Finance & Lending

 

07 18 2016

Small Business Loans for Specific Industries

07 18 2016

Gear Up For Construction Season With Working Capital Or Equipment Leasing

In many places throughout the country, there’s only two seasons: winter and construction. While it might currently be the busy time of the year for many construction firms, now is also a great time to start planning ahead for next year’s productive season.

Builder-owners and managers of construction firms can gear up for next year’s construction season by laying the foundation for success today. From outfitting your firm for the future to performing a cost analysis on equipment to obtaining a working capital loan to invest in the business, it’s never too early to plan for next year’s schedule. Creating an early budget forecast helps construction firms establish a metric for business milestones to determine successes and failures. A better grasp of long-term financial projections can help a firm remain on track for growth.

Outfit your construction enterprise for the future

One of the most pressing concerns facing the construction industry is the growing chorus of clients and customers demanding firms incorporate more sustainable and green building processes and structures. For many construction companies, altering their entire operation to accommodate these shifting trends can be difficult and often unfeasible within their current budgets.

As noted in “Shaping the Future of Construction” published by the World Economic Forum, despite the major role construction firms play in shaping the urban landscape and promoting eco-friendly designs, the Engineering & Construction sectors have been slow to incorporate sustainable measures into their operations.

However, unless builder-owners and managers are able to effectively respond to this evolving trend, they might find their construction firm losing bids to more sustainable and eco-friendly companies. If a firm were to allow its competitors to gain a leg up on the sustainable construction front, it can be nearly impossible to make up the difference. This makes it important to have the capabilities now to build the structures of tomorrow.

There are several ways a construction firm can outfit itself for successfully navigating the sustainable industry of tomorrow. Working capital loans provide an immediate injection of money that can be invested back into the construction company to update its processes and make the enterprise more sustainable and eco-friendly. Ideally, the move will resonate with potential clients and customers and lead to more contracts down the road. Similarly, switching from purchasing construction equipment to leasing also frees up overhead that can then be used to re-invest in the business.

Perform a cost analysis on equipment

Are you having trouble with your current menagerie of Bobcat, Caterpillar and Deere construction equipment? Are they not as efficient or productive as they once were? As technological tools age, they often lose their edge and, instead of providing a competitive edge to construction firms, they can be a dead weight holding back the enterprise.

Operating a successful construction firm involves using the best tools available, from the most durable hammer possible to a top-of-the-line excavator. If the equipment isn’t functioning at an optimal level, it’s only going to create problems that manifest as revenue loss and diminished profit margins. To make matters worse, many construction firms don’t have the capital funds to cover purchasing new equipment.

An affordable and convenient way to ensure the firm’s equipment continues to add operational value without breaking the bank is by utilizing equipment leasing. Many construction firms – from international enterprises to the local contractors – take advantage equipment leasing options.

Instead of having to fork over the entire cost of brand new machinery, equipment leasing allows construction firms to make easy monthly payments, which frees up capex and lets the firm better distribute its resources. Further, Section 179 of the IRS code lets small construction firms write off the amount of the lease payments up to $500,000. These are just some of the many benefits associated with leasing equipment instead of outright buying it at full cost.

Prepare for the winter season

Just because business dries up during the winter, it doesn’t mean that construction firms are off the hook for making adequate plans either. In fact, establishing a clear plan of action for maintaining operations through the winter months can be just as – if not more – important than preparing for construction season.

When there are no new contracts, no capital inflows and no prospective clients on the horizon business planning requires innovative and highly cost-effective measures. While some builder-owners or managers might think it wise to cut back on staff members or take other cost-cutting measures to ride out the winter, these moves can come back to haunt the construction firm and make it difficult to scale operations when the spring contracts come rolling in.

During the off-peak season when business slows down, construction firms can take advantage of alternative financing options, such as a working capital loan that can be used to bridge the gap between the feast and famine of the winter and construction seasons.

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Any applications submitted electronically shall have the same force and effect as if the application bore an inked original signature(s). The above information, together with any accompanying financial statements, schedules, or other materials, is submitted for the purpose of obtaining credit and is warranted to be true, correct, and complete.

 

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To help the government fight the funding of terrorism and money laundering activities, Federal law requires all financial institutions to obtain, verify, and record information that identifies each person and business that seeks a business loan. What this means for you: When you apply for a loan, we will ask for your business name, address, and Tax Identification Number. We will also ask for your name, address, date of birth, and other information that will allow us to identify you. We may also ask to see your driver’s license or other identifying documents.

 

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The Merchant and Owner(s)/Officer(s) identified in the application (individually, an “Applicant”) each represents, acknowledges and agrees that (1) all information and documents provided to National Funding, Inc. (“NF”) including credit card processor statements are true, accurate and complete, (2) Applicant will immediately notify NF of any change in such information or financial condition, (3) Applicant authorizes NF to disclose all information and documents that NF may obtain including credit reports to other persons or entities (collectively, “Assignees”) that may be involved with or acquire commercial loans having daily repayment features and/or Merchant Cash Advance transactions, including without limitation the application therefor (collectively, “Transactions”) and each Assignee is authorized to use such information and documents, and share such information and documents with other Assignees, in connection with potential Transactions, (4) each Assignee will rely upon the accuracy and completeness of such information and documents, (5) NF, Assignees, and each of their representatives, successors, assigns and designees (collectively, “Recipients”) are authorized to request and receive any investigative reports, credit reports, statements from creditors or financial institutions, verification of information, or any other information that a Recipient deems necessary, (6) Applicant waives and releases any claims against Recipients and any information-providers arising from any act or omission relating to the requesting, receiving or release of information, and (7) each Owner/Officer represents that he or she is authorized to sign this form on behalf of Merchant.(8) I consent to receive direct mail, faxes, text-messages, and e-mails sent by National Funding and its affiliates for the purposes of transmitting account updates, requests for information and notices, and (9) this request is for business and not for consumer purposes.

 

For Equipment Services:

I hereby certify: (1) the information provided is true and correct, (2) you are hereby authorized to investigate all bank, credit, and trade references, and said references are hereby authorized to release any requested information to you or your nominee, (3) such authorization shall extend to obtaining personal credit profile in considering this application and subsequently for the purposes of update, renewal or extension of such credit or additional credit and for reviewing or collecting the resulting account, (4) this information may be transmitted by us to you and by you to underwriter(s) for the purpose of granting me credit, either electronically or manually, and that by submitting this application, I take full responsibility for transmission thereof, (5) I am over 18 years of age, (6) I acknowledge my rights under the Fair Credit Reporting Act, (7) I consent to receive direct mail, faxes, text-messages, and e-mails sent by National Funding and its affiliates for the purposes of transmitting account updates, requests for information and notices, and (8) this request is for business and not for consumer purposes.

 

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