What is Construction Finance?Published on 14th November 2017 - Last update on 22nd November 2018
Although the construction industry is one the UK’s fastest growing sectors it still needs a helping hand now and then. No matter how big or small the scale of your project may be, it still requires a substantial commitment of building supplies, heavy equipment and skilled labourers. However, that also means ensuring that you have enough cash to see each stage of construction through to the end, which can prove challenging. But rather than using your own cash reserves, you could take a different route. By applying for Construction Finance you could spread out the cost of purchasing equipment and supplies, unlock equity in your existing assets or even gain the cash owed to your business early. So, if Construction Finance sounds like something that could benefit your construction firm, here’s what you need to know:
- What is Construction Finance?
- How to gain equipment?
- How to acquire extra supplies?
- How to release equity?
- How to obtain money owed early?
What is Construction Finance?
Construction Finance is a unique, industry-specific package that gives builders, contractors, real estate developers to renovation firms the ability to gain the resources they need. If your business operates in the construction sector, Construction Finance can help you carry out a range of different tasks, such as purchasing or hiring equipment, acquiring essential building supplies, releasing equity and paying staff wages. Just some of the products available to your business include Hire Purchase, Leasing, Asset Refinance, Factoring, Discounting and Revolving Credit Facilities. So whether you’re building affordable housing, renovating shop interiors or constructing a new warehouse, you can get it done in total confidence with Construction Finance.
How can I get hold of more equipment?
In order to ensure that you can carry out any given task, whilst delivering a high-quality finish, access to vital pieces of equipment is essential. Over time, the equipment that you already own may fall victim to wear and tear or become obsolete as more advanced models are released. This would mean having to purchase new equipment, machinery or vehicles, putting your finances under pressure, especially if you run a developing SME business. However, with Construction Finance, you have the ability to borrow, gain ownership of valuables assets over time or use the equity stored in the assets that you already own outright to fund and support purchases. So, whether your business needs anything, from additional power tool kits, diggers and dozers to cranes, construction finance can pave the way forward.
How can I refresh my building supplies?
During any building contract, you’re going to need to make sure you have sufficient quantities of building supplies, but there could be times when you’ve simply underestimated how much you needed or the job was larger than you first thought. Although the individual cost may seem minimal at the time, they can soon mount up if you’re ordering in bulk. This can be a frustrating time for any construction firm, but there is a way that you can overcome this challenge. Construction Finance can also help you access and spread out the cost of supplies by allowing you to either receive the cash owed to your business in unpaid invoices or releasing the equity contained in your encumbered business assets, such as equity, machinery, vehicles and property.
How can I gain access to cash through my existing assets?
Another aspect to consider may involve ensuring that you have enough cash to progress through each phase of a construction. One issue that your construction firm could encounter may relate to overheads, as a direct or indirect consequence of the project you’re currently working on. Direct expenses are costs that are incurred by your on-site staff and equipment, temporary offices, contractor salaries, equipment rental, site inspections and temporary accommodation. Meanwhile, your indirect expenses typically come as a result of your main office and off-site personnel from rent, staff salaries, bookkeeping, administration, marketing, insurance and so on. Naturally, these costs can mount up and cause any number of problems that may impede your project’s progression.
However, Construction Finance could help you resolve this crisis by allowing you to unlock early the money contained in your business’s unpaid business-to-business (B2B) invoices, which are worth in excess of £5,000, using Invoice Finance. Alternatively, you could also apply for a line of credit using a Revolving Credit Facility. Similar to a credit card, it offers you access to a set allowance each month that can be withdrawn, repaid and withdrawn again so that you can cover these costs whenever the need arises.
In need of Construction Finance?
Acquiring the funds you need can be a challenge if you don’t know how. Running a business in construction, you can run into any number of issues, including the need for more equipment, funding projects at each stage of development or paying wages. Rather than exhausting large sums of cash from your business’ capital, Construction Finance could provide you with funds and means necessary to take your business forward. So, if you’ve got a construction job in the pipeline and need equipment, or are simply in need of cash, apply for Construction Finance today, or find out more with Rangewell.
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