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When a loan is the best route to improving financial resilience

Source: Finance Derivative

Todd Davison, MD of Purbeck Personal Guarantee Insurance

Access to funding is going to make or break many small firms over the next year. While most small firms plan to raise costs and cut energy use based on a recent survey by Purbeck Personal Guarantee Insurance, close to 1 in 3 small business owners (29%) said they are already planning to secure new finance to help manage rising costs.  If speed is of the essence and a loan seems the best route, business owners will need to be prepared to sign a personal guarantee.  This gives the lender a written promise from the owner/manager that they will settle the debt if their business fails. It’s one of the big dilemmas of running your own business.  Sign a personal guarantee and shoulder the burden by putting your home and other personal assets at risk or don’t sign and severely limit your finance options.

Only a third of small business owners know what it means to be a personal guarantor

Aside from the obvious risk of further interest rate increases impacting loan repayments, a big concern highlighted in our survey is that many small business owners could enter into this kind of agreement, without fully understanding the implications – or indeed how to avoid the risk.

We asked 1000 small business owners/managers what it means to be a personal guarantor for a business loan. Across the board, only 33% of business owners answered correctly.  Interestingly, the younger the business, the more clued-up respondents appeared to be over personal guarantees.

Of course young businesses aren’t necessarily run by young people and just to prove that point, 18-24 year old business owners/directors in our survey were the least likely to know what it means to be a personal guarantor while 55-64 year olds were most likely to be more informed.  Perhaps this is not surprising as young business directors are unlikely to have the assets to offer as security but it does also suggest a worrying lack of financial acumen. It might also explain why 25% of small business owners aged 18-24 year old have considered closing their business in the past year compared to just 11% of small business owners in the 45-54 year old age bracket.

So what’s the worst case scenario?

In essence, if a business owner has signed a personal guarantee for a loan and the business defaults on that loan, the director’s home, car and anything in their personal bank account could be used to settle the outstanding debt. If they co-own their home, with a spouse or partner – they will also have to sign the guarantee. In some cases, the personal assets may not be sufficient to cover the debt which means the business owner could even find themselves facing bankruptcy.

How to cut the personal guarantee risk

In such an uncertain economic environment, few businesses can have 100% confidence about how their business will fare over the next twelve or twenty-four months.  Signing a Personal Guarantee is never done with relish but right now that decision is particularly tough.  However, it is vital for the sake of the wider economy that small business owners are both aware of the risks and feel confident about making such a personal decision for the sake of their business.

It is for this reason that Personal Guarantee Insurance is becoming such a key ally in small business finance.  At Purbeck, we saw a 123% year on year increase in PGI secured in Q3 2022.

Personal Guarantee Insurance means if the business does fail, 80% of the loan will be settled by the insurance rather than the business owner’s home, savings and other personal assets being called on to settle the debt.

The level of cover is based on a fixed percentage of the personal guarantee the company director wishes to insure.  This is dependent on whether the corresponding finance facility is secured or unsecured.

Personal Guarantee Insurance also does a lot more than pay out following a claim.  Policyholders are offered access to free mentoring and support services if the business gets into financial distress, plus the huge benefit of expert guidance at the point the debt needs to be settled.

We know that 29% of small firms are looking for extra financial support and while 52% are focused on keeping on an even keel, 38% are planning for growth. Signing a Personal Guarantee can widen options and improve access to finance, including the Government’s Recovery Loan Scheme.

Small businesses have the will, and when a loan is needed, personal guarantee insurance can give them the way.

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Business

Driving UK business growth with AI reskilling, even during economic uncertainty

Alexia Pedersen, SVP International at O’Reilly

Amid ongoing economic challenges, UK businesses are grappling with salary stagnation and limited hiring. Employees, eager to advance their careers, are turning to digital reskilling as a pathway forward. Our latest research found that almost four in five (79%) UK employers have seen staff request digital upskilling opportunities over the last twelve months to strengthen their career prospects, particularly in roles linked to emerging technologies like AI and machine learning (ML).

Our platform has witnessed a surge in demand for learning resources on AI programming (66%), data analysis (59%), and operational AI/ML (54%) learning materials. We’ve also seen an uptick in demand for general AI literacy as IT teams encounter the hallucinations generative AI tools can exhibit.

However, given the accelerated integration of generative AI in most enterprises, the need for general AI literacy has extended beyond IT teams. In fact, 60% of enterprises are expected to have adopted generative AI in some form by the end of this year. Yet, while most business leaders agree their workforces need to be reskilled in GenAI, only 10% of workers are currently trained in GenAI tools. Now, non-technical employees are now seeking reskilling opportunities in AI and ML, cybersecurity, data analysis and programming.

This shift reflects widespread recognition of how emerging technologies can redefine roles and unlock new opportunities. So, how can employers ensure that every employee – not just IT – develops the skills to navigate and leverage AI and other digital tools?

Cultivating a culture of continuous learning

The integration of digital technologies requires more than just adopting the latest tools; it demands a skilled workforce committed to long-term innovation and growth. Businesses deploying AI must prepare every employee to effectively use these tools. Here, a continuous learning approach will ensure that digital transformation benefits the organisation at every level, driving resilience and adaptability within an evolving tech landscape.

Embedding learning in daily workflows, encouraging curiosity, and supporting tailored development initiatives can help achieve this goal. Cross-functional collaboration and knowledge-sharing can help to break down silos, allowing diverse perspectives to be shared amongst teams.

To foster a culture of continuous learning, people teams should emphasise to management the importance of “re-recruiting” to highlight the value of continuously investing in and engaging with talent as consciously as during the hiring process. The best results stem from having an executive sponsor who leads by example, championing learning at all levels. At the same time, employees should feel empowered to take ownership of their own growth, creating a culture where development is an ongoing, shared responsibility between individuals and the organisation.

Joining a company is only the beginning, and sustaining a valuable relationship depends on both the organisation’s support and the employee’s commitment to their own continuous development. To thrive, employees must actively seek out skill-building opportunities and leverage the learning resources available to them. Doing so will help employees remain agile within an evolving technological landscape, while also enhancing their own productivity and contributing to overall organisational success.

Real-time learning

For employees seeking opportunities for personal growth, to bridge the gap between learning and day-to-day responsibilities, employers can harness the ‘in the flow of work’ approach to provide staff with real-time access to quality learning content.

This concept was coined by Josh Bersin to describe a paradigm in which employees learn something new, quickly apply it and return to their work in progress. It’s different from traditional learning approaches like attending a seminar or conference. These learning formats are effective, but many employees simply don’t have the time to devote to them or they prefer to learn at a time that suits them best.  

Instead, it entails providing employees with tools that allow them to quickly find contextually relevant answers to their questions at a time that suits their schedule. Companies can offer ‘in the flow of work’ learning opportunities via an L&D partner to tailor materials to an individual’s unique learning style and objectives.  

This is particularly important not only for young talent who are new to the workforce but also for existing employees who are proactively seeking opportunities to develop their skills and advance their careers. In turn, this approach to workplace learning will increase employee engagement and productivity, fostering innovation and growth that improves the bottom line.

Preparing for the future

As businesses face a rapidly evolving landscape, a continuous learning strategy focused on digital reskilling and upskilling can help them remain competitive. It empowers employees to take charge of their personal growth, fostering a resilient workforce prepared for tomorrow’s challenges.

For companies navigating hiring freezes or budget constraints, prioritising AI literacy and skills development amongst their employees in critical areas such as cybersecurity, cloud, and data analysis can help drive productivity and innovation while ensuring that organisations remain agile during times of technological change. Above all, supporting reskilling today will develop the foundations for a thriving, adaptable workforce ready to face tomorrow’s challenges.

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Business

Freeze-Drying: A Sustainable Solution to Food Insecurity and Waste

By Sverre Puustusmaa, CEO & Founder, Tactical Solutions

The world faces a dual food crisis: widespread insecurity, with over 700 million people going hungry, and massive waste, with nearly 40% of food lost globally each year. This contradiction is staggering, but thankfully innovative technologies are offering hope.

Freeze-drying provides an effective solution to both of these challenges. This process can preserve food for up to 25 years while retaining 97% of its nutritional value, the process addresses critical issues of spoilage and accessibility. Additionally the lightweight, shelf-stable characteristics of freeze-dried food makes it ideal for emergency relief, global aid distribution, and supplying remote regions.

Freeze-drying improves food security and reduces waste by preserving surplus produce for future use. Compared to traditional preservation techniques, the method lowers greenhouse gas emissions and consumes less energy. As population growth and climate change exacerbate global challenges, freeze-drying could be crucial in developing a sustainable and resilient food system.

What is Freeze-Drying?

Freeze-drying is a preservation method that involves first freezing the food, then using a vacuum to remove water through a process called sublimation. Freeze-drying helps retain the food’s nutritional value, preserves its texture and flavor, and extends its shelf life without the need for refrigeration. Unlike traditional dehydration, which uses heat and can degrade both nutrients and taste, freeze-drying results in a lightweight product that is ideal for storage and transport.

Freeze-drying is a versatile process that can be applied to various types of food, including fruits, vegetables, dairy products, and complete meals.

Emergency Relief Support

As food insecurity becomes a growing global challenge, innovative technologies such as freeze-drying offer essential solutions. This method preserves food in a way that maintains the benefits of the original product, effectively bridging the gap between surplus resources and areas facing scarcity. From emergency aid to improvements in long-term supply chains, freeze-drying addresses a wide range of needs in the fight against hunger.

In humanitarian crises caused by natural disasters, conflicts, or pandemics, rapid access to nutritious food is vital. Freeze-dried meals are lightweight, compact, and easy to transport, making them ideal for emergency responses. With the simple addition of water, these meals can provide essential nutritions, even when infrastructure is compromised.

For isolated or underserved regions, where fresh produce is scarce due to logistical challenges, freeze-dried food offers a reliable alternative. Its long shelf life and nutrient retention ensure that communities can access essential vitamins and minerals without dependence on regular supply chains.

Freeze-drying also reduces spoilage during transit, which is especially important when moving food across long distances. Its reduced weight lowers transportation costs, while its durability minimises losses caused by handling and environmental factors.

Addressing the Food Waste Pandemic

Food waste is a major contributor to global greenhouse gas emissions, with approximately 8 – 10% attributed to discarded food. Freeze-drying can play a significant role in reducing this waste by preserving the surplus of food that goes unused everyday. For example, peak harvests that would otherwise go unsold can be processed into freeze-dried products, extending their usability and preventing spoilage.

By requiring no refrigeration during storage or transportation, freeze-dried products significantly reduce energy consumption and associated carbon emissions. These attributes make the technology a key player in building resilient, sustainable food systems.

This approach turns potential waste into a valuable, long-lasting resource. Additionally, freeze-drying uses less energy than methods like canning or freezing, making it a more sustainable choice for large-scale food preservation.

Economically speaking, freeze-drying supports local producers by creating markets for surplus crops that might otherwise be discarded. It also empowers aid organisations by enabling them to stockpile food supplies for future crises, reducing reliance on reactive procurement.

The Future of Freeze-Drying

As the global population is projected to reach 9.8 billion by 2050, the demand for food is expected to increase by 60%. This growing need will require new and innovative approaches to production, preservation, and distribution. Freeze-drying offers a scalable solution that can meet these demands while addressing sustainability goals.

For governments and organisations, investing in freeze-drying technology and infrastructure presents an opportunity to enhance food security, reduce waste, and mitigate the environmental impact of food systems. By integrating freeze-drying into supply chains, nations can build resilience against future disruptions, including climate change and geopolitical instability.

Freeze-drying is more than a technological advancement – it’s a critical tool for addressing the interconnected challenges of food insecurity and waste. By extending shelf life, retaining nutritional value, and reducing spoilage, freeze-drying has the potential to reinvent how we store and distribute food.

As the world faces growing environmental and humanitarian challenges, embracing sustainable innovations like freeze-drying will be essential to creating a more equitable and food-secure future. Through collaborative efforts between governments, aid organisations and private bodies, this technology can help reshape global food systems for the better, for everyone.


Bio:

Sverre Puustusmaa is the CEO and founder of Tactical Solutions, a company he established in 2016. With a background as a soldier in the special forces and a medic in challenging conditions, Sverre was inspired to create a solution to the low-quality military rations he encountered during critical missions. His frustration with inadequate food led to the development of a solution that prioritises high-quality, nutritious meals in all conditions.

Under Sverre’s leadership, Tactical Solutions has pioneered innovations in food technology and sustainability. The company’s mission is to deliver nutritious, economically efficient food solutions without compromising on taste, embodied through successful brands like Tactical Foodpack and Chef Urban. Sverre’s focus on quality drives his commitment to ensuring that food should never be compromised.

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Business

Beyond oil: Unlocking the potential of the lubricant industry

By Leyla Alieva, Co-Founder and CEO of NEOL Copper Technologies, and Paul Whiting, CEO of Delta-Xero

The lubricant industry is an important yet often overlooked cornerstone of the global economy, ensuring the seamless operation of machinery across numerous sectors. Despite its importance, the sector doesn’t get the attention it deserves. Many businesses underestimate the value and capabilities of advanced lubrication programs, leading to missed opportunities to maximise the efficiency and lifespan of equipment, as well as prevent the excessive consumption of oils.

As industries face growing pressure to prioritise sustainability and reduce carbon footprints, the use of traditional lubrication practices is becoming a significant challenge. Businesses need to consider not only the technical performance of lubricants but also their environmental impact—both in production and usage. Companies must shift their focus toward selecting, and investing in, more sustainable and efficient lubrication solutions, driving their respective industries to resilience through circular economy.

Critical role of lubricants in driving efficiency

Lubricants are far more than a technical necessity—they’re vital for minimising friction, reducing wear, preventing unexpected downtime, and extending the life of equipment. High-quality lubricants can significantly decrease maintenance costs and operational downtime. For instance, in sectors like transportation, efficient lubrication can enhance fuel economy and reduce emissions.

However, many businesses in the UK are still unaware of these benefits. Too often, users opt for cheaper oils, without realising the long-term costs to machinery performance and environmental sustainability. At the same time, equipment failures are frequently blamed on oils, when the real culprit is poor oil management.

This highlights a pressing need for education around the advantages of advanced lubrication. By providing education on innovative lubricants and lubrication practices, companies can empower users to make informed choices, which ultimately leads to better machinery performance and reduced waste. For instance, synthetic base oils additised with copper filming technology allow companies to maintain machinery efficiency without aging, breakdowns, or toxic emissions.

Addressing the environmental impact of lubricants

As the push toward Net Zero 2030 intensifies, industries can no longer ignore environmental pressures. The lubricant industry contributes to carbon emissions through oil and natural gas extraction, production, and disposal. But there are solutions on the horizon to minimise this contribution —innovative companies are leading the charge toward sustainability. A combination of high-quality synthetic lubricants and filtration can significantly reduce the overall consumption of lubricants and associated carbon emissions.

Additionally, this “dynamic duo” can reduce the frequency of oil changes, leading to lower waste generation and reducing the overall cost of lubrication. Extending lubricant lifespans through innovative filtration solutions could revolutionise lubricants sector and dramatically reduce environmental impact.

Embracing the circular economy

The lubricant industry is beginning to embrace the principles of the circular economy, prioritising value over volume, a shift that is redefining its future. Traditionally, spent lubricants were treated as waste, but that mindset is also changing. Recycling and reusing oils is no longer just an option—it’s a necessity.  Reconditioning used oils by removing contaminants and restoring their properties conserves valuable resources and reduces environmental harm.

Major oil companies are now exploring oil filtration and recycling as viable solutions, signaling a shift toward sustainability. This is more than a trend; it’s a transformative movement reshaping the industry.

While synthetic lubricants are typically more efficient than conventional oils, their higher cost has deterred many industries from making the switch. However, as filtration methods advance extending their useful life, the long-term cost savings of synthetic lubricants become clearer and adoption rates are expected to rise.

Looking forward

Machinery lubrication plays a critical role in addressing some of today’s biggest industrial challenges, from improving performance to reducing carbon emissions. Advanced lubrication practices not only extend equipment life and enhance efficiency but also help cut waste and support sustainability. By adopting innovative solutions like reconditioning oils and synthetic base oils, businesses can drive operational success while reducing their environmental impact.

As the industry evolves, it’s crucial to recognise the potential of advanced lubricants in solving both business and environmental issues. They are more than just maintenance tools; they are key drivers of sustainability and efficiency. By embracing these innovations, companies can boost their bottom lines while contributing to a more sustainable future for the planet.

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