Using external funding to grow

How accessing external funding from Prospa has helped Phil Walding grow his label-making small business through times of challenge and opportunity.

At a glance

Here’s a snapshot at the insights from our interviewee:

  • A Prospa Small Business Loan has helped Phil Walding of LabelMAN to overcome business hurdles and refinance to secure supply chains.
  • Another, more recent, Prospa Small Business Loan has helped Phil develop a new marketing and advertising program.
  • Having this extra cash flow made it easier to meet short-term needs while keeping his eye on the future of his business.
  • Don’t wait until your liquidity is exhausted – talk to Prospa about a funding solution that suits your business.

For almost 20 years, Phil Walding has been churning out labels at a rate far beyond what you would expect for a one-man operation.

A combination of his commitment to quality, quantity and turnaround times, and financial support from Prospa at crucial times during the business’s growth, has meant Phil has been able to keep his six printing machines running through all the challenges his business has faced over the past few years.

Phil founded LabelMAN, based in Christchurch, in 2004 and as his business is based on a high level of automation, it operates at full capacity with just Phil and a couple of part-time staff.

Prospa was able to support Phil to buy a high-tech UV printer in mid-2019, approving and providing a Prospa Small Business Loan to ensure he could buy the new machine at a suitable price and get it up and running as soon as possible.

“I was able to start making products for a new market a lot sooner than if I had to wait until I had those funds on hand,” Phil said at the time. “It was just an immediate return on investment and the business has been able to grow because of it.”

Refinancing to meet short-term needs

However, as it was for many small businesses, 2020 was challenging. While LabelMAN was still busy, supply chain issues presented a hurdle to overcome.

“It was a very disrupted market that we were operating in, and it was very hard to tell what was happening,” he says.

Prospa checked in with Phil during the pandemic to see how his business was faring and Phil applied to refinance his Prospa Small Business Loan.

The extra funds allowed him to purchase additional stock and ensure he had enough supplies to last while he secured his supply chains. Having this extra cash flow help was a relief, Phil says, and made it easier to meet short-term needs while keeping his eye on the future of his business.

“We were doing OK after COVID, but then prices started to rise and supply chains were challenging again,” Phil says.

Riding the waves

New Zealand officially fell into recession in June 2023, however Phil saw the warning signs early and took out a further Small Business Loan from Prospa in late 2022 to bolster his cash reserves.

“I didn’t like the way things were looking, and it was good I did take out a loan as it has helped cash flow,” he says.

“There’s definitely more work out there, but many customers are a bit gun-shy about committing to large orders at the moment. We’re getting a lot of small orders at quite short notice. This isn’t as much of a problem for me as it is for traditional printers – in fact, I get a small spillover from them – but I’ve noticed a lot more customers are paying late.”

Phil says he’s continued to update his equipment over the last few years as he knows it’s important to maintain the quality of his plant.

His Mimarki UV printer, financed with a loan from Prospa in 2019, allowed Phil to offer a white ink option. The machine has been so successful – it had been running continuously for weeks when Phil recently shared his story, with at least another 10 days planned – he can see himself buying a second, faster model to complement his existing equipment.

But that will be when the economy picks up. Until then, Phil is making sure LabelMAN is positioned to make the most of an economic upturn if and when that comes.

“The most recent loan helped to carry me through a couple of tough months, and it also helped with a new marketing and advertising program that is just about to go live, including a complete rework of our website,” he says.

“I’d advise other small business owners that it’s important not to wait until your liquidity is exhausted – talk to Prospa sooner than later. Based on my dealings with them, they offer a completely different experience to a bank.

“It will be tough for at least another six months, but we’re still working close to capacity, mainly from word of mouth – we haven’t done any advertising for about 18 months. In the current climate, I think that’s a pretty good outcome.”

Looking to refinance or support your cash flow? A Prospa Small Business Loan may be able to help you grow through challenging periods.

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