In July last year, several fuel retailing businesses contacted ACAPMA to advise that they had been refused asset finance for the replacement of pumps and forecourt infrastructure that had been damaged during the recent flood events in Eastern Australia.
One of these retailers advised that all four of the ‘Big Banks’ had told him that they were no longer providing asset financing products for fuel assets given ‘a change in corporate financing policy.’ The retailer took that to mean avoiding support of investment in the fossil fuel industry.
“The business was, however, offered alternative and higher cost finance products that required the business to provide additional security and involved a significant change in his existing banking arrangements – an offer that he politely declined,” said ACAPMA CEO Mark McKenzie.
Asset financing is attractive to asset rich business, like fuel businesses, as it allows these businesses to secure the loan against the asset being purchased. Accordingly, asset financing products tend to be attractive to fuel businesses as they do not impact their existing businesses banking arrangements.
Fuel businesses typically use this form of finance to fund purchases of new forecourt assets, new workshop equipment (such as hoists and diagnostic equipment), and/or to finance shop upgrades (e.g. point of sale systems, refrigeration cabinets and kitchen equipment). Facilities for standard assets like cars and trucks are also readily available.
But, as the saying goes, ‘when one door closes, another often opens.’
In recent months, ACAPMA has been working members of the Australian Asset Finance Broking Industry to better understand what alternatives to ‘Big 4 Banks’ financing might be available to a fuel business seeking an asset financing product.
“Thankfully, it seems that there are numerous alternatives for businesses that have been refused access to asset financing products by the ‘Big 4’ Banks”, said Mark.
“There are numerous second tier financiers that are available to provide competitively priced asset financing products for Australian fuel businesses,” said David Gandolfo (former President of the Commercial Asset Finance Brokers Association and Co-founder of Quantum Business Finance).
David Gandolfo is no stranger to the fuel industry. He has worked closely with ACAPMA over the past five years on a range of asset financing issues in his former capacity as President of the Commercial Asset Finance Brokers Association (CAFBA). David also presented at the 2018 Asia Pacific Fuel Industry Forum (Auckland) and has a first-hand knowledge of the challenges that fuel business face in securing finance for forecourt infrastructure and shop fit outs alike.
In the last six months, David and his team at Quantum Business Finance have worked with ACAPMA to create a very simply referral process for members wanting to secure asset finance. This work has resulted in the establishment of an information page on the ACAPMA website that introduces the services of Quantum Business Finance and includes a link to a contact form that is directly transmitted to Quantum Business Finance.
“Our role is not to interfere in the business or financing arrangements of our members. Rather, we just wanted to provide an additional option for member businesses that may be encountering difficulty in securing asset finance, by putting them in touch with someone who could help,” said Mark.
“ACAPMA receives no remuneration from any referrals. Once the member clicks ‘send’ on the website contact form, the rest is left to the member business and Quantum Business Finance to progress as they both see fit,” concluded Mark.
ACAPMA members who are interested in the asset finance option or want to learn how David and the team at Quantum Business Finance may be able to help, should visit the ACAPMA Home Page and click on the ‘Quantum Business Finance’ logo. Or simply click Quantum Business Finance – ACAPMA.
ACAPMA
Source: https://acapmag.com.au/2023/01/another-option-for-asset-financing/.
