According to the Construction Equipment Association (CEA), in a press release dated the 29th of April 2019, the UK’s construction sector occupies the top spot in Europe with a 24% share of the total market.
The UK is also ranked 5th in the world and earns an estimated £13 billion in sales. Within the UK, at least, particularly favourable construction equipment financing rates significantly help maintain a buoyant market.
There are a number of major infrastructure projects fuelling this impressive performance. But it also continues to be stimulated by countless housing projects – large and small – across the country.
How well-placed is your own construction company?
Whether you are a large, medium or small construction firm, much of what you do depends on the equipment you have at your disposal.
A lot of that equipment is neither cheap nor have a long, useful working life. Plus, there always seems to be new or replacement equipment needed to be able to fulfil your contracts.
Where is that money going to come from?
Your balance of working capital may be an obvious choice. But there are many very good reasons for not tapping into that finely managed source of funding.
External funding for your construction equipment purchases then becomes a possibility. With a number of options you might want to pursue:
The assets you already own represent a wealth of stored-up value.
Asset finance offers a way of releasing that value, while still leaving you the exclusive use of the assets concerned.
Effectively, you are borrowing by way of offering the assets you own as collateral against further borrowing.
This not only gives any potential lender the confidence and reassurance of the security you have pledged but it’s also likely to result in a lower rate of borrowing. In turn, making what you pay for your construction equipment financing rates more attractive.
But there are assets other than the equipment you already own which can also open the door to the additional finance you need.
Those assets lie in the invoices receivable from your customers. Many of whom may be notoriously tardy when it comes to paying on construction project phases.
A specialist invoice factor, however, may agree to advance a cash sum against a proportion. Which can be up to 95% of the value of those invoices receivable.
This gives you immediate access to the cash you need. Plus, it gives you the ease and convenience of repaying the factor’s advance as and when the invoices are paid.
When you’ve previously looked for extra financing you might have turned straight to your bank.
But banks have become somewhat warier of business lending in recent years. Here at Peak Business Finance, we can help you to identify the competitive rates offered by those banks still eager to lend. Not to mention the wide variety of alternative financing solutions available to you.
Favourable construction equipment financing rates can open the door to the funding you need. Enabling you to invest in the machinery and equipment your next construction projects require.