Better payment terms with PayExpress
Clients want to extend their payment terms, while consultants want to get paid faster. The PayExpress financing service satisfies the interests of both parties while strengthening Ework Group’s core business.
Ulf Ohlfeldt, newly recruited Head of PayExpress, started his position in spring 2021. His assignment is clear – to strengthen the business and further develop the offering with associated financial services.
“For us, this is a way of increasing the added value that Ework Group offers both clients and consultants,” says Ulf Ohlfeldt.
The investment in PayExpress meets a growing demand in a market where payment times are getting longer, at large companies as well as medium-sized.
“The major buyers of our services are often listed companies or private equity-owned companies that strive to optimise their working capital, one way to free up capital is to extend payment times,” says Ulf Ohlfeldt.
On the other side are the consultants, who can be hard hit when the terms of payment are deferred from 30 to 60, and sometimes even up to 180 days. This can create liquidity problems when wages, taxes and other ongoing expenses still have to be paid on a regular basis. The challenge is not new but several reports higlight that the problem of long payment times is growing. In 2019, the Swedish Companies Registration Office (Bolagsverket) and the Swedish Agency for Economic and Regional Growth (Tillväxtverket) confirmed in a joint report that the problem of getting paid on time is creating pressurised financial situations in many companies. One common criticism is that large companies, by extending payment times, are essentially forcing smaller suppliers to take on the role of a bank. The credit management company Intrum confirms in its latest European Payment Report 2021 that 49% of companies in Sweden have accepted longer payment times than they are comfortable with – as they are unwilling to destroy their customer relations.
“With PayExpress, we can support our consultants and give them a clear financial forecast. We make sure that they get paid and on time, which gives them peace of mind and allows them to focus on their core business,” he says.
Ulf Ohlfeldt joins Ework Group from the role of Head of New Sales at the credit management company Lowell, and he has extensive experience in the financing of special and operating capital from his time at Nordea. More and more companies and financial institutions are offering factoring and various solutions for invoice credits, he confirms. But neither banks nor finance companies have the same flexibility or smooth solution as Ework Group and PayExpress.
“The established relationship we already have with our clients and consultants gives us other opportunities for negotiation. We know that they pay, which means they don’t have the same exposure to credit losses, which also affects the price,” says Ulf Ohlfeldt.
It is also extremely easy to link PayExpress to the payment service all consultants are already using to invoice the assignments they have obtained through Ework Group.
“Our aim isn’t to maximise the profit from our capital services, but to enhance our offering in order to meet a need that no one else is covering and that exists among our clients and consultants. The intention is also to add other services to PayExpress that are important for our clients and consultants.”
Exchange rate risks is one element. Ework’s consultants work in a global environment, where they themselves, like the companies for which they work, often have a geographical domicile beyond Sweden’s borders. Through PayExpress, consultants can find help mitigating their exchange rate risks by, for example, choosing to invoice in their own currency instead of the local one.
“We’re also seeing a need for industry-specific insurance solutions, and are therefore in the process of developing offerings in the area of liability and income insurance policies. PayExpress gives us the opportunity to broaden our offering in many ways where we believe we can add value for our partners. A good, long-term relationship with them is a prerequisite for our entire business,” says Ulf Ohlfeldt.
Corporate PayExpress attractive for both parties
With Corporate PayExpress, Ework Group is also targeting buyers of consulting services. The newly developed financing service is customised together with buyers to meet their need to extend their terms of payment. The result is an integrated payment system with attractive terms of payment for both parties. The buyer gets an extended payment period and the consultant gets paid more quickly – without cumbersome implementation and administration, on attractive terms. In Corporate PayExpress, we free up capital for both buyer and consultant, which creates added value to work together with us at Ework Group,” says Ulf Ohlfeldt, Head of PayExpress.
Clients, consultants & employees
The collaboration with Aurobay is a little bit broader and a little bit tougher than other collaborations. That’s how Erik Degerman at Ework Group sees it.
To grow fast, Aurobay depends on consultants, and needs often arise at short notice. The solution from Ework Group meets all requirements and makes the company ready for the future.