Offer finance for a building business

Offer Finance for a Building Business

Building businesses, whether large or small, play a vital role in the UK economy. They are responsible for constructing homes, offices, schools, and infrastructure that are essential to modern life. However, running a building business comes with its own set of challenges, and one of the most significant is managing finances. Offering finance solutions to customers can be a game-changer for many construction companies, helping to attract more clients and improve cash flow. In this article, we will explore the importance of offering finance in the building industry, how it benefits both the business and its customers, and how Kandoo, a UK retail finance broker, can assist in providing these solutions.

The Importance of Finance in the Building Industry

The construction industry is highly competitive, and one of the biggest barriers for potential clients is the cost. Whether it’s a small renovation project or a new build, construction work can be expensive. Many customers may delay or abandon their projects due to budget constraints. This is where offering finance can make a significant difference.

By providing finance options, building businesses can make their services more accessible to a broader range of customers. Instead of requiring clients to pay a lump sum upfront, businesses can offer the option to spread the cost over a set period, making projects more affordable and manageable. This can lead to an increase in sales, improved customer satisfaction, and more stable cash flow for the business.

Benefits of Offering Finance to Customers

Offering finance options is not just about making projects affordable for customers; it has numerous benefits for building businesses as well. Below are some key advantages:

1. Attracting More Clients

Many potential clients are put off by the upfront cost of construction projects. By offering finance options, businesses can appeal to customers who may otherwise be unable to afford their services. Providing flexible payment plans can be the deciding factor that leads to securing a contract.

2. Increased Project Size

When customers have the option to spread payments, they may be more willing to take on larger or more ambitious projects. For instance, a homeowner may opt for a complete home renovation rather than just a kitchen extension if they can finance the work. This can result in higher revenue for the building business.

3. Improved Cash Flow

Many building businesses face cash flow challenges due to the irregular nature of payments. Customers may delay payments, or projects may be stalled due to financial constraints. Offering finance options ensures that the business receives regular payments, which can improve cash flow and make it easier to manage expenses and payroll.

4. Competitive Advantage

Offering finance can set a building business apart from competitors who do not provide this option. In a competitive industry, having an additional service like finance can give businesses an edge and increase the likelihood of winning contracts.

5. Building Long-Term Relationships

When a business helps a customer finance their project, it creates a sense of trust and partnership. Customers are more likely to return for future projects or recommend the business to others. Offering finance can lead to long-term relationships and repeat business, which is essential for growth.

Types of Finance Options for Building Businesses

There are several different types of finance options that building businesses can offer to their customers. Each has its own advantages, depending on the needs of the customer and the business.

1. Personal Loans

One of the most straightforward options is a personal loan. Customers can apply for a loan to cover the cost of the building project and repay it in instalments over a set period. This option is typically offered through a finance broker, like Kandoo, which connects customers with lenders who can provide the necessary funding.

2. Hire Purchase

Hire purchase agreements allow customers to pay for their project in instalments while using the completed building or renovation. Ownership of the building is transferred to the customer once the final payment is made. This option can be appealing for customers who want to spread payments but still have access to the completed project during the repayment period.

3. Interest-Free Credit

Some building businesses may offer interest-free credit for a set period, typically 6 to 12 months. This allows customers to spread the cost of their project without incurring any interest charges, making it a very attractive option. However, businesses need to carefully consider whether they can afford to offer this type of financing.

4. Buy Now, Pay Later

Buy now, pay later (BNPL) schemes allow customers to delay payment for a set period, usually 6 to 12 months, before they start making instalments. This option gives customers time to save up for the project or secure additional funding before they begin making payments.

5. Secured Loans

Secured loans involve customers using their property or another asset as collateral to secure the loan. This option is often used for larger projects where significant sums of money are required. While this can be a good option for customers who need a larger loan, it also comes with higher risks, as failure to repay the loan could result in the loss of the collateral.

How Kandoo Can Help

Kandoo is a UK-based retail finance broker that specialises in connecting businesses and customers with appropriate finance solutions. By partnering with Kandoo, building businesses can offer a range of finance options to their customers, helping to make projects more affordable and accessible.

1. Access to a Wide Range of Lenders

Kandoo works with a panel of reputable lenders, offering a wide range of finance products. This means that customers are more likely to find a finance solution that suits their needs, whether they require a personal loan, secured loan, or interest-free credit. Kandoo's extensive network ensures that customers have access to competitive rates and terms.

2. Simple Application Process

One of the key advantages of working with Kandoo is the simplicity of the application process. Customers can apply for finance online through Kandoo’s platform, and the system matches them with the most suitable lender. This streamlined process saves time and effort for both the customer and the building business.

3. Customer Support

Kandoo provides dedicated customer support throughout the finance application process. This ensures that customers fully understand the terms of their finance agreement and have access to assistance if they encounter any issues. This level of support can enhance the customer experience and build trust in the building business.

4. Compliance and Regulation

As a regulated finance broker, Kandoo ensures that all finance products offered comply with UK financial regulations. This provides peace of mind for both the business and its customers, knowing that they are dealing with a reputable and compliant organisation.

How to Implement Finance Options in Your Building Business

If you’re considering offering finance options in your building business, here are some steps to help you get started:

1. Partner with a Finance Broker

The first step is to partner with a finance broker like Kandoo. A broker will handle the finance process, including connecting customers with lenders and managing applications. This allows you to focus on your core business while offering finance options to your customers.

2. Train Your Team

Your team should be familiar with the finance options available and how to present them to customers. Training your staff to explain the benefits of financing and how it works can help ensure a smooth process and increase the likelihood of customers taking advantage of the options.

3. Promote Your Finance Options

Make sure your customers are aware that you offer finance options. Include information about finance on your website, in your marketing materials, and during consultations with potential clients. The more visible and accessible your finance options are, the more likely customers are to consider them.

4. Review and Update Regularly

The finance landscape can change, and it’s essential to regularly review the options you offer to ensure they remain competitive and relevant to your customers. Partnering with a broker like Kandoo means you’ll have access to the latest finance products and can adjust your offerings as needed.

Conclusion

Offering finance for a building business can provide significant benefits, from attracting more customers to improving cash flow and increasing project sizes. With the help of a trusted finance broker like Kandoo, businesses can offer a range of flexible payment options that make construction projects more accessible to clients. By implementing finance solutions, building businesses can gain a competitive edge, build long-term customer relationships, and ultimately grow their operations.