Sustainable firm Jutexpo is set to boost turnover and expand overseas, thanks to a funding package, devised by Lloyds TSB.
The UK’s leading supplier of ethically-produced, fibre shopping bags is set to boost turnover and break into new domestic and overseas markets, after securing a £4.2 million funding package from Lloyds TSB.
Established in 2002 and based in Evesham, Worcestershire, Jutexpo Ltd is a £10 million turnover business that employs 25 people in the UK and over 2,000 in India. It provides reusable jute shopping bags to some of the UK's largest organisations, including ASDA, Waitrose, Eden Florist, Sainsbury’s, Tesco, and Macmillan Cancer Research.
With environmentally aware consumers keen to reduce plastic bag usage, demand for ethically produced, jute shopping bags has soared. To enable the company to capitalise on this trend, it approached Lloyds TSB to explore potential funding options.
This resulted in a £3.5million invoice discounting facility provided by Lloyds TSB Commercial Finance and bank loans amounting to £700k from Lloyds TSB Commercial.
Commercial Finance’s invoice discounting facility will enhance the company’s cash flow and free up funds to ensure it has the capital required to secure more new contracts. The funding is expected to dramatically increase the firm’s turnover over the next 12 months by enabling it to target new markets in the UK and internationally.
The business loans were provided as part of the Enterprise Finance Guarantee (EFG) scheme that was launched earlier this year.
Under the £1.3 billion EFG initiative, the Government guarantees lending to viable firms to ensure that they can access the working capital and investment that they need and will support bank lending, of three months to 10 year maturity, to UK businesses with a turnover of up to £25 million.
Barrie Turner, managing director at Jutexpo, said: “Each year our turnover has increased significantly, in line with the rising demand for an ethically produced and eco friendly alternative to plastic bags. There is huge growth potential in the UK and overseas and we intend to make the most of these expansion opportunities.
“We produce over 1 million bags every month, which means we have significant working capital requirements to fulfil our orders. Asset based lending gives us financial flexibility by quickly releasing the value tied up in outstanding invoices on our sales ledger.
“Our ongoing relationship with Lloyds TSB will contribute significantly to our success over the next few years.”
Mark Parsons, Area Director for Lloyds TSB Commercial Finance, continued: “The sector in which Jutexpo operates is buoyant and the business is taking advantage of its high quality product and good customer relations to grow market share.
“It’s great to see a company that, despite the wider economic downturn, is pressing forward with its growth plans and is developing its overseas supplier and client base.
“Asset based lending is the ideal tool to help Jutexpo capitalise on these opportunities by advancing the capital needed to facilitate its rapid growth strategy.”
Damian Mohan, Relationship Director at Lloyds TSB Commercial, added: “We worked closely with the management at Jutexpo and our colleagues from Lloyds TSB Commercial Finance to arrange a funding solution that best suits the company’s needs.
“Lloyds TSB has made clear its commitment to make funding accessible to organisations with a strong management team and sound business plan, such as Jutexpo. We have been recognised by the Government as one of the most active banks in helping small firms get access to EFG funding.”
ENDS