An SME lender has highlighted brokers' role in helping provide timely access to funding for businesses in need of finance to restock as lockdowns are lifted across the country.
According to research from OnDeck, 36% of SMEs which have successfully secured business finance in the past have used the loan to invest in new stock.
“The COVID-19 lockdowns have had a significant impact on the inventories of many small businesses. Retailers in particular have missed out on almost the entire autumn trading season, and now is the time many need to invest in spring inventory,” explained Robbie Fidler, national broker channel manager for OnDeck Australia.
The same research revealed that one in three SMEs with annual turnover between $500,000 and $5m plan to apply for a business loan in the next 12 months, while the figure rises to 50% for those with annual turnover between $2m and $5m.
“In the current environment, the small business sector may still be experiencing disruptions in supply chains. Adding to the challenge, businesses that have been in hibernation for several months may not have the cashflow to support upfront purchases,” said Fidler.
“This highlights the important role that business finance can play – and the opportunity for brokers to support their SME clients. The sooner a business can rebuild stock levels, the faster it can see a return to more normal revenue flows.”
Further, brokers are well placed to remind their SME clients that small businesses have the opportunity to invest in new capital equipment following the government’s decision to extend the $150,000 instant asset write-off to 31 December 2020.
“As trading activity resumes, SME owners need to focus on taking advantage of every opportunity to rebuild their business – not spending hours applying for finance,” said Fidler.
“The support of a broker can be invaluable to SMEs at this time, especially when coupled with OnDeck’s fast online application process, which is designed to support a timely outcome for SMEs. It can help businesses restock sooner and take advantage of any trade discounts to maximise profit margins, while delivering increased revenue to the SME’s broker.”