All businesses must spend money in order to make money. Some, however, must spend a lot of money just to stay vital, and as luck would have it, these are the same businesses that do not get paid immediately after their work is done. Construction contractors often have to wait up to 120 days to be paid in full. Milestone payments are catalysts for a laundry list of financial dilemmas, and various external factors can extend this waiting period even further.
Bids can take weeks to approve, and then contract details must be ironed out. How are contractors supposed to pay their workers, fix their equipment, or finance their next project when their funds are tied up in receivables? Construction projects are time sensitive, with no room for negotiation. If the contractor cannot come up with the money for the upcoming project in time, the client will simply find someone else who can have it completed by the desired date.
New investors and unexpectedly inclement weather can cause more delays, as if the winter months weren’t painful enough for the contractors. Industry outsiders have probably never thought about how construction companies sustain themselves when their workspaces are covered in snow.
The extended business cycles of construction contractors ultimately prevent them from taking on more work, paying their suppliers on time, and making sound financial decisions. Instead of preparing for projects well ahead of time, the search for workers and equipment begins right after the project is accepted. They don’t have the time or money to weigh out options for equipment or consider maintenance costs.
United Capital Source is the ideal place to get Small Business Loans for Construction & Contractors. We work with commercial plumbing, roofing firms, electrical contractors, masonry contractors, cement suppliers, window fabricators, fence contractors, and landscapers to name a few. Contact us today for your FREE business funding consultation!
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Get WorkingUnited Capital Source has issued numerous types of working capital loans to commercial plumbers, roofers, electrical contractors, masonry contractors, and window fabricators, just to name a few. In some cases, funding can be approved in less than two business days. Contractors can immediately begin gathering resources for an upcoming project, make repairs or pay their bills, even they are cash-poor at the moment.
Standard working capital loans can act as a buffer for slow periods or fill in gaps before receivables come in. They can be accessed before, after, or during projects. Temporary setbacks are virtually inevitable for contractors, but they shouldn’t stop you from accepting work, maintaining a loyal team, or delaying projects. Our working capital loans are particularly advantages for seasonal businesses thanks to our flexible repayment terms. Many UCS clients use bridge financial programs to cover regular business expenses when money isn’t flowing as freely and pay off the majority of the debt when projects are underway.
Another type of working capital loan that is becoming increasingly popular for construction contractors is Accounts Receivable Factoring. The business lender purchases unpaid receivables for a discount price and pays the borrower right away, shortening a business cycle from at least 30 days to just a couple of business days.
Accounts receivable factoring allows contractors to work with virtually anyone since they’ll essentially be paid upfront no matter what the project’s contract says. Larger projects typically come from clients who take more time to pay. But with accounts receivable loans, you can effortlessly agree to their terms without worrying about how you’ll pay your team in the middle of the project.
And you don’t have to receive a single payment. We can distribute certain amounts of cash at different intervals, which is ideal for contractors because they work in phases, and each phase has its own costs.
Rather than wasting precious time negotiating and jeopardizing client relationships, you can devote 100% of your attention to figuring out what you’ll need to complete your newest project. Apply now to see how much you qualify for!
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