Contractor Registration

Construction Contractors who are able to fulfill the above criteria, are eligible to apply for facilities such as Bid Bonds, Performance Bonds, Advance Payment Guarantees, Maintanence Bonds, Retention Bonds and Combined Bonds.

Provide Bonds/ Guarantees

Evaluate

Once an application for a particular type of Bond /Guarantee is made to CGF, CGF will then carry out a process of evaluating and reviewing the Contractor, the Employer and the Contract Conditions, in order to determine their credibility, validity and effectiveness, prior to granting the required facility.

Evaluation procedure for Contractors

The contractor evaluation procedure is a systematic process used by organizations to assess and review the performance of contractors or vendors who have been hired to provide goods or services. This procedure helps ensure that contractors are meeting the agreed-upon standards, delivering quality work, and adhering to contractual obligations.

Evaluation procedure for Employer/ Client

The Employer/ Client evaluation procedure involves assessing the performance and effectiveness of the organization who are responsible for managing contracts with external parties, such as vendors, suppliers, and service providers. The purpose of this procedure is to ensure that contract owners are effectively fulfilling their responsibilities and contributing to the successful execution of contracts.

Evaluation procedure for Project/ Contract

The construction project/contract evaluation procedure involves a systematic process for assessing the performance, progress, quality, and outcomes of construction project/contract. This procedure is critical to ensuring that construction projects/contracts are executed effectively, meet the established standards, and achieve their intended goals.

Bridging Finance & Factoring

The context of finance is one of the major factors affecting the smooth implementation of a project. Finance plays a vital role in the success of businesses. It provides companies with the necessary funds to start, operate and expand their operations. Without adequate finance, businesses cannot pay for essential resources such as employees, supplies or equipment needed to maintain their daily operations.

In most projects carried out in Sri Lanka, payment delays by Employers to Contractors leads to delay of contractors’ performance and cause time performance problem. This may also lead to disputes between owner and contractor. All of which will affect the overall performance of project execution.

The Contractors in general always depend on the revolving capital, either from Banks or by obtaining funds by any other means. Therefore, when the Employer delays payments to the Contractor, the Contractor in-turn does not have any other option, other than to abandon or curtail the project.

CGF understanding the situation, introduced the concepts of Bridging Finance and Factoring. Here once the bills are certified by the Employer, CGF intercedes either in the form of providing Bridging Finance or Factoring, in order to enable the Contractor to continue with the work. CGF usually does not charge and this will be a part of the free service given to the Contractor when implementing projects.

There are instances that when the Contractor has proved good project performance throughout, then CGF will assist the Contractor in revolving capital, project financing and funds for equipment. These are treated as part of the free service by CGF to contractor’s with good standing.

Bridging Finance

Bridge financing, often in the form of a bridge loan, is an interim financing option used by companies and other entities to solidify their short-term position until a long-term financing option can be arranged. Bridge financing normally comes from a bank or venture capital firm in the form of a loan or equity investment.

Bridge financing "bridges" the gap between the time when a company's money is set to run out and when it can expect to receive an infusion of funds later on. This type of financing is most normally used to fulfill a company's short-term working capital needs.

Factoring

Factoring on the other hand is when an intermediary agent provides cash or financing to companies by purchasing their accounts receivables. A factor is essentially a funding source that agrees to pay the company the value of an invoice, less a discount for commission and fees. Factoring can help companies improve their short-term cash needs, by selling their receivables in return for an injection of cash from the factoring company.

Contract Monitoring

CGF strives to provide facilities to Contractors without obtaining collateral from them. In order to safeguard the interests of the CGF and so to minimize the risk, one of the methods adapted by CGF is to closely supervise and monitor the project during its lifetime. Accordingly, a model has been developed by CGF to monitor the project performance via its district wide monitoring officers, while maintaining and monitoring the financial discipline of the Contractor in respect of the particular project, via funneling the project related funds via the CGF nominated Bank accounts and disbursing the funds according to project performance.

Dispute Resolution

Construction projects are usually long term operations with high uncertainty and complexity, and it is impossible to resolve every detail and foresee every contingency at the outset. As a result, situations often arise that result in disputes between the parties to the contract.

Where disputes occur, the parties to the contract should first attempt to resolve them amongst themselves, as this is likely to be the fastest and least expensive solution, allowing the project to continue without disruption and maintaining good working relationships.

Where this is not possible, it may be necessary to seek a third party to resolve the dispute.

However, taking disputes to the courts can be expensive, complex, adversarial and time consuming. This may not be appropriate on construction projects, where a quick resolution may be needed so that the works can proceed and where it is important that the parties to the contract maintain a good working relationship.

As a result, construction contracts usually include provisions for the resolution of disputes by agreed alternative dispute resolution procedures (ADR). These are typically less formal than court proceedings and should be faster, less expensive and less time consuming, allowing the parties to maintain a good relationship.

ADR typically involves procedures such as mediation, adjudication, arbitration, or a combination. Large or complex projects may have additional tiered dispute resolution procedures (with obligations to negotiate in good faith), dispute resolution boards, steering committees and partnering meetings.

Knowledge- Sharing

Construction is a knowledge-intensive process, relying on a wide range of knowledge from different sources. Most of the knowledge in the construction industry is tacit (i.e. inside individuals), rather than explicit, and its sharing is imperative for enhanced project performance. Sharing knowledge between the project participants, helps them connect, perform better, and become stronger professionals and in turn improves efficiency. For this reason, project managers need to find ways to encourage collaboration and communication among team members and nurture an atmosphere of knowledge sharing.

In order to foster such a knowledge sharing culture, CGF instigated a programme of sharing knowledge via Technical Clinics. This is a free advisory service conducted by the CGF.

All contractors whether they obtain facilities or not from CGF, could call over to obtain such advice, in some instances on a one-to-one basis, or through pocket meetings, seminars, workshops in head office, regional offices, contractor’s office, employer’s office or at any given forum at the professional level.

CGF exploiting its past experience over the past 23+ years, provides advice to Contractors on the processes involved in the following stages, enabling the Contractors to strive to manage the construction project within the given time frame and planned budget and complete the project successfully, while adhering to proper contract management practices as mentioned below.

Pre-bid;

Post Contract;