Construction Factoring
Construction Factoring
Construction Factoring is a quick and easy way to ensure your business has working capital to complete projects.
- Been turned down by banks?
- Have contracts that you can’t fulfill?
- Is your debt contractual – We Can Fund You
“Construction Factoring is a fast and efficient way of funding your business and we fund industries where other funders can’t”
If you suffer from long payment terms, delays because of applications for payment or contractual issues that delay your revenue, then construction factoring could be right for you.
Construction factoring can help to speed up this chain, enabling your construction firm, regardless of size, to maintain a fluid credit facility. This allows you to continue to work on projects and make plans for the future.
As a contractor or sub-contractor, working within the parameters of a JCT contract and the complexities they bring can be difficult. The aim of the JCT contract is to improve the quality and standards within the construction industry, providing a standard working practice for all involved in the process.
The reality can often be much more challenging with structured staged payments, ‘Applications for Payment’ needing to be made and retention clauses holding anything up to 5% of a contract’s worth until the project has reached Practical Completion, sometimes months or years from when sub-contract works were completed.
Construction factoring is a specialized financial service designed to help construction companies manage cash flow effectively. It involves selling invoices to a third-party factor at a discount in exchange for immediate funds. This allows construction firms to access working capital quickly, which is crucial for covering payroll, purchasing materials, and meeting other operational expenses while waiting for clients to settle invoices.
Construction factoring is particularly beneficial in industries where payment terms are extended, ensuring that projects can progress smoothly without disruptions due to financial constraints. It also enables businesses to maintain liquidity and seize growth opportunities without additional debt.
- Construction factoring is a quick and effective method of releasing equity tied up in your invoices or ‘Applications for Payment’
- Factoring increases your cash flow and allows you to keep up with vital materials and operating costs
- Factoring allows you to outsource your credit control and ledger management, leaving you to focus on managing your business
- Construction factoring is confidential to avoid ban on assignment clause issues.
- Factoring companies can release funds ahead of Practical Completion on site, allowing you to move onto the next project without having to wait for funds to be released
- Factoring can assist with invoicing complex JCT contracts, allowing you to divert resources where they are needed most
- You can add bad debtor protection to your funding facility, providing peace of mind and stability
Construction factoring offers several benefits for businesses in the industry: It provides immediate access to cash flow by converting invoices into working capital, essential for covering daily operational expenses, payroll, and purchasing materials. This helps businesses maintain liquidity and ensures the continuity of projects without delays caused by late payments from clients. Construction factoring is a strategic move that eliminates waiting for extended payment terms.
This allows firms to shift their focus to growth and expansion opportunities. Moreover, it mitigates the risks associated with bad debts and non-payment, as the factor assumes responsibility for collections. Factoring services often include credit checks on clients, which helps businesses make informed decisions about extending credit terms. Overall, construction factoring provides a flexible financing solution that supports ongoing operations and facilitates sustainable growth in the competitive construction industry.
What are the benefits of Construction Factoring for my business?
What are the benefits of Construction Factoring for my business?
- Construction factoring is a quick and effective method of releasing equity tied up in your invoices or ‘Applications for Payment’
- Factoring increases your cash flow and allows you to keep up with vital materials and operating costs
- Factoring allows you to outsource your credit control and ledger management, leaving you to focus on managing your business
- Construction factoring is confidential to avoid ban on assignment clause issues.
- Factoring companies can release funds ahead of Practical Completion on site, allowing you to move onto the next project without having to wait for funds to be released
- Factoring can assist with invoicing complex JCT contracts, allowing you to divert resources where they are needed most
- You can add bad debtor protection to your funding facility, providing peace of mind and stability
Construction factoring offers several benefits for businesses in the industry: It provides immediate access to cash flow by converting invoices into working capital, essential for covering daily operational expenses, payroll, and purchasing materials. This helps businesses maintain liquidity and ensures the continuity of projects without delays caused by late payments from clients. Construction factoring is a strategic move that eliminates waiting for extended payment terms.
This allows firms to shift their focus to growth and expansion opportunities. Moreover, it mitigates the risks associated with bad debts and non-payment, as the factor assumes responsibility for collections. Factoring services often include credit checks on clients, which helps businesses make informed decisions about extending credit terms. Overall, construction factoring provides a flexible financing solution that supports ongoing operations and facilitates sustainable growth in the competitive construction industry.
How can Simply Factoring Brokers help?
The clauses of a construction contract often make debts un-factorable. We understand that invoicing / application for payment, is not always a straightforward process. We introduce you to factoring companies who work with construction firms like yours.
Our funders specialise in arranging construction finance solutions in sensitive circumstances, where you may not wish your customers to know all of your financial arrangements. Our funders provide a confidential finance service.
For more information on Construction Factoring and how it can help you to build your business, speak to our team of specialist brokers by giving us a call or chat with a live representative.
We make your business our business.
If you would like to get know how factoring can help your business grow, call 0333 772 1558.
Simply Factoring Brokers can play a crucial role in helping businesses navigate the complexities of invoice factoring. As experienced intermediaries, they act as liaisons between construction firms and factoring companies, facilitating the process of securing favorable financing arrangements. Simply Factoring Brokers leverage their industry expertise and extensive network of factoring providers to match businesses with the most suitable solutions tailored to their needs.
They streamline the application process, negotiate competitive rates and terms, and ensure transparency in fee structures. By partnering with Simply Factoring Brokers, businesses gain access to expert advice and personalized service that simplifies the complexities of financial transactions, allowing them to focus on core operations and achieve sustainable growth.