A worked example: how a UK SME used a £150,000 revolving credit facility
Worked examples cut through the theory in a way that definitions and comparisons cannot. If you are evaluating whether a revolving credit facility is the right product for your business, seeing a concrete six-month narrative with real numbers, real draw-down events, and a real cost calculation is often more useful than any amount of general explanation.
What follows is a fictitious but realistic scenario: a UK SME using a £150,000 Juice Flex revolving credit facility across six months of typical business activity.
Meet the business: Thornfield Interiors
Business: Commercial interiors contractor Location: Birmingham Annual revenue: ~£3.2M Employees: 22 full-time, plus subcontractors Challenge: Project-based revenue creates large cash flow timing gaps. Costs hit early, client payments arrive late.
Thornfield Interiors has been trading for eight years. Their business model is project-based: they win contracts, buy materials, hire subcontractors, complete the work, and invoice the client on completion or in staged instalments. The gap between spending money and receiving it is typically 45 to 90 days per project.
They had used a bank overdraft for years, but it was limited to £40,000, not enough during busy periods when multiple projects overlapped. In January, they took out a £150,000 Juice Flex revolving credit facility to give them genuine working capital headroom.
Month 1: January — two projects running simultaneously
Thornfield had two active contracts in January: a restaurant refurbishment worth £180,000 and an office fit-out worth £95,000.
Cash flow situation: - Materials needed upfront for both projects: £65,000 - Subcontractor payments due mid-month: £18,000 - Expected client payments: first staged payment from the restaurant project (£54,000) due at end of month
Draw-down activity:
| Date | Event | Amount | Outstanding | Available |
|---|---|---|---|---|
| 3 Jan | Draw down — materials for restaurant project | +£45,000 | £45,000 | £105,000 |
| 11 Jan | Draw down — materials for office fit-out | +£20,000 | £65,000 | £85,000 |
| 16 Jan | Draw down — subcontractor payments | +£18,000 | £83,000 | £67,000 |
| 29 Jan | Repayment — restaurant stage payment received | −£50,000 | £33,000 | £117,000 |
End of January: Outstanding balance £33,000. Average balance over the month: approximately £55,000.
Estimated interest cost for January (illustrative, at 18% annual rate): - ~£55,000 average balance × (18% ÷ 365) × 31 days = £840
Month 2: February — large material order, payment delayed
February brought a supply chain surprise. The materials supplier for the office fit-out offered a 6% early payment discount on a large batch order, but only if Thornfield paid within five days. The batch was worth £48,000, so the saving was £2,880.
The client payment covering this contract phase was not due for another six weeks. Without the revolving facility, they would have had to turn down the discount or pay late and lose it.
Draw-down activity:
| Date | Event | Amount | Outstanding | Available |
|---|---|---|---|---|
| 5 Feb | Draw down — bulk material order (early payment discount) | +£48,000 | £81,000 | £69,000 |
| 18 Feb | Draw down — payroll top-up (busy month) | +£12,000 | £93,000 | £57,000 |
| 27 Feb | Repayment — restaurant final stage payment received | −£40,000 | £53,000 | £97,000 |
End of February: Outstanding balance £53,000. Average balance: approximately £70,000.
Estimated interest cost for February: - ~£70,000 × (18% ÷ 365) × 28 days = £965
Net position: The facility cost ~£965 in interest this month, but the early payment discount captured was £2,880. Net saving from using the facility: £1,915.
Month 3: March — quiet period, balance reduced aggressively
March was a relatively quiet trading month. The restaurant project was complete, the office fit-out was in finishing stages, and no new contracts had started. Cash flow was positive and Thornfield used the opportunity to pay down the facility.
Draw-down activity:
| Date | Event | Amount | Outstanding | Available |
|---|---|---|---|---|
| 14 Mar | Repayment — office fit-out stage payment received | −£35,000 | £18,000 | £132,000 |
| 22 Mar | Draw down — VAT quarter payment | +£22,000 | £40,000 | £110,000 |
| 28 Mar | Repayment — cash flow positive, paying down | −£20,000 | £20,000 | £130,000 |
End of March: Outstanding balance £20,000. Average balance: approximately £32,000.
Estimated interest cost for March: - ~£32,000 × (18% ÷ 365) × 31 days = £488
Note: The VAT bill would have been a serious cash flow problem without the facility, or would have required using trading cash that was needed for other purposes. The draw-down covered it cleanly and was partially repaid within the same month.
Month 4: April — new contract win, large mobilisation cost
In early April, Thornfield won a large contract: a £320,000 hotel lobby refurbishment. Mobilisation costs (initial materials, a specialist subcontractor deposit, and tool hire) were £75,000. The first stage payment from the client was not due for 45 days.
Draw-down activity:
| Date | Event | Amount | Outstanding | Available |
|---|---|---|---|---|
| 8 Apr | Draw down — hotel project mobilisation | +£75,000 | £95,000 | £55,000 |
| 20 Apr | Draw down — additional subcontractor payment | +£15,000 | £110,000 | £40,000 |
| 28 Apr | Repayment — office fit-out final payment received | −£30,000 | £80,000 | £70,000 |
End of April: Outstanding balance £80,000. Average balance: approximately £65,000.
Estimated interest cost for April: - ~£65,000 × (18% ÷ 365) × 30 days = £964
Without the revolving facility, Thornfield could not have mobilised this contract at speed. They would have needed to either delay start (risking the contract relationship) or turn down a project worth £320,000 in revenue.
Month 5: May — first stage payments arrive, balance falls
The hotel project's first stage payment (£96,000) arrived mid-May. Thornfield made a large repayment and used the facility for ongoing project costs at a lower level.
Draw-down activity:
| Date | Event | Amount | Outstanding | Available |
|---|---|---|---|---|
| 15 May | Repayment — hotel stage payment received | −£75,000 | £5,000 | £145,000 |
| 22 May | Draw down — ongoing site costs | +£18,000 | £23,000 | £127,000 |
End of May: Outstanding balance £23,000. Average balance: approximately £45,000.
Estimated interest cost for May: - ~£45,000 × (18% ÷ 365) × 31 days = £687
Month 6: June — facility largely clear, reserved for next mobilisation
By June, the facility was running at a low balance. Thornfield drew small amounts for running costs and made minor repayments as project income arrived.
| Date | Event | Amount | Outstanding | Available |
|---|---|---|---|---|
| 10 Jun | Repayment — partial | −£15,000 | £8,000 | £142,000 |
| 24 Jun | Draw down — subcontractor payment | +£10,000 | £18,000 | £132,000 |
End of June: Outstanding balance £18,000.
Estimated interest cost for June: - ~£14,000 × (18% ÷ 365) × 30 days = £207
Six-month summary
| Month | Peak Outstanding | Average Balance | Est. Interest Cost |
|---|---|---|---|
| January | £83,000 | £55,000 | £840 |
| February | £93,000 | £70,000 | £965 |
| March | £40,000 | £32,000 | £488 |
| April | £110,000 | £65,000 | £964 |
| May | £80,000 | £45,000 | £687 |
| June | £23,000 | £14,000 | £207 |
| Total | £110,000 (peak) | ~£47,000 | ~£4,151 |
Total interest paid across six months: approximately £4,151.
Total capital accessed across the period: over £300,000 in individual draw-downs (reused as repaid and redrawn).
What would the alternative have looked like?
If Thornfield had instead taken out a term loan of £110,000 (the peak amount they needed) at the start of the period:
- Interest on £110,000 at 18% for 6 months: approximately £9,900
- Fixed monthly repayments: approximately £19,000/month (principal + interest on a 6-month term)
- In February, March, and June, when cash flow was positive, they would still have owed the same fixed repayment
- They would have had to apply separately for the VAT quarter funding in March
Estimated comparable term loan cost for the same period: ~£9,900 in interest alone, with much more cash flow pressure from fixed monthly repayments.
The revolving facility approach cost approximately 58% less in interest, while giving them access to more capital at the moments they actually needed it.
(Figures are illustrative. Actual costs depend on your facility terms and individual circumstances.)
What this example shows
Thornfield Interiors used their Juice Flex facility to:
- Bridge supplier-to-client timing gaps, the core use case for working capital finance
- Capture a discount opportunity (February) that directly paid for the facility cost and more
- Cover a VAT bill without disrupting operations (March)
- Mobilise a large new contract at speed (April), the most valuable event in the six months
- Keep total interest cost low by repaying aggressively during positive cash flow periods
The facility was never drawn to its full limit. It did not need to be. The value was not in always using it, but in having it available at exactly the right moments.
Apply for Juice Flex
Juice Flex revolving credit facilities from £25,000 to £1,000,000. Apply in minutes at app.getmejuice.com/sign-up — no impact to your credit score to check eligibility.
For more on this topic, explore our How Does Revolving Credit Work resource hub.
Subject to status and lending criteria. Juice Flex is provided by Juice Ventures Limited, registered with the Financial Conduct Authority. Thornfield Interiors is a fictitious business used for illustrative purposes only. Interest rates are illustrative and do not represent rates available on any specific Juice Flex product. Actual rates depend on individual circumstances.