Running a construction business isn’t just about getting the job done- it can be about being strategic with your cash flow so you can continue to grow, stay competitive and take on bigger opportunities. Bad cash flow isn’t always directly correlated with bad performance; it may just be lack of knowledge.
Too many construction business owners avoid smart financing solutions because of outdated ideas or straight up myths. We want to debunk some of the most common misconceptions around construction finance and what the right approach is to unlock business growth.
Myth 1: ‘If I need to use finance, my business must be struggling.’
Many high-performing construction firms use financing to fuel growth, not to stay afloat. Big projects can mean big investments for materials, labour, plant hire- often long before any money comes in. Smart companies use working capital or invoice finance to bridge the gap between costs and payments. It’s not a sign of a struggling business; it’s strategic cash flow management.
Myth 2: ‘It is better to own all of your equipment outright.’
Owning equipment isn’t always more cost-effective- especially with fast-moving technology and maintenance costs. Asset finance lets you spread the cost of vehicles, machinery and tools over time- sometimes with better tax efficiency. Additionally, if your jobs vary, leasing gives you the flexibility without committing to assets you may not need long-term.
Myth 3: I’ll just wait for the client to pay me.’
Often invoice payment terms of 30, 60 or 90 days are standard- which can cause serious strain on your cash flow. Invoice Finance allows you to receive a pre-agreed percentage of an invoice within 24 hours of raising it, often up to 90% of the invoice. This means you can keep paying staff, buying materials, and taking on new work without waiting for money to clear.
Myth 4: ‘Finance is too complicated and time-consuming’
Traditional banks often don’t understand the construction industry, which can lead to frustrating delays or rejections. A specialist finance broker like Moorgate Finance knows the industry inside out, and can offer fast, flexible options from lenders who also understand construction. We know what to look for, preventing you from wasting time and money.
Myth 5: ‘All finance offers are essentially the same.’
Lenders vary significantly in what they specialise in, approve and offer- especially in construction. We have a strong relationship with our panel of over 80 lenders who can provide tailored solutions and unique terms. A finance broker like Moorgate Finance will take the time to understand your individual needs and can unlock better rates and faster approvals than doing it yourself.
Myth 6: ‘Finance only makes sense for big construction companies.’
Whether you’re a sole trader, a subcontractor or a growing firm, finance can be a smart tool at any stage. Small and mid-sized construction agencies often feel the cash flow squeeze even more than larger firms, especially when juggling upfront material costs, late payments and growing demand. Finance options like equipment leasing, VAT loans and invoice finance can free up working capital and help you to grow and stay competitive.
How Moorgate Finance Can Help
At Moorgate Finance, we understand that running a construction business comes with complex financial demands- from delayed payments and rising material costs to the need for new equipment at moment’s notice. We provide specialist finance solutions tailored for construction companies of all sizes. Whether you need:
- Asset finance to fund plant, machinery or vehicles
- Working capital to keep your projects moving
- Invoice finance to unlock cash tied up in unpaid bills
- Business loans to help you to win bigger contracts
Our experience in the industry and our vast panel of lenders, ensures your individual needs are met and you can focus on growing your business. Get in touch by clicking Apply Now or give us a call on 01908 92 62 62.