I'm after funding for a Car rental business

March 08, 2022

by a searcher from Victoria University in Geelong VIC, Australia

Hi, I'm after funding for a car rental business.

I'm based in Australia and funds required are around $10mil (large amount of that is held in assets.
We have come to a general consensus on the value, its now the terms. They have agreed to vendor finance but we have not yet given % as need to find out what we can get funded.

We know we can get $4mil is asset finance but need more to get the deal over the line.

Cheers

Amanda

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Reply by a searcher
from Victoria University in Geelong VIC, Australia

Thats great advise, in regards to putting the value on the vehicles my understanding is the finance companies here in Australia have only one or 2 ways of valuing. At this stage we have not determined the value of the fleet and need to decide on what we offer the vendor. So I'm assuming your saying it would be smarter to pay a lower valuation then current market or some how work out an ongoing pay out based on future vales of the vehicles. I would really appreciate any advise here.

Reply by a lender
from University of Technology Sydney in Sydney NSW, Australia

You can look at this as an asset backed business for banks, more likely non bank lenders, who would probably give you 50% - 70% in debt to fund it, but would want to see cash (hurt money) in addition to vendor finance. It is essentially an asset management business you are buying so also need to consider future working capital and funding for repairs, maintenance and increasing the fleet.

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