Posted: 15 / 03 / 2021
We caught up on Microsoft Teams over a coffee with our Head of Funding in Manchester, Jack Christian to discuss the ever-changing finance landscape and why he thought it was important to use a quality broker when sourcing funding…
Question: How has the financial landscape changed over the time of you working in finance?
“Business finance is a bit like your TV! 20 years ago there were only 4 channels, and now there are hundreds! That is the same with finance, where there were only the 4 main banks lending money not so long ago, now there are literally thousands of options when looking at finance. Also, the relationship between the business owner and his bank manager has changed too. The bank manager used to have the autonomy to make decisions about finance for his clients and the relationship was much closer – they would socialise together and know each other’s families. Over a period of time, that has changed where the bank manager has no sway, looks after 100s of clients and often there is no face-to-face relationship. The change has some positives and negatives. More choice leads to greater competition which leads to improved options but the personal touch has definitely been lost.”
Question: So how has that changed the role of a broker?
“Greater options sound good but it can also lead to confusion and a more complex landscape meaning more time being spent by a business owner to try to find the best option for them, but it’s a bit like trying to find a needle in a haystack. So my role is to bridge the gap between the client’s needs and the 1000s of lenders out there – that involves me going back to the good old banking approach of knowing my clients, their businesses and also their motivators. Understanding their business needs, I can use my expertise to better match a client with the most appropriate lender, utilising the most appropriate “product” whether that be a business loan, invoice finance, asset finance or property finance.”
Question: What would you say to a business owner not using a broker?
“It’s easy for me to say but I think that it is a huge mistake. A few things that I would ask any business owner to consider:-
Time: Do you have the time to really understand the options out there and what is the best match? What is the opportunity cost of that time spent?
Money: There is a myth that brokers mean a more expensive deal. This is not the case, brokers often obtain better rates than are available publicly due to relationship with lenders and volumes. Plus expertise means that finding the best solution, is often the most cost-effective.
Peace of mind: If you find a funding solution yourself by searching your own options or googling, it will very rarely be the best option. That’s just an obvious reality as a broker has significantly more options at my finger-tips. Come and give me a test!”
If you are currently looking at business finance options, feel free to give Jack or the team a call; they could help you to save time, save money and improve your peace of mind!