HELP WHEN IT IS NEEDED THE MOST
For any fledgling company, finding the capital to get started is often the first hurdle faced. When that business is in the construction industry where initial outlay required for machinery is high, and competition is rife, it can be a difficult one to overcome.
That is why JCB Finance’s support in the early days of H H Construction (Groundworks Contractors) Ltd’s establishment in 2008, when other lenders were unwilling to support, has proved instrumental in the company’s subsequent success and growth. It is also a key foundation of the trust and mutual respect that continues to this day.
From a single machine to a fleet worth over £10 million, H H Construction has remained loyal to the lender who understood the company’s plan to invest heavily in new equipment and gradually reduce overall finance while increasing the fleet. This has proved to be a highly successful business model as the company has gone from strength to strength over the course of its near 20-year history.
A MODEL THAT WORKS
H H Construction (Groundworks Contractors) Ltd is a family-run groundworks and civil engineering business based in Castleford, West Yorkshire. The majority of its work is made up of commercial civils projects for industrial units, supermarkets, schools and care homes.
While the company specialises in traditional groundworks, it has expanded into broader building projects including drainage, concreting, paving, highways, excavations and full site preparation. Its latest investment in a fleet of JCB X Series 145XR and 245XR excavators will be put to work on high volume muck shifting.
As the business continues to grow and develop into new areas, it is imperative to continue to invest in the latest up-to-date machinery to meet modern demands on site.
With the HP Plus facility from JCB Finance, H H Construction’s Managing Director John Handforth has created a mechanism which allows him to continually invest in new machinery, starting out with only a 5% deposit and working up to where he is now on his 20th generation of new JCB machines.
John said: “What we try and do is make sure our machines are well looked after, serviced with genuine JCB parts, keep them cosmetically tidy compared to our competitors to maintain that residual value and look to run them for 3-4 years max. We’re working with our dealer TC Harrison JCB constantly, getting them to run spot checks and valuations on machine values so when we trade them in, we can take out minimal finance on newer excavators. We’re looking to perfect the model which has allowed us to start out with nothing and evolve to where we own about £10 million worth of kit - with only £1million of finance.”
MORE THAN JUST DIGGERS
HP Plus is a fixed rate hire purchase (HP) product designed by JCB Finance to provide UK businesses with a way of spreading the cost of buying plant, equipment and vehicles through regular fixed instalment payments with the flexibility to make ad hoc lump sum payments and reduce the interest charged. Plus, this facility comes with a built-in payment-holiday feature that enables you to take unplanned payment holidays, when for example bad weather impacts work and cashflow, without it affecting your credit rating.
For John Handforth, flexibility is the driving factor for selecting the HP Plus facility with JCB Finance. He said: “We always use the HP Plus facility to finance anything and everything, not just our beloved JCB excavators, but also our pick-up trucks and our Scania tipper fleet. We still regularly go to market and for many, many years JCB Finance has been the most competitive so we’ve always stuck with them
“With HP Plus you have the added bonus that if you want to sell or change the machine, you don’t have any penalty as the interest is calculated daily so we value that flexibility and opportunity to save where we can.”
EFFORTLESS EFFICIENCY
In a difficult economic climate, with costs rising and margins being squeezed ever tighter, it is all about staying competitive to succeed. But it is JCB Finance’s efficient and easy-to-use online portal which really sets it apart from the competition.
John Handforth said: “It’s the efficiency that keeps us coming back. JCB Finance has a large facility in place, with all of our different assets across it. The standard rule of thumb we’ve found is that within 24 hours of starting the process the deal is set up. Go onto the portal, sign in, agree your deal, it’s paid out and you’ve got your equipment secured.
“The fundamental factor is you’re not going in for a meeting with your bank manager to review funding, then going to get the machine – you just deal with Amy Baxter at JCB Finance. Our dealer sends over the info, we contact Amy to confirm what deposit we want, 15 minutes later we’ve got a quote and 20 minutes later confirmation is on your laptop. It’s so easy.”
DOING THINGS DIFFERENTLY
With over 50 years’ experience in providing asset finance for customers in the construction, agricultural and industrial sectors JCB Finance can offer fast, flexible finance solutions that help preserve working capital while spreading payments in a cost-effective and tax-efficient manner.
Finance options are not restricted to JCB equipment and are also available for other new non-competitive and used machinery, cars, 4x4s, commercial vehicles, tractors, harvesters, cultivation equipment, balers, trailers, static plant, access equipment and more.
The success of JCB Finance has been built on longstanding relationships, a deep understanding of its customers’ businesses and a commitment to meeting their needs. This is echoed in the partnership between H H Construction (Groundworks Contractors) Ltd and JCB Finance Relationship Manager, Amy Baxter.
John Handforth concludes:
“Amy and I have been working together for over 8 years. We have a great relationship. She understands that it’s not just about crunching numbers but building relationships and we get on really well. Along with JCB Finance and TC Harrison JCB, Amy’s been here for a big part of HH’s journey.
“We set a model about 15 years ago of how we intended to do things slightly differently to other groundworks contractors, about investing money, reducing overall finance while increasing the fleet and we’ve done it by working together. The proof is in the pudding, in the last 10-12 years or so we’ve nailed it as a team.”
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