Case Study: Fast-paced growth for a civil engineering business

The Challenge

The construction business faced an intense period of fast-paced growth as they secured multiple new contracts that promised to elevate their market position. However, this sudden influx of opportunities created a pressing need for an expanded equipment fleet to ensure they could meet project demands efficiently and effectively. The company was primarily renting equipment, which resulted in high overhead costs that cut into their profit margins.

Compounding the issue was a tight cash flow situation, which was exacerbated by the seasonal nature of construction work and the need for upfront capital to secure contracts. With minimal deposits available, the owners were concerned about their ability to acquire new machinery that would enable them to capitalise on their growth without significantly increasing financial strain. Ultimately, they required a flexible construction equipment finance solution that would allow them to scale quickly and minimise costs, while also delivering results for their clients.

Our Solution

To address these challenges, we provided a financing solution that involved structuring the construction equipment finance over 60 months with variable interest rates. This arrangement included the option for early settlement, allowing the client flexibility if they chose to change equipment in the future while keeping monthly payments manageable. Additionally, we deferred VAT payments, further improving cash flow for the business. The client responded enthusiastically to the proposed solution, appreciating the tailored approach that aligned with their growth objectives. Over the course of four years, the company expanded its workforce from just 3 people to over 50. We maintained open lines of communication, ensuring that financing options were readily available, should they require quick changes to their equipment as their needs evolved.

The Result

The financing solutions led to transformative results for the construction business, propelling their turnover to nearly £10 million. By owning their equipment rather than renting, they significantly reduced overhead costs, minimising the hire expenses that had previously eroded profit margins. This ownership allowed for greater operational flexibility, enabling them to take on larger contracts and respond swiftly to client demands, which enhanced customer satisfaction and fostered repeat business.

With improved financial stability, the business could invest in workforce training and operational enhancements, further boosting productivity. The deferred VAT and adaptable construction equipment finance terms empowered the owners to manage cash flow effectively, reducing financial pressure during peak project seasons. Overall, these outcomes not only solidified the company's market position but also fostered a culture focused on delivering exceptional service, facilitating a cycle of growth and opportunity that positioned them as key players in the construction industry.