Finance for Electrical Contractors

Working as an electrical contractor usually means that you will be bringing in suppliers to do the work before you get paid for the job. It means delays and a drain on your cash flow. A short contract could be complete before you receive any of the funds you need from your client - and it could even put you in the position of having to turn work down if you can’t afford to fund the materials you need.

Of course, you probably have relationships with suppliers who can let you have the supplies you need - but even if you do have suppliers who are prepared to advance you credit, the chances are that their prices will reflect the costs of waiting for their payment. You could be paying more than you need.

At Rangewell, we believe there is a better solution. Negotiate the best price from your suppliers - and borrow the funds to pay in cash.

• You avoid the need to find cash upfront - in effect funding your clients' project
• You can spread the repayments until you are paid for the work
• You can afford to take on any scale of project
• You can avoid cashflow problems
• Work with clients with long payment terms, or those who pay late
• Protect against customer insolvency with Bad Debt Protection
• You can negotiate larger discounts - increasing your competitiveness and profits

Funding for all types of electrical supplies

On a domestic project, where you simply need cables a consumer unit and terminals, the costs may not be too large to deal with. But on major developments with dozens or even hundreds of homes, those costs will be multiplied. What’s more, the growing complexity of modern buildings means that the cost of electrical systems is increasing.

We can help you find funding for all types of electrical building supplies, including:

• Cabling
• Consumer units
• HVAC (Heating, ventilation and air conditioning)
• Security systems
• Lighting systems
• Lighting units
• Data cabling

Finding funding options with Rangewell

Many lenders find providing finance for the building industry difficult. At Rangewell, we know lenders who will work in the sector and can provide cost-effective funding options for your needs - whether you are the main contractor, specialist contractor or sub-contractor.

• Unsecured loans
• Secured loans
• Contract funding

Lending can provide a cost-effective solution in some circumstances - talking to a Rangewell expert will help you understand what they are.

There are two basic types of business loans, which can be used for any business purpose and can provide a simple way to provide the electrical supplies you need.

Unsecured business loans

Unsecured lending can be suitable for costs up to around £250,000. They operate much like a personal loan and will require a personal guarantee from the directors of your business. Rates start at around 6% and it may be possible to arrange repayments to fit your contract, including providing lump-sum repayments when your client pays you.

It may be possible to arrange an Unsecured Loan in a matter of days with some lenders.

Secured Loans

Secured Loans are ‘secured’ because the lender will require security in case you cannot pay the loan back. This could be your home or your business premises. They can be used to borrow large sums. Because security reduces the risk for lenders, interest rates tend to be significantly lower than Unsecured lending. Current rates may be as low as 2% over base rate.

Again, repayment terms can be agreed when you arrange your loan - although Secured Loans may take a little longer to arrange.

Contract Finance

Contract Finance acts to advance funds against your future billing - in effect, using the value of your contract as the security for a loan, which you can use to pay for the supplies you need. It can even help protect your business against unexpected late payments or project delays.

With Contract Finance, the finance company will expect to see a detailed contract from a reputable end customer. They will want to ensure that your customer will be able to pay for the work once the contract has been completed.

This means that it is the credit rating of your end customer, rather than that of your own business, which will be central to securing the finance you need. Working for a large organisation, such as a major developer, a local authority or a central government organisation, might all be ideal.

Contract Funding is considered riskier than purchase order or production finance as the client may need to fulfil the entire contract to be paid. Costs are therefore a little higher to reflect the additional risk.

How we help you capitalise your electrical business

At Rangewell, we work across the entire lending industry and our finance experts have personal experience of different business sectors. Our team knows the lenders who specialise in finance for the construction industry.

We put this knowledge to work for you, finding the most competitive deals for the supplies you need. It lets us ensure that we find you the most appropriate financial solutions you need to capitalise your business.

As well as conventional finance products, we can help you find Alternative Funding, using new loan providers and styles of funding.

Whether you have a straightforward finance need or require a complicated ‘Jigsaw’ funding plan made up of a combination of lending types, we have the answers you need.

Simply call us now to find out more about any type of construction finance for your business.