Business finance for skip-hire companies

Why skip-hire cash flow is front-loaded

Skip hire ties cash up at every stage of the cycle. The skips themselves are an inventory of steel that has to be bought before it earns, and a hook-loader or grab lorry to move them is a major vehicle cost. Then, when a skip comes back full, the firm pays to tip and dispose of the waste — landfill tax, gate and processing fees — before the customer's invoice is settled. Cash-paying domestic hires help, but the steady trade and construction accounts that fill the diary pay on 30-day terms. So the firm buys the skips, runs the lorry and pays to dispose now, and collects later.

Where the cash gets stuck

The squeeze sits in the capital locked into the skip fleet and vehicles, in the disposal and landfill-tax costs paid as skips return, and in the gap between hiring out to trade and account customers and being paid by them. Skips out on long hires are earning slowly while tying up the asset. Permits and compliance add lumpy costs. Demand also swings with construction activity and the seasons, and expanding the fleet or adding a transfer station lands a large outlay before the extra hires pay it back.

What skip-hire firms use funding for

Typical uses include buying more skips to meet demand, adding or replacing a hook-loader or grab lorry, developing a transfer station to cut disposal costs and add processing income, covering tipping and landfill-tax costs ahead of account billing, and bridging the wait on trade and construction accounts. The aim is to fund capacity that earns and work that is contracted, repaid as hires and accounts settle. Size the disposal-to-billing gap with the working capital calculator.

What to weigh before borrowing

Tie repayments to your account-billing cycle, and watch concentration risk where construction clients dominate the book and can pay slowly. Weigh whether a transfer station genuinely reduces disposal cost enough to justify the spend, compare a short facility against asset finance for a lorry, and ask for the total repayable, not just a rate. Read how to calculate affordability. This is general information, not advice on your accounts.

How short-term company finance fits — no personal guarantee

Credicorp lends to the limited company, not to you personally — no personal guarantee, so your home is not pledged against the facility. As an exempt business lender it provides working capital to UK companies rather than regulated consumer credit. A business loan or the flexible Credicorp Flex line gives a skip-hire firm a controlled pot to expand the fleet or build a transfer station, repaid as hire and account income comes in. You can apply online.