7 Ways a Working Capital Loan Can Benefit Your Construction Company
Running a successful construction business takes determination, knowledge, hard work, and significant resources. But even thriving construction companies encounter cash flow issues that can pose major problems. Due to the challenges like long payment cycles and seasonal lulls in sales, cash flow can be rather inconsistent in the construction industry. So how can you prevent your construction company from running out of cash? One of the best solutions is a working capital loan.
What is a Working Capital Loan?
A working capital loan is a loan used by businesses to cover a wide range of everyday expenses when cash flow is tight. It’s an ideal solution for businesses who are short on cash and may need more capital to stay afloat. It can also help if your business has a large opportunity on the horizon that will tie up some of your cash. A working capital loan is quick, hassle-free, and doesn’t require perfect credit.
How Can a Working Capital Loan Help My Construction Business?
Working capital loans are one of the most flexible financing options available to construction businesses and the number of ways it can be used may surprise you. Here are 7 examples of ways you can use a working capital loan to benefit your construction company:
- Purchase Tools and Equipment
Working capital will allow you to purchase new tools, bulldozers, vans, or excavators. You could even use the funds to buy new office equipment like computers or printers.
- Improve Cash Flow
Having to wait an extended period of time to get paid is a common challenge in the construction industry. With cash tied up in outstanding invoices, a working capital loan can help you fund day to day operating costs like rent and utilities. This will help you improve cash flow while you’re waiting to get paid.
- Ramp Up Your Marketing
With a working capital loan, you can redo your website, purchase new business cards and brochures, or even launch a new marketing campaign to advertise your services.
- Make Payroll
Your employees are one of your most valuable assets. They count on you every week for their paychecks so it’s important to ensure that employees are paid consistently and on time. If you’re struggling to make payroll, consider a working capital loan before it negatively affects your business.
- Purchase Materials for an Upcoming Project
Oftentimes a construction company has to order and pay for upcoming project materials before they’ve ever been paid. A working capital loan can help you alleviate some of the stress and financial burden of having to lay out money and buy materials upfront.
- Expanding and Growing Your Construction Business
Don’t sacrifice growth because of lack of capital. A working capital loan can help you seize the opportunity to expand your business or add new services to offer your customers. Whether you need funding to purchase a new location, hire additional employees, or renovate your office space, a working capital loan can help.
- Pay Subcontractors or Suppliers
Maintaining a good relationship with your subcontractors and suppliers is vital to the success of your construction business. In order to keep them happy, pay your bills on time. Don’t risk losing their trust and hurting your business because you’re short on cash and can’t pay up. If you’re struggling to pay subcontractors or vendors, you may want to consider a working capital loan.
Apply for a Working Capital Loan Today
ViewRidge Funding can get you the working capital that your construction business needs— providing additional cash flow for nearly every situation. Apply today and get approved in hours – there’s no cost or obligation and our single page application takes only minutes.