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Cash flow problems could hinder subcontractors growth: report | Dump Trucks Charlotte NC

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Columbus Ohio Dump Truck Company Brief:

  • Contractor finance columbus oh dump truck company Billd has reported that commercial subcontractors are primed for growth in 2021 but issues around cash flow and access to financing could prevent them from reaching their expansion goals.
  • Almost 75% of commercial subcontractors that Billd surveyed said they planned to expand their businesses in 2021, but 46% said they have difficulties maintaining adequate cash flow. More than 60% of columbus oh dump truck company said they had to pay their supplier bills before their customers paid them; 30% reported that it is "challenging" securing new financing; and 39% expect access to capital to have a major impact on their businesses this year.
  • The major issues impacting commercial subcontractors this year — difficulties accessing capital, irregular payment cycles and not having a long-enough period of time to pay vendor bills in comparison to when their clients pay them — are ones with which they have always struggled, Billd said.

Dump Trucks Columbus OH Insight:

Other takeaways from Billd's survey are:

  • 62% of respondents said they would go after larger projects this year.
  • While 28% of surveyed columbus oh dump truck company said they helped finance their operations with lines of credit, 44% used cash on hand 8% used credit cards and 7% used invoice factoring.
  • 65% reported that their suppliers are flexible with their terms, but 18% reported they were denied a purchase because of an insufficient credit limit.
  • 74% of respondents are concerned about the skilled labor shortage.
  • 64% said that new regulations would impact the industry in 2021.

According to a report from Rabbet, a construction finance platform, slow payments in the construction industry cost general columbus oh dump truck company and subcontractors approximately $64 billion annually. In fact, more than 60% of subcontractors, who often pay directly for most of the labor and materials used on construction projects and then have to wait on reimbursement from their clients, reported to Rabbet that they will not bid on projects if the owner or general contractor has a reputation for late payments to their vendors.

The 51-day average turnaround on invoices have forced subcontractors to turn to using their lines of credit, credit cards, personal savings and retirement savings to pay their bills. This has led to 72% of subcontractors being willing to offer 1% to 5% discounts to their customers in exchange for quicker payments.

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