Findlater's Fine Foods: A Credit Solution Satisfies a Taste for Growth

Findlater's Fine Foods

Luxury pâté producer Findlater’s Fine Foods found demand for its growing product line outstripping its ability to supply. Funding from Santander helped the business keep on top of orders and strategize its future growth.

In brief

  • Sector: Food Manufacturing
  • Findlater’s Fine Foods is a fast-growing business experiencing high levels of demand for its gourmet pâté, which it produces and supplies to both independent stockists and upmarket chains.
  • The company needed funding to buy new storage premises and production facilities to help meet a rapid upturn in demand. This funding could have been obtained via a government grant, but the company couldn’t meet the required outlay.
  • The Santander Relationship Director dug deep into the business in order to present the fullest possible picture of the company’s growth potential. Once approved, the funding package provided Findlater’s with bridging finance for the grant, in addition to an overdraft and day-to-day banking.
  • Santander funding has enabled Findlater’s to better manage their rising sales by establishing a new distribution centre and more refrigerated storage, allowing the company to better handle demand and save rental costs, which can now be reinvested in the business.
Findlater's Fine Foods

Founded in 2004 as a restaurant and delicatessen, Findlater’s Fine Foods in Linlithgow, West Lothian, quickly established a reputation for offering high-quality produce. Company founder and Managing Director Martin Henderson realised that demand for his range of luxury pâté was outstripping the rest of his business, as other local companies began to ask if Findlater’s could supply them. In 2007, Martin sold the restaurant and ploughed the proceeds into a larger production facility, transforming Findlater’s into a food supply business.

Today, the business employs 20 people and Findlater’s supplies 700 independent stockists, as well as several upmarket chains including Waitrose. Most recently, Findlater’s diversified its offering to include a new food service range: pâté packs for chefs running banqueting operations, premium hotels and airlines.

Seeking funding

Findlater’s first banked with Santander in May 2012, at which point the company owned two production units, which they paid for with a combination of grants and loans. Now they were looking to purchase a third unit to house refrigerated storage and serve as a distribution centre. Buying their own storage facility also meant the company would no longer have to rent, saving money that could then be reinvested in the business. But Findlater’s lacked the required outlay for the purchase, as Martin explains. “We source a lot of produce locally and so are eligible for government food processing grants,” he says. “But you have to pay the money first and then get reimbursed, so we needed a bridging facility for that, as well as for VAT, which was also payable in advance."

In a deal facilitated by Santander Relationship Director Kirsty Johnston, the bank provided Findlater’s with a £180,000 bridging loan to cover the grant and a £180,000 term loan needed to buy the third unit. The loans also met the advance VAT payments, which would be reimbursed at a later date. In addition, Santander provided a day-to-day £50,000 overdraft and an asset finance line. “We committed to about £100k in funding, specific to the various production assets that [Findlater’s] aspired to secure over the coming months,” explains Santander Asset Finance Partner Fraser Tilley. “Without doubt, it’s enabled them to improve the levels of productivity in so far as getting finished product out the door a lot faster and satisfying the market demand.”

The challenge of rapid growth 

However, the fact that Findlater’s year-on-year growth was so rapid (40% per annum over its last three years) presented Relationship Director Kirsty with a familiar but tricky proposition. She had to be especially thorough in presenting the company’s case to the Santander credit team. “It’s a common problem for growing businesses,” she explains. “The financial year in 2010 looked nothing like the financial year in 2011 because the growth story is so substantial. So we were looking at a new client with effectively no track record.”

Kirsty explains how she negotiated the problem. “We had to build a track record for this business,” she says. “I could have approached credit on the information we had at the time, but their year-end was only five weeks away. I told the client we would be better off waiting and showing new year-end figures with the benefit of tracking performance to budget for the final few months of their financial year. The budgets for the final three months of the year gave us an indication of how closely Findlater’s track to their budgets. So when we approached the credit team we were able to demonstrate that they did everything they said they would, if not better. Their budgets were not just aspirational, they were achievable.”

Championing potential

The credit team approved Kirsty’s application, leaving Martin impressed with her willingness to stand by her client and champion growth potential that may not have been evident from the balance sheet. “Santander were very helpful,” he says. “Their Relationship Directors have a good idea of how the credit department will react. They speak to them regularly and they almost pre-evaluate cases put before them.”

Martin believes Santander have given his company the freedom to grow significantly, a goal that Kirsty remains keen to help him achieve by continuing to offer advice and make introductions. “We’ve had lots of conversations about growth and the implications that will have on the management team, as well as the required financial support,” she says. “Also things like how he can find the right advisors for the future with strong food and drink experience as well as technical expertise. These things might be a year away, but it’s good to start thinking about them now.”

Martin believes Santander have enabled his company to maintain its spectacular growth curve. “We were at capacity with our existing logistics and there was no further room to package, chill and store finished goods,” he says. “Without expansion, the business couldn’t grow. Without the grant and the finance we couldn’t buy and kit out the extra building space.”

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