Even against economic headwinds, the construction sector has remained poised for continued growth for the foreseeable future, according to Engineering News Record’s Q1 ‘23 Construction Industry Confidence Index. Yet, there are still significant challenges for construction companies, including managing cash flow and handling the lien waiver process that can slow down progress on construction projects. While these are decades-old challenges for the construction industry, a new solution, MX Build, introduced by Priority, a company led by CEO Thomas Priore, is helping construction companies with resolutions.
“Amid being poised for growth, construction companies today face a number of cash flow problems such as slow-paying customers, high payroll burdens, slow invoicing, and the need to purchase costly assets and materials upfront. Construction companies now have the technology and resources to help solve old business challenges that impact their projects, stifle their cash flow, and impede their ability to accept payments. MX Build is a part of our unified commerce solution that eliminates the frustrations and challenges facing construction businesses,” said Thomas Priore, Chairman and CEO of Priority.
The Challenges of Lien Waiver and Cash Flow Management in Construction
Good cash flow management processes are critical to the resource-strapped and labor-intensive construction industry. Being able to forecast inflows and outflows, along with being capable of receiving and dispensing funds, is the best way to ensure construction projects stay on track. “Traditional payment methods for construction companies can slow the flow of cash coming back into the business, so there is a need for more efficient and streamlined payment solutions,” states Thomas Priore.
Embedded payments are the ability to move money and pay for goods and services in one place, like the digital wallets common in the consumer world. In the construction space, embedded payments can simplify expense management, accelerate cash flow, streamline compliance, and help to minimize risky payments. “By combining payments, banking, and construction management into MX Build, our construction company customers can maximize operational efficiency and better manage the flow of funds with payment processing integration into their business systems, as well as benefit from improved and streamlined compliance processes,” said Priore.
Lien waiver management is equally a high priority. Lien waivers are valuable tools to increase accountability and offer legal protection from outstanding payments and balances within the construction industry. Lien waivers are both proof of payment and a legal agreement that the provider of goods or services gives up the right to place a lien on the payer’s property or goods if the contracted agreements are met. In construction, a single project can require up to 50 waivers and multiple contractors and suppliers, requiring project administrators to remind contractors about them constantly to keep projects on track.
While the construction industry uses lien waivers to keep projects flowing, they are often known for their tedious and complex processes. Through its embedded finance innovations, “Priority has not only empowered construction companies with better management tools, but we’ve developed a lien waiver automation process that helps to take this burden off of teams,” said Thomas Priore.
How MX Build Improves Operational Efficiencies
We’ve established that lien waiver management is one of the biggest challenges in construction, but it no longer has to be this way. Priore states, “MX Build automates and improves the finance and business processes. By streamlining these functions with embedded payments, construction companies can have what they desire and deserve, a much clearer picture of their financial health and operational needs, enhanced reporting transparency, and improved cash flow visibility. Automating processes also reduces manual errors and risks for construction firms, so the benefits are very positive.”
The old construction processes simply don’t work anymore, especially when new solutions like MX Build are available in the market. Construction companies that learn how to apply industry advancements and transform their business with new processes and solutions will stand to gain the most in seasons of growth and even in times of economic downturn.
To learn more about MX Build and Priority’s approach to embedded finance, visit: https://prioritycommerce.com/smb-payments/mx-build/