Can co‑packers, ghost kitchens and meal‑kit producers get working capital via UK business loans?

Short answer: Yes — most established co‑packers, ghost kitchens and meal‑kit producers can access working capital through UK business finance channels, but the right route depends on your business model, customers (B2B vs D2C), trading history and contract strength. Typical options include invoice finance, asset & equipment finance, merchant cash advances, short‑term overdrafts and secured or unsecured term loans (from around £10,000+). To see what you might qualify for, complete a Free Eligibility Check and we’ll match you to lenders and brokers who understand the food sector: Get Quote Now — Free Eligibility Check.

Who we mean by “co‑packers, ghost kitchens and meal‑kit producers”

These three models overlap but have distinct funding profiles:

• Co‑packers (contract packers) manufacture or package products for brands and retailers. They are typically B2B, invoice supermarkets, wholesalers or brands and may operate on thin margins but large volumes.
• Ghost kitchens are delivery‑only kitchens running one or more virtual brands via delivery marketplaces. Income is often card sales and marketplace revenue; speed and flexibility matter more than fixed premises.
• Meal‑kit producers sell pre‑packed recipe kits to consumers — either subscription or one‑off D2C sales. They need working capital for stock, packing runs and marketing, and are judged on subscription metrics (LTV, churn).

Why it matters: lenders evaluate B2B invoice profiles differently to D2C card volumes and subscription models. Choose finance that matches how you get paid.

Typical working capital needs in the food industry

Food businesses commonly require funding for:

• Day‑to‑day cashflow gaps (supplier bills, payroll, utility peaks)
• Ingredient pre‑purchases and seasonal stock builds
• Packaging runs, bespoke labels and minimum order quantities
• Equipment: ovens, packing lines, chillers, delivery vans
• Expansion: new kitchen sites, product launches, marketing to scale subscriptions

Perishability and tight supplier terms increase cashflow pressure; predictable invoices or strong card sales reduce lender risk.

Which finance solutions can help?

Below are practical funding routes, when they suit your business and their pros/cons.

Invoice finance / factoring

What it is: Lenders advance a percentage of your outstanding invoices (typically 70–90%) and manage collections (factoring) or simply advance funds (invoice discounting).

Best for: Co‑packers or producers who invoice retailers, brands or wholesalers on 30–120 day terms.

Pros: Rapid liquidity tied to sales; scales with invoices. Cons: Fees and interest, suitable only with creditworthy buyers or diversified debtor book.

Asset & equipment finance

What it is: Hire purchase or lease arrangements to fund ovens, pack lines, fridges or vehicles.

Best for: Businesses that need fixed equipment but want to spread cost over 2–7 years.

Pros: Conserves working capital; financing often secured against the asset. Cons: Asset acts as security; ownership may transfer after final payment.

Term business loans (secured & unsecured)

What it is: Fixed‑term lending for investment or longer cashflow needs.

Best for: Established businesses with clear profits and management accounts. Amounts typically start from around £10,000 upwards.

Pros: Predictable repayments; often lower cost than merchant cash advances. Cons: May require director guarantees or security.

Merchant cash advance / revenue‑based finance

What it is: Advance against future card sales; repayments taken as a fixed % of daily takings.

Best for: Ghost kitchens and D2C meal‑kit producers with steady card volumes but limited trading history.

Pros: Very fast access to cash. Cons: Higher cost, variable daily repayments can pressure cashflow.

Overdrafts & short‑term lines

What it is: Revolving credit to cover short gaps.

Best for: Seasonal swings or one‑off supplier payments.

Stock & supplier financing

What it is: Supplier credit, purchase order finance or prepayment facilities that cover raw material purchases.

Best for: Ingredient‑heavy producers needing to buy in bulk at discounts.

Tip: Combining products is common — e.g., invoice finance for day‑to‑day cashflow and asset finance to buy a new pack line.

For an industry‑specific overview of lending for food sector businesses, see our dedicated food industry page on food industry business loans: food industry business loans.

Eligibility — what lenders typically look for

Lenders assess risk using both financials and operational indicators:

• Trading history — many lenders prefer 12+ months trading, but some revenue‑based products help newer businesses.
• Turnover and gross margins — ability to service repayments is key.
• Buyer strength — invoices to supermarkets or major wholesalers improve access to invoice finance.
• Card sales history — daily/weekly card turnover data helps with MCA or revenue finance.
• Food safety & quality accreditations — BRC, SALSA, HACCP or equivalent reassure lenders about continuity and risk.
• Management accounts, VAT returns and bank statements — these are standard document requests.

Meal‑kit subscription metrics (cohort LTV, churn, CAC) are particularly important for growth funding.

Typical terms, costs and timelines

Timelines:

• Quick eligibility check and quotes — often within hours after enquiry.
• Invoice finance or MCA — funds available in days once due diligence is complete.
• Asset finance or term loans — typically 1–4 weeks depending on security and valuation.

Costs (illustrative and variable):

• Invoice finance: advance rates 70–90% of invoice; fees and interest vary by risk and buyer credit.
• Asset finance: structured payments or interest over 2–5 years; dependent on asset age and value.
• Merchant cash advance: higher effective APRs — fast access but costlier.
• Term loans: rates dependent on credit profile, security and lender; secured loans usually cheaper than unsecured.

Always read the lender’s terms and compare quotes. UK Business Loans helps you collect multiple quotes to compare.

Common objections & how to improve your chances

Frequent obstacles and remedies:

• Poor credit history — explain circumstances, show recent performance improvements and provide business forecasts.
• Short trading history — use revenue‑based finance or asset finance that considers cash sales and the asset value.
• High buyer concentration — secure longer contracts, diversify customers or provide buyer agreements to lenders.
• Seasonal volatility — supply accurate forecasts and propose seasonal facilities (e.g., seasonal overdraft).

Quick checklist to have ready for an enquiry:

• Company registration & VAT details
• 3–6 months business bank statements
• Latest management accounts or profit & loss
• Copies of major customer contracts or PO’s
• Details of assets (age, value) and any existing borrowing
• Food safety accreditations (BRC, HACCP, SALSA)

How UK Business Loans helps food businesses

UK Business Loans does not lend. We match your business to the lenders and brokers most likely to offer suitable terms for your needs. Our process is simple and quick:

1. Complete a short enquiry (takes around 2 minutes).
2. We match your details to lenders/brokers experienced in the food sector.
3. You receive calls/emails from matched partners with quotes and next steps.

Submitting an enquiry is free, not an application, and does not affect your credit score. We aim to save time, increase the chance of a suitable offer and get you a fast response. Ready to check eligibility? Get Started — Free Eligibility Check.

Case studies (short)

Co‑packer (anonymous) — Problem: retailer invoices paid on 60 days caused cash shortfall for a new packing run. Solution: Invoice finance advanced 85% of invoices. Outcome: immediate cash to buy packaging, one month of uninterrupted production and improved supplier terms.

Ghost kitchen (anonymous) — Problem: rapid demand required extra kitchen and a delivery van. Solution: Asset finance for the van and a short‑term merchant cash advance to cover fit‑out. Outcome: expanded delivery area and 30% uplift in weekly revenue.

Frequently asked questions

Can a start‑up ghost kitchen get a business loan?

Start‑ups may struggle with traditional term loans but can often access revenue‑based finance, crowdfunding, equipment finance or short‑term facilities if they can demonstrate card sales and a clear plan. Discuss your profile via our Free Eligibility Check: Free Eligibility Check.

Are food safety accreditations important?

Yes — certifications like BRC, HACCP or SALSA reduce perceived operational risk and improve access to larger lenders and better rates.

What is invoice finance and will it work for co‑packers?

Invoice finance unlocks cash tied to trade invoices. It works well for co‑packers billing supermarkets, wholesalers or brands on credit terms, especially when buyers have strong credit profiles.

How quickly will I hear from potential lenders?

After you submit an enquiry you can often hear back within hours; detailed offers may take a few days depending on due diligence.

Will applying through UK Business Loans affect my credit score?

No — the initial enquiry is non‑credit scoring. Lenders may run checks later if you choose to proceed.

Next steps & legal notice

If you need working capital for production runs, equipment, vehicles or to smooth cashflow, start with a short enquiry. It takes around 2 minutes and is free — we’ll match you with lenders or brokers who focus on the food sector and can provide quotes.

Get Quote Now — Free Eligibility Check

UK Business Loans is an introducer and does not lend money or provide regulated financial advice. Submitting an enquiry is not an application and will not affect your credit score. Lenders may carry out credit checks if you proceed. Typical finance amounts we help organise start from around £10,000 and up. Read our Privacy Policy for details on how we handle your information.

1. Can co‑packers, ghost kitchens and meal‑kit producers get business loans or working capital? – Yes — most can access working capital through products like invoice finance, asset finance, merchant cash advances, overdrafts and term loans, and UK Business Loans can match you to suitable lenders via a free eligibility check.

2. Will submitting a UK Business Loans enquiry affect my credit score? – No — the initial enquiry is non‑credit scoring and won’t affect your credit file, though individual lenders may carry out checks later if you proceed.

3. What types of business finance are best for food businesses? – Invoice finance is ideal for B2B co‑packers, asset/equipment finance suits ovens and pack lines, merchant cash advances suit card‑heavy ghost kitchens and D2C meal‑kits, while term loans and overdrafts help established businesses and seasonal needs.

4. How much can I typically borrow for a food business in the UK? – Typical amounts start from around £10,000 and can scale up into six or seven figures depending on lender, product and your business profile.

5. What documents should I have ready to apply for a business loan? – Have company registration and VAT details, 3–6 months business bank statements, latest management accounts or profit & loss, VAT returns, major customer contracts or POs, asset details, director ID and any food safety accreditations.

6. How quickly can I get funds for working capital? – You can often hear back from matched lenders within hours, with invoice finance or MCAs funding in days and asset or term loan drawdowns typically taking 1–4 weeks after due diligence.

7. Can start‑up ghost kitchens and meal‑kit producers access funding? – Yes — start‑ups can often use revenue‑based finance, equipment finance, specialist start‑up lenders or crowdfunding if they can evidence card sales, pre‑orders or provide asset security and a clear plan.

8. Do food safety accreditations affect loan eligibility? – Yes — BRC, HACCP, SALSA and similar certifications reduce perceived operational risk and can improve access to larger lenders and better rates.

9. Is invoice finance suitable for co‑packers with long retailer payment terms? – Yes — invoice finance or factoring is designed to unlock cash tied to invoices for co‑packers invoicing supermarkets, wholesalers or brands on 30–120 day terms, especially when buyers have strong credit.

10. How can I improve my chances of getting a business loan for a food business? – Improve your prospects by supplying clear management accounts and bank statements, securing or evidencing long‑term customer contracts, holding food safety accreditations, demonstrating stable card or invoice receipts, and considering asset security or director guarantees.