By Matthew Jones, CEO of Open ECX…
The Specialist Engineering Contractors’ (SEC) Group is calling on the Government to solve the UK construction industry’s long-standing and crippling payments problem, labelling the current cashflow position as “critical”.
In a recent article, the SEC Group – which represents SMEs in the construction engineering sector – warns that its members are increasingly being propped up by their directors’ wallets as an interim cashflow ‘solution’.
They cite Funding Options figures that show directors lent their construction businesses £38 million in 2015/2016, up from £29.7 million in 2013/2014 – a jump of 28 per cent in just two years. Unsurprisingly, the SEC Group labels this rise as “unsustainable” and has urged the Government to introduce legislation to solve the problem.
We agree wholeheartedly with the SEC Group – the cashflow issue has affected growth of construction businesses of all shapes and sizes for too long and needs to be addressed urgently. However, we feel that while the Government has a role to play in improving B2B payments in the industry, businesses themselves can do much more to take greater control of their finances.
We’ve partnered with Invapay, an Optal company, to make this easily achievable. Our unique proposition – a combined full-service payment solution – provides construction businesses with a quick and effortless way to manage their payment process and maximise working capital benefits. With Open ECX and Invapay, businesses are able to make their payment processes simple, streamlined and effortless from the moment a payment application is made right through to the point that it is paid.
Our cloud-based paper-free WebContractor solution manages the first half of the process, giving subcontractors and suppliers the ability to submit invoices quickly and easily through an online portal. The automated service then processes the application, sending verification notices emails to the applicant and the QS, allowing invoicing authorisation to be granted hassle-free.
At this stage Invapay’s payment solution comes into play. With no changes to processes and systems, Invapay’s business-tobusiness payment platform allows businesses to optimise their payments to suppliers and subcontractors. Through Invapay, businesses can take greater control of their cash flow – across working capital, credit lines and third party funds – ensuring long term cash flow benefits for buyers and subcontractors.