Food company prepares for future with strengthened financial base

A Lancashire foods business has secured a seven-figure funding boost with the aid of Oldham-based PMD Business Finance.

PMD worked on sourcing the asset-based lending facility to assist with the ongoing growth of Laila’s Fine Foods.

From humble beginnings in Laila Remtulla’s kitchen 30 years ago, to a 96,000 sq ft purpose-built factory in Bispham, Lancashire, Laila’s family business has grown impressively.

The venture is a long-standing manufacturer of hand-prepared ready meals based around small batch production.

Even with more than 350 staff working around 260 product ranges, the firm says it has managed to keep true the meaning of high-quality home cooking.

The business has seen strong growth over the years, fuelled by customer loyalty, including a range of leading supermarkets.

However, it felt it was not getting the financial support it needed to progress from its existing bankers.

PMD initially sourced a six figure asset refinancing facility to support working capital.

Callum Bull, PMD business development director, said: “Laila’s Fine Foods has invested heavily over the years to ensure they remain at the forefront of the sector and have the ability to meet the high demands of their client base.

“However, this also meant that the company had a large amount of equity tied up in a wide range of unencumbered equipment.

“An asset refinancing facility was, therefore, the ideal solution, as it allowed funds to be raised against this equipment helping to protect the company’s cash flow, whilst providing the lender with adequate security.”

However, due to the unprecedented outbreak of COVID-19, the business was rapidly trying to ramp up production to serve a spike in demand for its products.

But this required the funds to cope with the heightened production levels.

Callum Bull introduced Mark Millhouse, head of invoice finance at PMD, who assessed the existing facility and identified a more appropriate alternative – to switch the invoice finance providers, saving costs and increasing facility size.

Mr Millhouse said: “The invoice finance facility Laila’s had in place was restrictive in the amount of funds it generated and had far too onerous levels of administration as a condition.

PMD team, from left: Tom Brown, Callum Bull and Mark Millhouse

“PMD quickly identified a lender with sector experience and an old-fashioned approach to underwriting, putting the people at the heart of the facility.

“Despite the COVID-19 crisis, a survey was able to be done remotely and e-documents signed resulting in no additional time lost. The deal completed within two weeks from first meeting, and Laila’s now has the required headroom in the facility to allow them to grow.”

While times have been difficult for Laila’s, the company has come out the other side positive. Zera Dawson-Gerrard, technical & commercial director at Laila’s, said: “We have had a number of challenges over the past 18 months, with Brexit and now COVID-19.

“Both Callum and Mark worked tirelessly to fully understand our business and secure the financing that we needed to support our growth ambitions.

“We are able to remain close to our customers during these uncertain times and are able to keep up the quality of service that we are used to delivering.”