7 min read read
Groundscare businesses that grow tend to grow in steps — a new contract requires a step change in fleet, not a gradual one. That timing mismatch between mobilising equipment and being paid under the new contract is the most common reason growth stalls even when the work itself is profitable.
The situation
A multi-year grounds maintenance contract, whether for a local authority, housing association or sports venue, usually specifies the standard of machinery expected and a mobilisation date. That might mean two or three new ride-on mowers, a compact tractor with attachments, a tipper or pickup, and smaller kit like blowers and strimmers — often £80,000-£180,000 of equipment needed before the contract has generated a penny of income.
Payment terms on public sector and managing-agent contracts are frequently 30-60 days, and retentions or performance bonds can tie up further cash. Meanwhile the business still has its existing contracts and payroll to fund.
What tends to go wrong
- Underquoting the true equipment spend because existing kit is assumed to be sufficient, then discovering mid-contract it isn't
- Using an overdraft or credit card to bridge equipment cost, which is expensive and doesn't match the multi-year nature of the contract
- Financing to the contract's minimum term rather than the equipment's useful life, leaving a residual liability once the contract ends
- Not accounting for VAT and delivery/commissioning costs on top of the headline equipment price
How we would structure it
For mowers and utility vehicles that will keep working after this particular contract ends, hire purchase spread over the useful life of the kit — rather than squeezed into the contract term — keeps monthly payments manageable and leaves the business with an owned asset it can redeploy. Where a contract is genuinely fixed-term and the equipment is specified to a standard the business wouldn't otherwise choose, an operating lease can limit exposure once the contract concludes.
| Asset | Typical structure | Term |
|---|---|---|
| Ride-on mowers | Hire purchase | 4-5 years |
| Compact tractor & attachments | Hire purchase | 5-6 years |
| Tipper / pickup | Hire purchase or lease | 3-5 years |
Worked example
Illustrative contract mobilisation
- Contract value
- £420,000 over 3 years
- Equipment required
- £135,000
- Structure
- Hire purchase, 5 years, deposit £13,500
- Monthly payment (illustrative)
- £2,350
- First invoice under contract due
- Month 2
Figures are illustrative only and depend on rate, deposit and underwriting at the time.
What to have ready
- A copy of the contract or letter of intent, including payment terms and mobilisation date
- A list of equipment required with dealer quotes
- Latest accounts and, if the business is newer, a short cash-flow forecast for the contract's first year
- Details of any retention or performance bond requirements
Send us the contract details and equipment list as soon as you have them — mobilisation dates are usually fixed, and lead time on new machinery can be the tighter constraint.
Next step
Talk through the numbers with us
Send us the details of the asset and we will come back with an indicative figure and a properly structured option from the funder panel. No obligation, and no pressure to proceed.