Start up loan for van.

[matt90bc]

Can I get a start up loan for a van? I've been offered a good run of work thats paying very well but its on a self employed basis and I can either supply own van or hire for £200 a week. A decent transit is about £20k and I'd spend that in 2 years on hire plus the general stress of having probably a tracked van that I'll also be charged £300 if there a scratch. The work is electrical contracting but I've wanted to try doing something new and having a van would allow me to try other things. I've been looking to try and win some of my own contracts and it would make life easier if I was ready to go.
I'll also add I quit my employed job 4 months ago to take a break and would like to stay/become self employed for a bit. But currently I'm not working.

 

[Porky]

Can I get a start up loan for a van? I've been offered a good run of work thats paying very well but its on a self employed basis and I can either supply own van or hire for £200 a week. A decent transit is about £20k and I'd spend that in 2 years on hire plus the general stress of having probably a tracked van that I'll also be charged £300 if there a scratch. The work is electrical contracting but I've wanted to try doing something new and having a van would allow me to try other things. I've been looking to try and win some of my own contracts and it would make life easier if I was ready to go.
I'll also add I quit my employed job 4 months ago to take a break and would like to stay/become self employed for a bit. But currently I'm not working.

@matt90bc
Give the start up loans scheme a go.
If your business plan stocks up, then it’s possible they could lend you the 20k over five years of which the capital can be used for a van at very low rates. Worth a try but you will need to put some effort into your business plan and financials but you can use their templates and they will help you with your application.
Good luck

 

[matt90bc]

@matt90bc
Give the start up loans scheme a go.
If your business plan stocks up, then it’s possible they could lend you the 20k over five years of which the capital can be used for a van at very low rates. Worth a try but you will need to put some effort into your business plan and financials but you can use their templates and they will help you with your application.
Good luck

Thanks for the reply porky. Is this through the government? I just googled start up loan scheme and was mostly links through gov website and no site actually called that. Sorry if I'm being a div.

 

[Porky]

Yes, the U.K. national scheme backed by British Bank:-

Home Page

Whether you are looking to start up a business or want to grow, our Government backed Start Up Loans offer up to £25,000 alongside mentoring and support.

www.startuploans.co.uk

You won’t get a better rate anywhere than 6%. Submit the request and they will allocate you to a provider such as Virgin Loans or GE Capital or whoever next on list, doesn’t matter they all work to same framework, fill out the templates and submit application.

I would add that it’s not a quick process you are talking 8-12 weeks. BUT the provider will want you to be successful and can provide free mentor support to help with your application.

At the end of the day, there are no guarantees as in life BUT IMO you won’t get a better deal and you have more chance of success under the start up scheme than say going direct to your bank and the rate will be far better.

I am a big advocate of the scheme it’s possibly the ONLY government backed small business scheme that’s any good, mind you with our current anti business government no doubt they close the scheme soon so I would get a move on and apply now whilst it’s still operating.

Good luck

 

[Mark T Jones]

Like @Porky I'm a big fan of the start up loan scheme, and given your (non) employment status, may well be the only realistic option.

That said, do you really need a £20k van - you can get a solid, decent condition used one for half that

 

[BusterBloodvessel]

Why the hell do you need a 20k van? Half, if not a quarter of that would get you something decent.

Or consider what a loan repayment would be and consider leasing, again it would be less than half the £200/week through the work you've been offered.

If you want a start up loan you're going to need a hell of a detailed plan beyond "having a van would allow me to try other things"

 

[WaveJumper]

But a cheaper van then upgrade in the future when you are sure the business has legs no point in piling on the overheads from the start. As an aside have you sorted your insurance out to cover yourself whilst self-employed (another cost to factor in)

 

[fisicx]

Do you really need a van? Chap who does our sparky stuff just uses his car.

 

[Paul Kelly ICHYB]

I've been offered a good run of work thats paying very well but its on a self employed basis

What if the business doesn't work or you are not paid by a customer? You are stuck with a loan/van costing you money.

Either buy a cheap van or hire until you have proven the business and have built up a fund.

 

[DWS]

Do you really need a van? Chap who does our sparky stuff just uses his car.

Doesn’t look as professional and certainly less tax benefits

 

[fisicx]

Doesn’t look as professional and certainly less tax benefits

But a lot cheaper when starting out. Very few traders round here put advertising on their vans these days. Makes them too much of a target.

 

[Mark T Jones]

Doesn’t look as professional and certainly less tax benefits

Nobody about how it looks, as long as it's tidy(ish) and legal

Tax benefits - it depends

 

[DWS]

But a lot cheaper when starting out. Very few traders round here put advertising on their vans these days. Makes them too much of a target.

You don’t need to advertise to have a van, just saying if you want to give the impression as a professional qualified electrician then it looks better turning up at a job in a van rather than a car with ladders, conduit, trunking etc tied to a roof rack on a car!

But a lot cheaper when starting out. Very few traders round here put advertising on their vans these days. Makes them too much of a target.

 

[DWS]

Nobody about how it looks, as long as it's tidy(ish) and legal

Tax benefits - it depends

I disagree, it’s what it portrays, as I said in my last reply, looking professional makes a big difference especially with a trade like electricians where all the work needs to be carried out by suitably qualified tradesmen.

 

[Mark T Jones]

I disagree, it’s what it portrays, as I said in my last reply, looking professional makes a big difference especially with a trade like electricians where all the work needs to be carried out by suitably qualified tradesmen.

We'll agree to differ

In this case, however the OP may well be forced to change their thinking because they are reliant on borrowing, which may not be available (and I can guarantee that Start Up Loans will raise the question of why they need a £20k vehicle)

 

[DWS]

We'll agree to differ

In this case, however the OP may well be forced to change their thinking because they are reliant on borrowing, which may not be available (and I can guarantee that Start Up Loans will raise the question of why they need a £20k vehicle)

And that’s what makes the forum, different opinions and views.
But in the case of the £20k van I totally agree with you, no need spend this amount, get something cheaper and if all goes to plan then look at other options further down the line.

 

[fisicx]

You don’t need to advertise to have a van, just saying if you want to give the impression as a professional qualified electrician then it looks better turning up at a job in a van rather than a car with ladders, conduit, trunking etc tied to a roof rack on a car!

Surely this depends on the car. This one looks OK to me:

 

[Paul Kelly ICHYB]

This one looks OK to me:

...and you could put a branding sticker on the door or windows (something like 'tools & items inside - please break in!!).

 

[DWS]

Surely this depends on the car. This one looks OK to me:

As I said it’s about looking professional and if you think that does!!!!!

 

[matt90bc]

Thanks for replies all. The reason I want to pay more is that in my experience when I was younger and I did buy cheaper vans with high mileage etc I ended up spending what I initially paid again on repairing it. I'd be doing maybe 30k+ in milage a year and buying a van that already has 100k+ on the clock just isn't worth the ongoing stress of always being in the garage and then loosing days pay on top. Also I live in Bristol and we have a ulez zone over most of the city now so it need's to be compliant. I'd rather pay a bit more for low milage and reliability then have a decent trade in or resale value when the milage gets to the point where problems occur. The 20k will also have to cover the VAT cost as I'm not VAT registered and right now doesn't seem worth registering as I'll be getting paid a day rate. IMO transport is the most important tool a tradesmen has that need's to be reliable. A car won't do it because of the amount of stock I need carry to do jobs too. It's transient work all around scotland mostly as well as rest of UK so I don't want to be having to make trips to merchants everyday to keep stock levels up. And I'd also like to get in a position to do other work with the van which I won't be able to if it's company. Vans that are 4/5 years old with mileages under 30k are costing about £20k.
Also using a car to carry all tools and materials means either unloading the entire thing every night or risk having the windows put through. I'll be working away mostly in hotels so can't really be unloading all my stuff to a hotel room every night.

 

[fisicx]

As I said it’s about looking professional and if you think that does!!!!!

Why would owning a transit make them look any more professional?

 

[Mark T Jones]

Thanks for replies all. The reason I want to pay more is that in my experience when I was younger and I did buy cheaper vans with high mileage etc I ended up spending what I initially paid again on repairing it. I'd be doing maybe 30k+ in milage a year and buying a van that already has 100k+ on the clock just isn't worth the ongoing stress of always being in the garage and then loosing days pay on top. Also I live in Bristol and we have a ulez zone over most of the city now so it need's to be compliant. I'd rather pay a bit more for low milage and reliability then have a decent trade in or resale value when the milage gets to the point where problems occur. The 20k will also have to cover the VAT cost as I'm not VAT registered and right now doesn't seem worth registering as I'll be getting paid a day rate. IMO transport is the most important tool a tradesmen has that need's to be reliable. A car won't do it because of the amount of stock I need carry to do jobs too. It's transient work all around scotland mostly as well as rest of UK so I don't want to be having to make trips to merchants everyday to keep stock levels up. And I'd also like to get in a position to do other work with the van which I won't be able to if it's company. Vans that are 4/5 years old with mileages under 30k are costing about £20k.
Also using a car to carry all tools and materials means either unloading the entire thing every night or risk having the windows put through. I'll be working away mostly in hotels so can't really be unloading all my stuff to a hotel room every night.

Points taken.

Do try Start Up Loans - though they aren't idea for vehicle purchase

Realistically you may have to make compromises whilst you build up S/E credibility to finance a new van.

 

[DWS]

Why would owning a transit make them look any more professional?

Maybe the majority of tradesman have got it all wrong and they should get rid of their vans and get cars with roof racks!

 

[JEREMY HAWKE]

If this van is doing decent distance absolutely do not buy and take the hire option. Modern vans are troublesome and a van out of warranty will cost you £350 a month in maintenance.
I dont buy any vans now during the pandemic we were flat out and went through 3 Peugeot Boxer engines on 3 vans in 18 months when they reach 120K and one even 40K
Its not what it used to be they are all made from cheese now
If I really had to buy a big van now I would be getting the best 10 year old Sprinter I could find
Maybe this business would be successful if boot strapping was employed as loved by the usual suspects on here

 

[BusterBloodvessel]

As I said it’s about looking professional and if you think that does!!!!!

Agreed a rustbucket with missing wheel trims and mismatching body panels won't quite cut the mustard. But it can be fine.

A friend of mine does maintenance and repairs and after getting sick of having his van robbed, he changed to an estate car around 2 years ago. It has a discrete white sticker with his logo & contact details on the back window. It's a 6 year old passat, nice spec, kept meticulously clean.

It looks as good as anything else turning up at a job and I can guarantee he hasn't lost a single bit of work since converting to it - in fact last year was his busiest ever.

 

[matt90bc]

So failing the start up loan does anyone know what I'd be looking at to lease a transit? I do have the cash to buy outright but that money is more for emergencies or a house deposit when the time comes.

 

[Magrisk]

So failing the start up loan does anyone know what I'd be looking at to lease a transit? I do have the cash to buy outright but that money is more for emergencies or a house deposit when the time comes.

Try lease loco to give you a screen-scraper of leasing deals around the UK as a starting point. Prices are mental and like Jeremy says , made of cheese.

Leaseloco

 

[matt90bc]

I've just looked at lease and for a 30k a year mileage allownce I'd have to put down £5k deposit with £440+vat repayments and in 24 months I'd have to give the van back and start again. So over £18k over the 2 years with no van left at the end of it.

 

[WaveJumper]

Just to throw something into the mix my son got rid of his Transit Custom 2 years ago wanted to go electric and at the time Ford could not come up with the goods. He bought a car(EV) and a very nice box trailer so he can carry on moving stock between his warehouse and workshop, he will never go back to a van.

 

[matt90bc]

Just to throw something into the mix my son got rid of his Transit Custom 2 years ago wanted to go electric and at the time Ford could not come up with the goods. He bought a car(EV) and a very nice box trailer so he can carry on moving stock between his warehouse and workshop, he will never go back to a van.

Not really practical for my needs but appreciate the input. Don't fancy towing a trailer all over the UK and trying to park it at 5+ different jobs a day.

 

[JEREMY HAWKE]

I've just looked at lease and for a 30k a year mileage allownce I'd have to put down £5k deposit with £440+vat repayments and in 24 months I'd have to give the van back and start again. So over £18k over the 2 years with no van left at the end of it.

It costs me 24 K to run each van over 2 years
For your own mental health move away from the idea of owning something because the reality is that your left with a liability not a asset
Either way new van or older van with repairs will still cost roughly the same in the long run
If its not a major part of your business and supporting your main activities with lower miles then I would look at an older tidy van

 

[Mark T Jones]

I've just looked at lease and for a 30k a year mileage allownce I'd have to put down £5k deposit with £440+vat repayments and in 24 months I'd have to give the van back and start again. So over £18k over the 2 years with no van left at the end of it.

My wife has just leased a Toyota ProAce - £12K miles pa for a tad under £400 (inc VAT) per month.

I'm in the finance industry, and couldn't say whether it's more expensive or cheaper than buying - there are too many variables - not least future RVs.

Leasing gives you financial certainty, buying gives you flexibility.

 

[Magrisk]

I've just looked at lease and for a 30k a year mileage allownce I'd have to put down £5k deposit with £440+vat repayments and in 24 months I'd have to give the van back and start again. So over £18k over the 2 years with no van left at the end of it.

Yep, gone mental over the past few years.

I have worked across UK and Ireland on wind farm jobs where 4x4 are needed and in 2023 one of the supervisors had maxed out his £8500 limit in the ROI just on jeep rental. Short term leasing in different areas can really vary. As can long term.

There are plenty of light commercial people where business may not be booming, consider renting from N Ireland where I am or Northern Scotland/ England where rates may (REPEAT may) be better. A one off 3250 delivery charge might pay itself back in a month.

Good luck

 

[RKTS46]

Jumping on this thread as I'm in the same situation as OP. Potentially got work coming up but do not have the finance for a van/vehicle, at the moment I'm going to have to hire for 65/day (ouch) which means pretty much no profit out of the work once fuel and insurance is factored in.

As a general rule for a compact car-derived van eg courier or connect what is a reasonable day rate for hire? Not sure if 65 is the going rate or a good deal or...?

 

[JEREMY HAWKE]

Jumping on this thread as I'm in the same situation as OP. Potentially got work coming up but do not have the finance for a van/vehicle, at the moment I'm going to have to hire for 65/day (ouch) which means pretty much no profit out of the work once fuel and insurance is factored in.

As a general rule for a compact car-derived van eg courier or connect what is a reasonable day rate for hire? Not sure if 65 is the going rate or a good deal or...?

If you dont have enough money in the game to pay £65 a day for van hire then walk away now before you experience financial hardship
What ever your getting involved in here is a very bad deal

.

 

[RKTS46]

If you dont have enough money in the game to pay £65 a day for van hire then walk away now before you experience financial hardship
What ever your getting involved in here is a very bad deal

If you dont have enough money in the game to pay £65 a day for van hire then walk away now before you experience financial hardship
What ever your getting involved in here is a very bad deal

.

I'm genuinely open to suggestions as I don't want to make a bad decision- as in walk away from the business idea?

I really want to make this startup work as I am keen to have control over my own working life and income.
I am entirely aware that as a general rule you need a lump sum of cash either from assets or family investment to get started but unfortunately for me that just isn't going to happen. I want to try and make it work even if that means operating at little to no profit to start off with until I am able to pick up enough work to afford and justify a work van.

 

[Mark T Jones]

I'm genuinely open to suggestions as I don't want to make a bad decision- as in walk away from the business idea?

I really want to make this startup work as I am keen to have control over my own working life and income.
I am entirely aware that as a general rule you need a lump sum of cash either from assets or family investment to get started but unfortunately for me that just isn't going to happen. I want to try and make it work even if that means operating at little to no profit to start off with until I am able to pick up enough work to afford and justify a work van.

Have you looked at start up loans

 

[Paul Kelly ICHYB]

I am entirely aware that as a general rule you need a lump sum of cash either from assets or family investment to get started but unfortunately for me that just isn

And that is where people make assumptions incorrectly. Many businesses (probably most) do not know or understand the options or routes to take because they are new and do not seek out advice or ask questions. Coming here already makes you different from the majority.

You can hire something like a Vivaro for 2 months for about £50 a day and there will be cheaper out there.


Also, without knowing what you are doing, on minimum wage you will make £90 a day. If on the tools you should be on £2-300 minimum and, if self employed, that van cost reduces your tax liability as a cost.

If the van hire means you will not make any money, you are undercharging or in the wrong game.

 

[JEREMY HAWKE]

I'm genuinely open to suggestions as I don't want to make a bad decision- as in walk away from the business idea?

I really want to make this startup work as I am keen to have control over my own working life and income.
I am entirely aware that as a general rule you need a lump sum of cash either from assets or family investment to get started but unfortunately for me that just isn't going to happen. I want to try and make it work even if that means operating at little to no profit to start off with until I am able to pick up enough work to afford and justify a work van.

It would be helpful to the members on here who can then help you if you diiscribed the industry you going in to

We have established that your not going into transport as you ignored my advice

 

[RKTS46]

And that is where people make assumptions incorrectly. Many businesses (probably most) do not know or understand the options or routes to take because they are new and do not seek out advice or ask questions. Coming here already makes you different from the majority.

You can hire something like a Vivaro for 2 months for about £50 a day and there will be cheaper out there.


Also, without knowing what you are doing, on minimum wage you will make £90 a day. If on the tools you should be on £2-300 minimum and, if self employed, that van cost reduces your tax liability as a cost.

If the van hire means you will not make any money, you are undercharging or in the wrong game.

Very fair advice, perhaps I have had a somewhat biased

And that is where people make assumptions incorrectly. Many businesses (probably most) do not know or understand the options or routes to take because they are new and do not seek out advice or ask questions. Coming here already makes you different from the majority.

You can hire something like a Vivaro for 2 months for about £50 a day and there will be cheaper out there.


Also, without knowing what you are doing, on minimum wage you will make £90 a day. If on the tools you should be on £2-300 minimum and, if self employed, that van cost reduces your tax liability as a cost.

If the van hire means you will not make any money, you are undercharging or in the wrong game.

Apologies, perhaps that is an incorrect assumption!
I was lucky enough to speak with an impartial advisor regarding startups and unfortunately this is an almost verbatim quite from him... "Most businesses have a cash injection from family to get started, have you thought about asking your family for money to buy a van" which was not entirely helpful...

I do know that there are some extremely motivated self-starters, of whom I'm hoping to join the ranks.

I am not on the tools no, this is a building surveying job, althoight I am not a qualified assessor I have been doing this for quite a while so possess the experience to get the job done.
Next step is to get myself some formal qualifications once I have earnt the money to fund these to improve my 'resume' and appeal to customers.

I've already started using QuickBooks to track my expenses so I can see at what stage I break even, of course right now it's in the negative but that's because I've invested into software and hosting.

Apologies if I was presumptuous!