July 18, 2023
3 mins

Financing a Warehouse Project: A Guide

Key take away points:

  • How finance can help you acquire the assets you need to streamline your warehouse operation
  • The range of assets and warehouse fit-out projects that can be financed
  • The benefits of financing your warehouse project vs paying in cash

Ensuring your warehouse operation is up to standard in terms of efficiency, productivity and safety requires regular investment, particularly when trying to remain competitive in your industry.

Unfortunately, making these investments with working capital is not always an option – and even when it is, it may not be the smartest use of your cash.  

Did you know that the costs inherent in setting up or updating your warehouse can be financed?

Here is a guide to some of the most common warehouse projects financed through Bluestone and the potential benefits of choosing to finance over purchasing with cash.

Finance for… warehouse flooring

Industrial flooring is essential in a warehouse environment for both safety and durability. Warehouse flooring needs to withstand heavy traffic and offer impact resistance against heavy loads to as well as stable pathways for warehouse vehicle traffic like pallet trucks and fork trucks.

Finance for… warehouse lighting

It is also important to consider the energy efficiency of the lighting you install to minimise running costs and your operation’s carbon footprint, which is why many choose LED lighting. LED lighting can also provide a better quality of light which is important for health and safety as well as security.

Finance for… a mezzanine floor installation

The head space of a warehouse is often wasted space that could be utilised with the installation of a mezzanine floor. A mezzanine floor can provide additional storage space, production lines, office space, retail display, or more. Mezzanine floors are relatively easy to install and can be reconfigured in the future as your organisational needs change.

Finance for… racking and storage

From pallet racking and shelving to partitioning, cantilever racking or external racking, finance can help you maximise your warehouse storage space and boost productivity and efficiency.

Finance for… warehouse vehicles

You can spread the cost of upgrading or investing in warehouse vehicles such as forklifts, side loaders, reach trucks, order pickers, and pallet jack.

Finance for… solar panels

Installing solar panels on your warehouse roof can have a significant impact on your bottom line and reduce your carbon footprint. By generating your own electricity using free, clean energy from the sun you can reduce how much fossil fuel-generated electricity that your organisation needs to buy.

Finance for… inventory management technology and software

A warehouse inventory management system – including the software and any required devices – can also be financed to supercharge to efficiency and profitability of your warehouse’ processes. It can do this by giving you enhanced visibility of your stock levels, where stock is located, where it came from and where it is headed in real time.

You can also manage workflows and communicate information more effectively, and potentially maximise your storage capacity. This has a knock-on effect not only on efficiency, productivity, and accuracy, but also on your customer service levels and profitability.

Buying a warehouse with a commercial mortgage

Renting a warehouse space is not always the most cost-effective or long-term strategy. If purchasing a warehouse is on your to-do list, taking out a commercial mortgage would not only provide the advantage of owning the building once the mortgage is paid and mortgage repayments could be cheaper than rentals.

Bluestone can arrange a commercial mortgage for you, as well as the finance for the internal fit-out and equipment.

Benefits of financing your warehouse project

Financing the cost of investing in your warehouse enables you to avoid large upfront expenses by spreading the cost via affordable, regular, fixed-rate payments.

This enables you to access what you need to realise your potential without compromise or delay, retain capital in your organisation, and budgeting for cashflow and growth becomes much easier.

Plus, you may also:

  • Unlock 100% tax relief (on both capital and interest) – savings you would not see if purchasing with cash.
  • Avoid sinking cash into ultimately depreciating assets.
  • Avoid having to part with VAT as a lump sum upfront as it's often spread over your repayments (excluding Hire/Lease Purchase agreements).
  • Remove unexpected spikes in your expenditure that you have not budgeted for, enabling you to plan better for your future growth.
  • Reduce your credit risk - over-reliance on your primary funder is never a great strategy, whereas finance involves working with specialist funders.
  • Wrap multiple elements of a project or different finance products into one bespoke solution.

Streamline your warehouse operation with finance from Bluestone

We pride ourselves on being specialists in the interior fit-out and warehouse industry, and with over 25 years of experience behind us, you can rest easy knowing you're in good hands.

  • Independent and bespoke finance solutions
  • Over 25 years of industry experience
  • Access to a specialist funding panel
  • Whole project funding

We take a consultative approach to our relationships and making sure you have all the information you need, whether finance is the right solution for you or not, is important. Contact us today for a no-obligation conversation.

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