I received an email from a merchant cash advance/receivables factoring company I've used in the past this morning, and must say that I found the email content valuable. Especially during a great 2016 that has seen its overwhelming share of delayed payments, delayed projects, and negative cash flow. I caution every small business against using any merchant cash companies that pull recurring daily or weekly debits from your operating account, as it is a quick way to make a bad situation worse. However, the resource for construction companies here is worthwhile.
Point which resonated most with me: "It takes an average of 24 days" for a construction company to get paid, while "the average construction business only has enough cash on hand to finance operations for 20 days."
😲😲😲
That is a razor sharp cash flow cycle. Try not to get cut out here.
View the report here: Fundbox Construction Article