. I’m well aware that finance companies don’t like older kit, hence my asking about a small business loan. 
 

Without over sharing my finances, I have enough work to pay for the equipment that is confirmed for the foreseeable future. In reality I’m looking to borrow a small amount (under 10k) the chipper is a friends machine that I know well (and is a very good deal) and the rest is for a tipper back on my current truck.

 

I would happily go down the route of cheap van and chipper, but it wouldn’t be enough to cope with the type of work and workload. 
 

Purely putting the question out there to see if anyone has any pearls of wisdom that I hadn’t come across👍

[dumper]

If you have the work and can prove it talk to a bank you will need a business account anyway, write a plan and see if you can get an appointment always better face to face