Invoice Factoring for Sand and Gravel Contractors

September 22, 2016 Uncategorized 2 Comments

A growing company means there will come a time when every sand and gravel contractors business will need more working capital.  Cash for things like making payroll, buying supplies or taking on bigger or new jobs. It can be challenging for sand and gravel contractors to wait the 45, 60 or more days for customers to pay their invoices.  The economic climate over the last few years has made it hard for companies to get a bank line of credit. Finally, sand and gravel contractors have another option, accounts receivable factoring. Invoice Factoring can provide relief to your sand and gravel business by giving access to immediate working capital without your customers having to pay quicker than they normally would.

The Four Easy Steps to Accounts Receivable Factoring
Accounts receivable factoring can provide your business with a continuous source of operating capital, here is how construction factoring works at Construction Finance:

Benefits of working with a factoring company

If you go to a bank for a loan they will consider whether your company is financially sound.  Factoring companies don’t look at the size of your business, how long you have been in business or your creditworthiness. In fact, factoring companies look at the creditworthiness of your customers. If your business has a creditworthy commercial customer base with unpaid invoices you can benefit from factoring.

Additional benefits of accounts receivable factoring:

  • The sand and gravel construction business owner does not incur any debt as they are “selling” the receivable as long as their customer pays the invoice.
  • You can to take advantage of early payment discounts from suppliers, as the factoring company will often pay your creditors right away.
  • You no longer need to offer early payment discounts because you are getting payment right away from the factoring company.
  • The factoring company will do due diligence on your customers, ensuring that they are credit worthy, so in turn giving you often free professional credit monitoring of your clients.
  • You can concentrate on growing your business instead of wasting your time worrying about when you are going to get paid.

Construction Invoice factoring may not be the first option you thought of when thinking of a cash solution for your sand and gravel construction business, but it can be the perfect solution to your working capital flow challenges.  It can be just what you need to get the money for your sand and gravel construction business to make payroll, buy supplies, pay vendors and grow your business.

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About the Author

Dia Sawyer

Dia Sawyer

My husband John Sawyer and I have 8 children and run an amazing business, Construction Finance. We have been married 23 years and are busy looking for new construction clients all while taxiing our busy children to activities.

  • Umesh Sharma

    September 29, 2018at4:31 am - Reply

    i am sr. accountant in construction firm. i have 6 years experience.

    1. Tipper Coker

      Tipper Coker

      October 9, 2018at3:11 pm - Reply

      Well hello Umesh,

      That does not sound like an easy job!

      If there’s ever anything I can help you with, please don’t hesitate to let me know.

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