Our ‘Tales from the Funding Front Line’ blog series showcases how we’re working with clients to keep their businesses moving during the COVID-19 pandemic. We recently talked to Michael Jones, one of our Relationship Managers, about how he has supported Medspace Solutions with funding that’s helped them play their part in building Nightingale Hospitals across the UK.
The NHS has been under constant pressure since the coronavirus pandemic started and the latest figures suggest this isn’t subsiding – the start of October saw a 25 per cent increase in COVID-related hospital admissions. It was this kind of pressure which necessitated the formation and opening of seven Nightingale Hospitals earlier this year which aim to drastically ease the burden on traditional hospitals.
That’s why we’re so proud to see our client Medspace Solutions, a leading manufacturer and supplier of furniture, fixtures and equipment for the healthcare industry, play a pivotal role in helping to get some of the Nightingale Hospitals up and running under very tight time constraints. In fact, projects that would have traditionally taken six months were turned around in three weeks.
The projects varied from one hospital to the next but the shared goal was to ensure that patients, medical and support staff were kept as safe as possible. For example, in some instances the company installed COVID-secure screens around reception desks, while one unit for the Health Board in Republic of Ireland required 900 lockers, which Medspace shipped in six batches.
The increased workload resulted in Medspace hiring additional sub-contractors to ensure the timely delivery of projects – one Nightingale hospital project required 17 workers, with 80 per cent or more being sub-contractors. The rapid step-change in approach resulted in a substantial increase in capital leaving the business in wages. Simultaneously, the company continued its regular projects with large organisations across the country, many of which have payment terms of 60-90 days, with invoicing often withheld until project delivery. Lengthy payment terms are something many SMEs face, but when coinciding with increased expenditure waiting 2-3 months for payment can cause serious cashflow issues. That’s why our flexible finance offerings aim to help companies in exactly this type of situation.
At Ultimate Finance we pride ourselves on the relationships we build with our clients, ensuring we have an in-depth knowledge of the complexities of their businesses and the specific issues they face. This is why we agreed a £300,000 Construction Finance facility with Medspace in 2018, knowing that such a limit could give the company peace of mind that should rapid scale-up ever prove necessary, we’d be here to help. The flexibility has been critical here, as the average amount that Medspace borrowed increased from £50,000 to £250,000 between April and August to cover the cost of labour and support the amazing work the business has done in support of the NHS and its key workers.
The facility allowed the team to focus on the projects at hand, rather than spending valuable time and resource worrying about cashflow management. As a result, Medspace has played a pivotal role in the formation of each of the UK Nightingale hospitals and supporting the wider healthcare industry – something we’re confident will continue long into the future.