What is a unit stocking facility?

Car Dealership Stocking Facility

What is a unit stocking facility?

As a car dealer, managing inventory can be one of the most challenging aspects of running a successful business. Finding the right financing solution to keep your stock levels up while maintaining healthy cash flow is critical. This is where a Unit Stocking Facility (USF) comes into play, offering car dealers a flexible and convenient way to fund the vehicles they need without the typical constraints of traditional loans.But what exactly is a Unit Stocking Facility, and how can it help you grow your business?

Get the Funds You Need – We provide a revolving line of credit, enabling you to purchase more vehicles without the upfront cost.

Purchase Vehicles for Your Forecourt – Use your stocking loan to buy vehicles at auctions, directly from manufacturers, or through other sources.

Sell and Repay – Once the vehicle is sold, simply repay the loan and reinvest in fresh stock.

Understanding a Unit Stocking Facility

A Unit Stocking Facility is a form of finance specifically designed for car dealers to fund their vehicle stock. Essentially, it allows dealers to borrow money to purchase cars that are then held as inventory for sale. The finance provider typically offers a revolving line of credit, meaning you can borrow against the vehicles you already have in stock and continuously replenish your inventory with new cars.

It’s called "unit" because it is based on individual vehicle units, rather than a lump sum loan for a set period. This offers flexibility for dealerships to scale their stock levels as demand changes.

The Benefits of a Unit Stocking Facility

Flexibility - One of the greatest advantages is the flexibility of this facility. You don’t need to commit to a fixed loan term, making it easier to manage cash flow and maintain stock levels.

Cash Flow Management - By only repaying as vehicles are sold, a Unit Stocking Facility enables you to better manage your cash flow and avoid tying up too much capital in unsold stock.

Access to More Stock - With a USF, dealers can access a greater variety of vehicles without the need for significant upfront investment. This allows you to offer a broader selection of cars to your customers, boosting sales potential.

No Impact on Consumer Finance - Unlike other forms of financing that may be linked to consumer finance, a Unit Stocking Facility focuses purely on your vehicle stock. This means there are no consumer finance pressures or obligations attached.

The Benefits of a Unit Stocking Facility

A Unit Stocking Facility is an ideal option for car dealers who want to grow their inventory without significant upfront costs. It offers flexibility, improved cash flow, and a way to scale operations quickly in response to market demands. Whether you're a small independent dealer or a larger multi-location business, a USF can be a vital tool in maintaining a competitive edge in the automotive market.

At [Your Company Name], we understand the importance of flexibility in financing. That’s why we offer tailored Unit Stocking Facilities that allow car dealers to finance their stock with no strings attached. Get in touch with us today to find out how we can help you grow your business.