When Sullivan's Electrical Services won a substantial bid for a second phase of university student housing they were ecstatic. "We worked very diligently with the general contractor and engineer on the project to ensure our bid met their requirements." After we won the project, we were a bit overwhelmed by the cost of mobilization for the project. Funds, we simply did not have."
Ted Sullivan reached out to his banker and discussed the difficult situation and the huge upside of the opportunity. "Our banker was sympathetic to our problem, but was unable to offer us any workable solution. He recommended we talk to Gateway! "Within days of our initial conversation with Ted, we had a workable solution with his suppliers and implemented Vendor Guarantees along with ensuring Ted had funds for his payroll needs." Thanks to my banker and his referral to Gateway, we're underway on a project that's expected to last 18 months."
How does an electrical service contractor utilize project start-up funds which are not there? As an electrical contractor, you know that this is a question you ask yourself on a regular basis. Every contractor looks forward to those small projects that do not require a lot of start-up cash and can generate revenue quickly. But it is the big projects that allow a contractor to develop a positive reputation and grow. It is also those bigger projects that can become a financial disaster if not handled properly.
Every Electrical Service Job Takes Cash To Get Started
Most people do not realize just how much money it costs a contractor to get a project underway. Even a small project requires permits, materials, and labor to get off the ground. It could be a month before the contractor gets paid and, in the meantime, there are more projects to do. That is why contractors are usually very creative when it comes to funding their businesses.
Banks Are Sometimes Unable To Help
When people drive around an area and see large construction projects underway, they will often see banners announcing what banks had helped to fund the project. The problem for you and your electrical contractor business is that the first payments do not usually arrive for at least 30 days. It is great that the job owner secured funding for the project, but that does not help the contractor to get the funds he needs to mobilize his crews.
A/R Financing Companies Become Great Partners For Contractors
As resourceful as contractors can be about financing, it is always amazing to find out how many contractors have never heard of electrical services factoring. One of the reasons some contractors avoid a/r financing companies is because they do not think that these kinds of companies can help when there are not initial invoices to factor. It is time to put that myth to rest.
As a contractor, it is imperative that you become intimately familiar with all of your business financing options and receivables factoring will be that financial service which allows you to start projects that will put your company on the map. A A/R financing company will work with your existing invoices to make sure that your expenses and payroll is always covered.
Grow Your Electrical Contracting Business With A Real Financial Partner
The next time your contracting gets the large project that could turn you into a major player in your area, there is no need to turn that project down. All you need is to talk to our electrical service our receivables company expert to set up the most beneficial financial partnership you will ever have. Our A/R financing company has all of the solutions you need to pay your start-up costs now and to keep paying those bills as the project moves along.