Whether you are taking on one construction project at a time, or multiple projects simultaneously, working capital is essential for productivity and efficiency. However, since most invoices get paid on schedules ranging from 30 to 90 days, construction companies often find themselves juggling finances to cover overhead costs, make payroll, purchase materials, and keep projects moving. Fortunately, there are better working capital options available to construction companies instead of traditional debt-based loans.
Accounts Receivable Financing
Construction companies work hard to deliver results, so why should they have to wait a month or longer to see revenue? Accounts receivable financing turns invoices into cash within 24 hours. This allows construction companies to improve cash flow to keep costs covered and accumulate capital to take on larger projects. Because accounts receivable financing is a simple exchange of invoices for capital, no debt is placed on the books and credit ratings are preserved. The fast turnaround also frees up resources which would otherwise be used to track outstanding payments across multiple accounts. Accounts receivable financing also eliminates the need to perform collections, because invoices never get a chance to “age out.”
Asset-Based Lines of Credit
Some construction companies need a reusable source of working capital that they can access at any time. Asset-based lines of credit offer such a solution. A revolving line of credit is structured around the value of owned assets such as equipment, machinery, and receivables. Just like other business lines of credit, capital is accessed as needed, and then repaid with interest. Asset-based lines of credit from Derix Capital Finance are interest-only, and much easier to use than loans from traditional lending channels. Asset based lines of credit offer an additional source of working capital to help cover costs and keep projects on track.
Get the Capital You Need Today
Derix Capital Finance specializes in solutions for construction companies. Whether you want to boost your cash flow with accounts receivable financing and stop waiting on long payment schedules, or if you need a reusable source of capital with an asset-based line of credit, we’ve got you covered. Contact the experts at Derix Capital Finance today and get the funding you need for long-term success.