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• 06 Oct

  The Benefits Of Construction Finance

  If you are a contractor or sub-contractor, providing services to a main contractor within the construction sector, you may have experienced the ongoing cash flow pressures that can come from projects within the sector. Upfront labour and materials costs often need to be paid in advance, before you get paid for the job.

  Additionally, you can have the normal ongoing, day-to-day business costs to meet during the delivery phase of a large project. We often help companies that would otherwise have to turn down a large contract.

  Construction finance is an ongoing source of funding, throughout the various stages of a contract, including payment applications, before certification.

  Contracts

  It can be particularly helpful if your company is missing out on work because of a lack of funds, or if you have had to turn away large contracts because you cannot fund the costs associated with fulfilment. If you work under a contract, framework agreement or purchase order (PO), and it is affecting your cash flow, this is a solution.

  The Benefits Of Construction Finance

  There are a number of benefits of construction finance, which are as follows:

  • Improved cash flow by releasing the money that is tied up in unpaid sales invoices or uncertified applications for payment. That money can be put to work in your business for tasks such as purchasing labour or purchasing materials, in order to get your contracts fulfilled.
    
    
  • You will have access to industry sector specialists who know how businesses like yours work and can help you source the funding you need to improve your cash flow.
    
    
  • You will get help reviewing your contracts from experts who will ensure there are no clauses that could come back to cause you problems in the future.
    
    
  • Additional credit control help, if you would like to hand over the task of chasing unpaid accounts receivable to a team of professionals. Or you may want to conduct this function yourself. You can also choose optional bad debt protection, to protect your cash flow if your customers fail which can be a concern within the sector.
    
    
  • Additionally, you could benefit from asset finance to buy equipment. This will remove the large upfront costs involved with buying equipment. These costs can be spread over extended periods of time, to inject further liquidity into your company.

  By Glenn Blackman