HELPING ‘HONEST’ BUILDERS WIN
Stop being Undercut by ‘Distressed’ Competitors
Start New Projects Cashflow Positive
Frequent, high-profile insolvencies continue to prove that the construction industry’s commercial payment model is broken. Unfortunately, it’s also made many developers & lenders nervous.
Insolvency concerns mean that all builders (including the honest ones) continue to be subject to the same risk-mitigating payment terms, impacting builder cashflow & liquidity.
IPEX helps builders to ‘prove’ their financial position & remove insolvency concerns for developers & lenders. IPEX strongly deters distressed builders from tendering, increasing the chance that contracts go to ‘honest’ builders under fairer commercial terms.
DIFFERENTIATE YOUR BID
Agreeing to work under IPEX ‘proves’ what standard due diligence can’t: that you have the financial capacity to complete existing projects without diverting funds from this project.
FAIRER COMMERCIAL TERMS
From modified security requirements to cash in advance for site establishment & certain material deposits, builders are starting IPEX projects in a cashflow positive position.
IPEX Helps Developers Find The ‘Honest’ Builders
IPEX is an online payment platform that ensures progress payments can be used only to pay approved subcontractors & suppliers linked to that specific project. IPEX also provides developers with visibility over who has been paid & when, without sharing a builders’ commercially sensitive information*. IPEX acceptance is fast becoming a primary driver of builder selection for many developers & lenders.
Differentiate your bid by ‘proving’ your financial position
Remove distressed builders from any tender
Start projects in a cash-positive position
Supplier deposits may be funded by the developer
No need to reveal margins or payment values
No change to builder processes & no impact on builder payment
Attract best trades by reducing non-payment risk
Builders That Can Ease Insolvency Concerns
Have a Huge Advantage in Any Tender
STOP LOSING CONTRACTS TO ‘LOW-BALL’ BIDS FROM DISTRESSED BUILDERS
Most builders have endured a run of loss-making projects in recent times; combine this with a lack of new commencements & some are desperate for a new contract.
‘Good’ builders are increasingly losing contracts to builders that are in survival mode: how do you compete with a builder who has no intention of making a profit & is willing to accept risks that no rational builder would or should just to keep the lights on?
Not only does IPEX serve to help ‘good’ builders to stand out, it effectively removes dishonest competition; distressed builders will always fight the use of IPEX – this response helps to identify them & rule them out.
NEGOTIATE BETTER COMMERCIAL TERMS & START NEW PROJECTS IN A CASH POSITIVE POSITION
Market conditions continue to place significant strain on builder finances, leading to calls for changes to the way builders are paid. In reality, insolvency concerns will only ever worsen builder liquidity, with all parties holding funds back to protect their own position.
IPEX changes this. Once a developer/lender can be sure that progress payments will reach the subcontractors & suppliers linked to each claim, other builder payment models become possible.
Under IPEX, developers are regularly agreeing to an initial upfront payment to their builder of between 1% & 2.5% of head contract value* for site establishment costs and/or funding certain long lead time material deposits. These payments are allowing builders to lock in material costs early & start the project in a cash positive position.
*Not an IPEX system feature. All contract terms/payment conditions are to be agreed between the developer & builder on a project-by-project basis.
“We offer IPEX because it allows us to prove our balance sheet is strong & differentiate us from those who might be ‘misrepresenting’ their current financial position. All any builder really wants is to get paid what they’re entitled to, and IPEX doesn’t affect our payment. Yes, it puts subcontractor entitlements off limits but that has no practical impact on us as we’ve never relied on that money – we always pay our subcontractors on time.
It’s also tough to attract subbies in this market so removing their risk of non-payment doesn’t hurt either. Unless a builder is already in a fair bit of trouble, I can’t see why a request to work under IPEX would be an issue.”
'IPEX' DEVELOPERS
'IPEX READY' BUILDERS
What Can the Developer See Under IPEX?
Most projects are run under the IPEX ‘standard’ view, which shows only who has been paid & when – no subcontract/payment values or margins are revealed.
No payment impact: everyone (including the builder) gets what they’re entitled to.
No change to builder process: Subcontractor / builder claim processes & QS assessment/ approval process remain as is
- The builder controls the project account & simply uploads the payment file into IPEX instead of normal banking platform
- IPEX automatically cross checks the uploaded payment file against the account details of subcontractors & suppliers linked to the project, before the builder authorises payment
IPEX simply validates the ‘stat dec’ process – for builders that are already paying subcontractors & suppliers on time, nothing changes.
What Our Customers Have to Say
“We offer IPEX because it allows us to prove our balance sheet is strong & differentiate us from those who might be ‘misrepresenting’ their current financial position.” All any builder really wants is to get paid what they’re entitled to, and IPEX doesn’t affect our payment. Yes, it puts subcontractor entitlements off limits but that has no practical impact on us as we’ve never relied on that money - we always pay our subcontractors on time. It’s also tough to attract subbies in this market so removing their risk of non-payment doesn’t hurt either. Unless a builder is already in a fair bit of trouble, I can’t see why a request to work under IPEX would be an issue.”
"At Frasers, we take our commitment to every project, and every investor, builder, subcontractor, supplier, and customer we work with seriously. That means putting in place financial frameworks and processes to ensure that every dollar is used for its intended purpose, and there is full accountability and transparency over the budget for a project.” “We’re so excited about the Encompass development, which has a real ‘wow’ factor, and through IPEX we’re better positioned to deliver the project securely and successfully.”
"From the moment I understood what IPEX provided I had no hesitation in introducing it to BlueScope. With such a major capital works project it was clearly a very prudent risk management tool. With hundreds of millions of dollars being paid to suppliers and subcontractors through major contractors, securing certainty that monies were being delivered into the accounts of the substantial number of subcontractors and suppliers was critical.“
"After a year of utilising the IPEX platform on one of our key commercial construction projects, the experience has been overwhelmingly positive. The platform’s user interface and our customer service experience have exceeded our expectations, significantly bolstering the security and efficiency of our collaboration with the builder. The adoption of IPEX has been embraced by the builder and & it provides additional comfort to trades particularly with the current construction industry challenges."
“IPEX delivers the security of funds subcontractors need on projects. Everyone prices risk into jobs; however, with the IPEX concept, there is a reduction of payment risk, which should translate into a more competitively priced trade insurance outcome. It’s really in everyone’s best interests in the long run to use IPEX.”
“Once we were aware of IPEX and decided to implement this new standard for project payments, it was a seamless onboarding and end-user experience. It reduces risk and addresses trust and relationship building in one platform. This will put us in a powerful position as the demand for construction labour increases.”
BOOK AN IPEX DEMO
IPEX is an online payment platform that secures funds intended for a project, protecting developers, subcontractors & suppliers in the event of builder insolvency. Whilst IPEX protects developer & subcontractor payments, it also helps financially secure builders to validate their money management practices, differentiating their bid from competitors in the process.
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