Manufacturers
Businesses with material trade debtors plus raw materials and WIP stock. ABL frees working capital without leaning on a bank overdraft.
Asset-based lending
Asset-based lending: multi-asset facilities for working capital depth.
Debtors, stock, plant, and property combined into a single revolving facility.
What it is
What asset-based lending means at Bedrock.
Asset-based lending pulls multiple collateral types into one facility. A typical ABL structure combines an invoice finance line against trade debtors with a stock loan against inventory, sometimes with a plant element layered on top. The aggregate availability is materially higher than any single product on its own.
ABL suits businesses with substantial working capital tied up in receivables and stock but a profit profile that bank cashflow facilities struggle to support. Acquisitive trading businesses, manufacturers with long cash-conversion cycles, and wholesalers carrying deep stock are the standard fits.
Pricing depends on the asset mix. Debtor-heavy facilities price closer to invoice finance levels. Stock and plant elements carry higher margins. We model the blended cost up front so the borrower can compare ABL against a stacked alternative on a like-for-like basis.
Who it's for
Common deal profiles.
Three patterns we see most often. The first conversation finds out which one you're closest to.
Wholesalers and distributors
Deep stock holdings against thin margin. ABL prices the stock as collateral rather than as a working-capital drain.
Acquirers and PE-backed groups
Buy-and-build operators using ABL as a flexible working-capital base across multiple trading subsidiaries.
How we structure it
Facility shape and timeline.
- Facility sizes
- £1m to £50m+ aggregate availability
- Typical structure
- Invoice finance line + stock loan + optional plant element + cash overlay
- Security
- Debenture, asset register, sometimes property charge as additional support
- Timeline
- Indicative terms once we've sounded out the right funders. Drawdown 4-8 weeks (asset audit drives the timeline).
Eligibility
What lenders look for in an ABL facility.
Asset-based lending is built for UK limited companies with a meaningful book of trade debtors and, usually, at least one other asset class: stock, plant and machinery, or property. The facilities Bedrock arranges start at around £1m of combined availability, so the debtor book and asset base need to be large enough to support that.
Lenders look at the quality of the debtor book (spread of customers, credit quality, payment history, disputes and credit notes), how stock is held and reported, the condition and resale market of any plant, and the strength of the management information. Reliable reporting matters more in ABL than in most products, because availability is recalculated against the asset values the business reports.
Profitability still matters, but less than for a cashflow loan. ABL often suits a business with strong assets and uneven earnings, such as a company in turnaround, a seasonal trader or a group that has just made an acquisition.
How it is sized
How an ABL facility is sized.
Each asset class is valued and advanced against separately. Eligible debtors are usually the largest and most liquid element. Stock is valued on what it would realise in an orderly sale, not its book cost, so finished goods with a ready market support more borrowing than work in progress. Plant and machinery are valued by an independent valuer, and property, where included, by a formal valuation.
The lender adds the separate availabilities together to set the total facility. Availability then moves with the business: as debtors and stock grow, so does the headroom. That is why ABL suits growing and acquisitive companies.
Before offering terms, most ABL lenders carry out a field audit of the debtor ledger and stock records. The audit and any asset valuations usually set the pace of the process more than credit approval does.
Costs
What ABL costs.
ABL pricing has several parts: a margin over a reference rate on the funds drawn, a service or management fee, and usually arrangement, audit and valuation fees. Debtor-heavy facilities price closer to invoice finance. Stock and plant elements carry higher margins because the lender's security is less liquid.
We set out the blended cost of the whole facility before you commit, so it can be compared like for like with an overdraft, a standalone invoice finance line or a term loan. We do not publish headline rates, because pricing depends on the asset mix, the facility size and each lender's current appetite.
Sectors
Sectors where this product fits.
The sectors below are where this product fits most often. Each links to a fuller sector page.
FAQ
Common questions.
Straight answers on how asset-based lending works for UK limited companies.
What is the difference between asset-based lending and invoice finance?
Invoice finance lends against trade debtors only. Asset-based lending starts with the debtor book and adds other assets, typically stock, plant and machinery and sometimes property, into a single facility. The result is usually more headroom than invoice finance alone, with one lender and one set of reporting.
Can stock be borrowed against?
Yes, within limits. Lenders value stock on what it would realise in an orderly sale, so finished goods with a ready resale market support more borrowing than raw materials or work in progress. Perishable, highly specialised or slow-moving stock may be excluded.
Is asset-based lending only for businesses in difficulty?
No. ABL is widely used by healthy manufacturers, wholesalers and acquisitive groups because availability grows with the business. It is also useful in refinancing and turnaround situations, where the asset base is stronger than recent earnings.
What reporting does an ABL lender need?
Expect regular debtor and stock reports, often monthly or more frequently, plus management accounts and periodic field audits. Good management information makes a facility easier to arrange and keeps availability accurate.
What size of business is ABL suitable for?
The facilities Bedrock arranges start at around £1m of combined availability. Below that, a standalone invoice finance facility or asset finance is often a simpler and cheaper fit.
Guides
Guides for this product.
Sector analysis from Bedrock on how this product is structured and underwritten in practice.
Food & BeverageStock and debtors in one facility: asset-based lending for food and drink producers
Why food and drink producers reach for asset-based lending, how perishability and grocer payment terms reshape what a lender will advance against stock, and where the borrowing base actually comes from.
PharmaceuticalsBatch stock plus trade debtors: asset-based lending for pharma manufacturers
How MHRA licensing, batch and lot control, expiry dating, cold-chain handling and controlled-drug status reshape what a lender will advance against pharmaceutical inventory, and why the debtor book usually carries the facility.
Retail & ConsumerFunding the channel shift: inventory and marketing capital for D2C brands
A scaling D2C brand burns cash in two places at once: stock bought ahead of demand and the ad spend that creates that demand. With no hard assets to secure against, the funding question is which lender underwrites the data instead.
- Retail & Consumer
Stock-heavy and seasonal: funding retail peak without over-borrowing
Christmas peak is bought in spring and paid for before it sells. The trick is sizing the facility to the demand you can clear, not the stock you can order, so January does not leave you financing pallets at full cost.
Need asset-based lending for your business?
Five minutes on a call gives us enough to come back with indicative options once we've sounded out the right funders.