Case Studies

Anzeck BiodegradeableMarch 26 2009

They have been trading in the BRADFORD area for over twenty years, and have won a number of awards for their excellent service and the products. Bio Degradable/Anzeck Plastics, who are a UK manufacturer of green packaging solutions to a wide range of industries, suddenly found that their otherwise excellent relationship with the bank had become strained. Some long established clients were beginning to take longer to pay their bills. They had to bulk buy plastic at more expensive prices because the increase in oil was seeing a huge impact on their raw materials costs. All these factors meant that their overdraft facility was now absolutely essential to the business as a life line.
However, the credit crunch hit home when their bank of 15 years decided that they would reduce the overdraft facility and start to charge punitive rates for anything that exceeded the reduced overdraft. Overnight they had £30k sliced from the overdraft and the company was being charged 29% for those amounts that exceeded the now reduced limit on the facility. The bank, despite the new Enterprise Finance Guarantee being available would not consider converting the overdraft into a loan. The company had no debts other than the overdraft and owned buildings valued in excess of £1 million. The owners did not know what to do.
Anzeck Bio degradable approached the Business Enterprise Fund to help in trying to source further finance and in addition consolidate their debt finance. We set about establishing their financial position and as part of an intensive programme of change management, BEF set about restructuring the business as well as their debt; spending many hours putting in place cost reduction programs as well as streamlining their operations.
BEF provided them with a loan of £50k to service the orders that needed to be processed, keeping them under the barrier at which their bank charged these punitive rates. BEF then arranged for their forecasts to be presented a number of other banks all of which offered a facility vastly more appropriate than their current provider.
Although still struggling to find the main stream finance despite, the many Government initiatives available, Bio Degradable /Anzeck are confident of weathering the storm, with orders now being steady.

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