Moving from Scaffolding Hire to Lease
Learn how a company in South Wales grew their business by moving from hire to lease-to-own
With a monthly hire bill of over £5,000, an established South Wales scaffolding company were accustomed to the monthly drain of a large scaffolding hire bill. Although it was expected for the size of their business, these monthly bills were causing a considerable dent in cash flow every month.
After realising they needed to change their business model for the better, they considered all financial avenues, but felt their options were limited. It is well documented that it can be difficult to receive funding within the construction industry. Banks are reluctant to lend; and it is imperative to keep existing credit lines available. (Have you read our blog Arranging Finance for a new Scaffolding Company for more information regarding these types of issues?)
WestWon have facilitated over £100k worth of finance for new start scaffolding companies!
Upon speaking with WestWon, they realised they could reduce their monthly costs considerably. The key deciding factor was knowing they would own the kit outright at the end of their lease. Thus, making much larger profits on future contracts once the lease is paid off. Additionally, nearly halving their monthly payment from £5,000 to £2,684 has freed up cash within the business. Every company could use such a freeing up of resources.
This scaffolding business concluded they wanted to transfer the entirety of their hire bill over to sale. This was made possible by using WestWon’s scaffolding leasing option. The additional, immediate benefit of the change was to reduce their hire bill considerably. However, at the same time, they would increase the investment in materials in their yard that the business owned outright. This also means they are improving and investing in their stock with brand new equipment and materials.