I took the family to the Nairn Show at the weekend. If you have never been, it is one of those days that Highland summers are built for: cattle and sheep being judged, vintage tractors doing a slow lap of the main ring, marquees full of baking and handicrafts, and several thousand people who all seem to know each other.
It was a good chance to catch up with a few local suppliers and customers face to face, which is worth more than a fortnight of emails. That is, of course, assuming you can hold a conversation for more than ninety seconds before two small people begin steering you towards the amusements with the quiet determination of a pair of sheepdogs.
Which brings me to my first piece of market research of the day. Hook a duck is now £5 a go. Five pounds. For a plastic duck on a stick. I am in the business of structuring finance so that people can spread the cost of significant purchases over time, and I have to say I have never felt the appeal of it quite so keenly as I did standing at that stall.
The Highlight of the Day
The amusements did not win in the end, because the main event was happening in the field.
The Black Isle Dancing Diggers were doing their display. If you have somehow avoided seeing it, imagine several tonnes of construction plant performing a choreographed routine with rather more grace than you would expect from something designed to dig a trench.
For my son, this was the event of the year. He watched the whole thing with his arm out, pointing, providing running commentary to anyone within earshot on exactly which machine was which.
And that is genuinely where this blog post started, because watching a four year old identify machinery faster than most adults in the crowd got me thinking about a word that gets thrown around a great deal in my industry.
A Fair Question About the Word "Expert"
Look at the websites of asset finance companies and you will find the same promise almost everywhere. Industry experts in transport. Industry experts in construction. Industry experts in recycling, in agriculture, in haulage.
It looks reassuring. It is meant to.
But it is worth asking what the word is actually doing in that sentence. In most cases it describes the desk somebody sits at and the assets that cross it most often. Someone in the construction team sees a lot of excavators, so they become the construction expert. That is a specialism of sorts, and there is nothing dishonest about it, but "expert" is a considerable claim to attach to it.
Could the construction expert operate your crane? Could they drive your dumper? Could they take a backhoe out into a field in front of a few thousand people and make it dance?
Could the agriculture expert milk your cow? Plough your field? Work out, without assistance, how to start your tractor?
I am going to go out on a limb here and say no.
What We Actually Claim To Be Expert In
We are not experts in operating plant. We have never pretended to be. If you handed me the keys to a telehandler, the sensible thing for everyone present would be to stand well back and film it.
What we are expert in is finance.
We know how to refinance a fleet of trailers so that capital currently sitting locked up in metal goes back into your bank account where it can do some work. We know how to arrange the right facility to buy a van, and more importantly which of the 120-plus lenders we have access to will actually look favourably at your particular circumstances. We know how to structure a loan so that repayments sit sensibly around a seasonal income.
We understand hire purchase against leasing, and when each one genuinely suits a business rather than merely suiting the person selling it. We understand what a lender is looking at when it reviews your accounts, and what can be done about it in advance if the picture is less flattering than the reality.
That is the expertise. It is narrower than "we understand your industry", and it is a great deal more useful, because it is true.
Meanwhile, You Stick To What You Are Expert In
The flip side is that you are the expert on your own business, and the time you spend chasing finance is time taken away from that.
You know your machines, your margins, your customers and your season. You know which piece of equipment is costing you money sitting idle and which one would pay for itself inside a year. Nobody at a finance company knows your business better than you do, and any of them who suggest otherwise should be treated with some caution.
So the arrangement we would propose is a simple one. You concentrate on running the business. We will concentrate on the funding, and we will do it from Inverness, on the phone, from people you can actually get hold of.
We Do Keep Up To Date, Mind
None of the above should be taken to mean we are ignorant about the assets we fund. Knowing the difference between a three tonne and a five tonne excavator, understanding what residual values actually do over a finance term, and knowing which makes and models lenders are comfortable with, that all matters enormously when you are structuring a deal. It is part of the job and we take it seriously.
We simply keep the claim proportionate to the reality.
It also helps that we have a resident construction industry expert who provides regular training sessions, entirely unprompted, at volume, on every journey we take past a building site. He kept Alana right on product knowledge for the whole of the Nairn Show. It is fair to say she is considerably better at finance than she is at identifying diggers, but she is working on it, and she has a patient tutor.
If You Are Looking At An Asset This Year
If there is a piece of equipment you have been putting off, or capital sitting tied up in machinery you already own, that is a conversation worth having before the year gets away from you.
We are an independent commercial finance brokerage based in Inverness, working with businesses across the Highlands and the rest of Scotland. We have access to more than 120 lenders, and we will tell you honestly if what you are asking for is not the right move.
Call us on 01463 652653 or email directors@mackenziecf.co.uk. We will leave the digger dancing to the professionals.
Frequently asked questions
These answers are general information only. Any actual finance offer depends on a full proposal and credit underwriting by the lender, and is not case-specific.
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This article contains the personal opinions and observations of the author, based on experience as a commercial finance broker. It is for general information only and does not constitute financial advice. Individual circumstances vary and any finance decision should be based on your own situation.
