Bluestone’s Q3 Market Update by Richard Tamlyn


Hi there,

I’m Richard Tamlyn and this is Bluestone’s Q3 update for 2021.

Well, we’re out of lockdown – freedom day has arrived and whilst there’s an air of caution, the country is slowly emerging from one of the toughest 18 months in history.

We’ve helped hundreds of businesses remain liquid over lockdown but the last quarter has seen a definite shift in focus with more and more businesses now looking to the future, and activating projects that have been delayed or put on the back burner during lockdown.

April saw a massive backlog of applications for the CBILS loan scheme prior to the government deadline of 31st March. As funders dealt with that, there was a delay to the launch of the Recovery Loan Scheme scheduled by the chancellor to go live on 6th April. The RLS is a government backed loan scheme designed to help businesses bounce back, but in reality it’s been a bit of a damp squib. The Financial Times reported at the end of April that uptake had been 75% down compared to the Bounce Back Loan launched earlier in the pandemic.

Whilst there was a lot of concern and criticism of the government for the scheme’s complexity and higher interest rates, the reality is probably that businesses had borrowed heavily and adequately enough from the initial schemes, and the furlough scheme helped businesses manage their cost base effectively, so maybe the government don’t deserve quite as much criticism as thought?

Whilst many finance applications are complex, here at Bluestone we take all of that away and work with you to coach you through the process and ensure your application is positioned correctly and with as much chance of approval as possible, so if you do need assistance give us a call or follow the link below.

And the slow uptake of the RLS isn’t the only indicator that businesses have weathered the Covid storm in a pretty resilient way. The influx of cash from CBILS has also seen a slowdown in uptake of our other cashflow solutions. Invoice finance, VAT and tax loan uptake are also down across the board, possibly due to the reduction in production and turnover during lockdown, but as businesses look to build back after lockdown and get back in to growth phases, these types of solutions come into their own to unlock capital for marketing, recruitment and other essential costs in the business that enable the growth UK plc is in need of. Give us a call if you’d like to learn more.

The chancellor’s budget has created a real shift in terms of businesses approach to finance and we’ve been recommending many more Hire Purchase agreements to ensure businesses can unlock the super deduction tax savings. That saving means businesses can offset 130% of the value of qualifying assets against their corporation tax bill, an unprecedented move by Rishi Sunak to encourage investment and kick start the business economy post lockdown. HP enables the super deduction savings in year one whilst also being able to spread the payments and keep capital in the business so it’s a great way for businesses to get projects moving in a really cost effective manner.

But alongside that, the corporation tax increase from 1st April 2023 is making leasing an even more attractive proposition. We’re working with a number of PLCs from sectors like big pharma and communications who are now looking at leasing on large scale projects because the Corp tax increase makes leasing a no brainer. For any projects commencing in 2022, spread over 5 years will mean business can recoup 25% of their annual lease payments by offsetting them against corporation tax. On any project ,that’s a gamechanger and more than ever makes leasing the most logical option…definitely not just for businesses who “can’t afford to pay cash”.

So whilst the hike in corporation tax may not be great news for businesses it does make investments more affordable than ever.

We’ve also seen a massive increase in demand for green energy solutions this year. More and more businesses are looking to become more carbon neutral, reduce operating costs and generally become more efficient and environmentally friendly. Whether you’re moving your fleet to electric vehicles, looking to reduce utility costs through solar, LED Lighting or biomass boilers, finance is an absolute no brainer. The savings made from day one often offset the costs of finance meaning you can make the move to being a greener business for a net neutral cost, or in some cases a cash generative position from day one. We work with a number of suppliers in the sector we can recommend, or if you’re already working with a supplier and just want to enquire about financing your project get in touch. We’ll produce some finance models for you based on the forecast savings you’ve been provided with and see just how effective financing your green revolution can be.

Lastly, we’re delighted to have been nominated again in the NACFB Awards’ Finance Broker of the Year category. We won the award last year and it’s fantastic to be recognised for our work in what’s been a turbulent, fast changing and challenging year for the finance sector. Like all things Bluestone, we’ve approached it objectively, ensuring we’ve always put our partners and customers interests at the heart of every change we’ve made to adapt, and making sure we do all we can to look after our brilliant team through what’s been a tough year both in work and out of it.

The changes keep coming but we look forward to helping you build back stronger and making sure your financial strategy is as effective as it can be in delivering your business back to growth.

Thanks for your time, I look forward to seeing you soon.

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