Financing projects while encouraging growth has always been a balancing act for business owners. The construction industry is no different, and an uptick in storm activity plus shifts in insurance payouts are adding even more challenges to an already complex aspect of the building landscape.
Jordan Gilmore, managing partner at ABC Supply’s Lexington, Kentucky, location, has seen that complexity and its impact on customer cash flow firsthand,even when their businesses are booming. “Imagine selling multiple roofing jobs in a day but not being able to start them due to delayed payments from past jobs,” says Jordan. “It’s a constant juggle to cover overhead costs while waiting for insurance reimbursements.”
This issue has only worsened since mid-last year, particularly in storm-affected areas where claims stack up and insurance payments are backlogged. Contractors are often left waiting months for payments, putting a wrench in their project’s momentum. “Insurance approvals are harder to come by, and payouts are taking longer,” Jordan observes.
Adding to these challenges, checks over $10,000 often require mortgage companies’ approval, causing further delays. These operational hiccups prevent contractors from starting new projects and securing the overhead required for labor and material expenses.
A contractor’s approach to their business operations can also impact cash flow, especially if new project sales are prioritized over collections. Jordan encourages contractors in this situation to incentivize their sales representatives to focus on both aspects of the business, ensuring that timely payments for completed projects maximize cash flow available for new jobs.
Tailoring Solutions to Contractor Needs
ABC Supply associates’ recommendations are rooted in extensive, big-picture knowledge of market trends. From their experience working with a wide variety of businesses, associates can provide contractors with insights into industry conditions and specific applications of those insights to customer businesses.
“Our branch managers and outside sales representatives have knowledge in the marketplace that contractors sometimes don’t. We see 300 businesses at a time and understand what’s affecting them, giving us a broader perspective that we can share with our contractors,” Jordan says.
ABC Supply’s Customer Financial Services (CFS) team also provides tailored financial solutions that address individual contractor needs, helping bridge cash flow gaps and offering flexible financing options. While credit options are a common way contractors can see relief, the team works side by side with customers to develop custom approaches that fit their unique circumstances. “Our CFS team doesn’t just provide credit lines; they understand our business,” says Jordan. “They help contractors navigate financial hurdles, offering insights and support that go beyond typical supplier relationships.”
From credit lines that ease financial pressures to expert market advice, ABC Supply is committed to supporting contractors through every challenge. Contact ABC Supply today to learn more about how they can help you manage your cash flow and grow your business.