Contractors face a cash flow paradox. Your backlog is strong and projects profitable, but money never arrives when needed.
Materials must be paid for before installation. Workers are paid weekly, but payments arrive 30–60 days later.
Retainage—the 5–10% withheld on every draw—compounds the problem. It won't be released until project closeout.
A business line of credit is the standard tool for bridging this gap. A revolving LOC works across all your jobs simultaneously.
The Contractor Cash Flow Problem
Construction cash flow problems are structural, not a sign of poor business management. The billing and payment cycle creates predictable gaps: