When you are required to allow your debtors often at least 60 day payment terms (and then they take 90), cash flow can be tricky. Especially if you are in the construction sector.
And when cash flow stops, well, flowing, often your operations can grind to a halt too – meaning that your next set of payments won’t come in either.
Let’s see if you can relate to Dave…
What were those solutions again?
- Pay your workers
- Keep your current and upcoming projects moving
- Free up headspace to focus on the job at hand!
What finance options are available for construction projects in need of support?
If cash flow is threatening to put a stop to your construction project then rest assured that there are a suite of options available for construction companies and their directors who need to access cash to keep them moving.
They could consider:
A normal business loan
But, one of the most effective ways for construction companies to get access to funds quickly thus keeping projects moving, is advancing payments on invoices and applications for payment.
Did you know that you can advance cash owed on your uncertified applications for payment?
85% of construction companies could benefit from this!
That’s correct. Even if your application for payment is uncertified, some lenders will advance the payment to you before the debtor can make their payment.
Repayments on this type of construction finance can be more flexible than a traditional loan too, hence they are becoming preferable where possible for a construction company in need.
How to get finance for a construction project in need
To get funding for a project which has stalled (or to finance a project) you need ensure that you go to the right lender first time. At the last count there were over 70 finance companies who lend money on your invoices. But in the construction sector I would say about 10, but they all have their own sweet spot.
You need the inside track to choose the right one for your current and future circumstances
Therefore it is advisable that if you need cash quickly, you use a specialist construction finance broker with relationships with lenders who can help you.
Need more help?
If you are in the construction sector and you require financial support immediately, please take the time to read this next article on Construction Finance specifically. The information within and contact details provided should take you on the path to getting the cash injection you need to get your project moving again.