Owning and running a construction business can be challenging. Ordering supplies and materials, adhering to timelines on multiple projects, lining up subcontractors, and more can eat up quite a bit of capital. With client invoices on staggered schedules or spread out over the timeline of an entire project, how can construction companies maintain a source of capital?
Meeting Financial Obligations
Construction companies have a number of expenses and financial obligations. If there isn’t enough revenue coming in from unsettled client accounts, progress can grind to a halt. Bills are left unpaid, and if payroll isn’t met, workers tend to leave. Loans do not make anything easier. The short-term influx of cash is only good until the next dry spell, with the added burden of debt. Additionally, loans take a while to process, and construction companies need capital quickly to keep projects on track.
The Role of Accounts Receivable Financing
Accounts receivable financing offers a fast and debt-free solution which helps improve the finances of construction companies. Unsettled accounts and unpaid invoices can be turned into cash within 24 hours, supplying construction companies with the capital they need to complete projects, pay financial obligations, and grow their operations. Accounts receivable financing helps to automate the accounting process, which frees up resources so construction company owners can focus on their business instead of having to track outstanding payments or performing collections on overdue invoices.
How Accounts Receivable Financing Works
Accounts receivable financing is a fast and easy process. When an invoice is generated, a copy goes to the customer. Another copy is submitted for financing and converted to cash within one business day. The customer still has to adhere to the staggered payment schedule, but the construction company gets immediate access to working capital. And because accounts receivable financing is an exchange of assets for capital, where the invoice itself is considered collateral, there is no debt placed on the books. The improved cash flow can be used to line up more clients, acquire new equipment, hire more workers, purchase supplies, or anything else your construction company needs.
Accelerate Your Revenue
FSW Funding specializes in accounts receivable financing. We believe businesses should be able to make ends meet and grow without having to go into debt. Contact our offices today to learn more about how accounts receivable financing can help boost your business.