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„ ÉPDUFERR Zrt. is a construction company, however, in the fields of qualification it is able to harmonize its activities with banks, which is profitable for all parties.”
Construction life, February 2012.
Press release
Construction life, February 2012.
How construction companies can develop today in a crisis period?
How to secure payments by the deadline?
Since 2004 the Dunaújváros based ÉPDUFERR Zrt. founded by Hungarian owners is an active player within the field of construction. At the beginning the company has been involved in the production of steel structures and its on the spot assembly.
The scope of its services has been constantly growing in line with the needs of our clientele, then during the years it became a general contractor enterprise. It has been able to increase its profits every year in a way that its revenues had been doubled almost every year since 2008.
Szabolcs Tóth Managing Director told us about the keys to success.
There are three key factors to the operation of the company. The first one is the continuous development of the activities; the second is keeping the clients and the enlargement of their group. The third pillar most companies tend to forget about is the connection with its suppliers and the network of their subcontractors.
“From the beginning we placed great emphasis on mapping our market environment. We have to be able to screen the offers coming in and to select the ones which are advantageous for our company as well” said the Managing Director.
“We have a service where we co-operate with a bank and a factoring company (Editor: a company dealing with the purchase and the sale of receivables.). It is a unique qualification system which we apply in order to assess the risk of the business opportunities” added Mr. Tóth.
It is an interesting mix: ÉPDUFERR Zrt. is a construction company, but in the qualification field they are able to harmonize their activities with the banks, and it is profitable for all the parties.
Due to the fact that ÉPDUFERR Zrt. qualifies all its suppliers, the banks are ready to finance the company’s projects under favorable terms.
„The construction market diminished significantly; and the circle of debts raise difficulties for the players, especially for small companies. Although the phenomenon is called gridlock, I believe that in fact it is rather a chain of debts, and most of the times small and medium companies face it. Small companies suffer additional pain due to financing the wages and the cost of raw materials in advance, while a lot of clients fail to meet even the extremely long payment deadlines reaching 60-90 days. Our company keeps searching for favourable payment conditions, thus securing payments made by the deadline.”
In addition to the existing capital reserves of ÉPDUFERR Kft the collateral for its operation is provided by the whole system built around the company: clients with liquidity, the financing bank and the insurance company. “Due to the preliminary qualification there is no such payment risk that we should pass on to our partners. Therefore regardless the settlement with the investor we can pay our subcontractors and suppliers. With this approach we have been able to increase the stability of the companies.”
The work processes are under continuous rationalization; each task allows us to conclude what can be done in a more profitable way, or how can we create the same or an even better product and to lower the inputs. This allows taking advantage of the opportunities within the company.
“We still believe in the sustainable growth of the company; however we do not cherish an illusion. Although we can not see a sudden market boom, we remain optimistic.”
In 2011 they opened an office in Budapest, this year they plan to open offices in Kecskemét and in Sopron.
The company will be transformed into a limited company soon.
The company plans to launch affiliate companies before 2013 to serve the international market, in Romania and Poland, among others.
When talking to Szabolcs Tóth there were two more thoughts that raised my attention, I believe that these are the indispensable basis for a successful company.
“Everything should be done in advance, not in hindsite. In order to reach success one needs time, patience and faith.”
Alföldi Régió Magazin, issue Iv./1