This last year's economic downturn has been hard on a many businesses, and especially hard hit, was the construction industry. This sector is responsible for building our nation's houses, corporate facilities, factories, apartments, offices, schools, roads and bridges. General contractors and sub-contractors still may be experiencing cash flow problems - meeting payroll or purchasing supplies.

Divided into three basic areas, construction includes: 1) Building, including general contractors who build residential, industrial, commercial, and other buildings. 2) Civil engineering construction where contractors build roads, bridges, highways, and tunnels, and 3) Specialty trade contractors, who work on projects such as carpentry, painting, electrical or plumbing.

These jobs are not just about new structures, but often require site preparation, repairs, maintenance,or improvements on old projects.

The construction industry supports architects, engineers, inspectors, appraisers, brick masons, carpenters, electrical and drywall contractors, flooring and tile contractors, and even asphalt companies, all of whom could take advantage of invoice factoring to help them get by during challenging economic times..

Construction jobs are usually done by general contractors, who specialize in one type of construction such as either residential or commercial building. They are in charge of the entire job, and although general contractors may do a portion of the work with their own crews, they often subcontract work to specialty trade contractors who typically do the work of only one

They obtain orders for their work from general contractors, architects, or property owners. Repair work is almost always done on direct order from owners, occupants, or architects

The construction industry is dependent upon economic business cycles, therefore even changes in interest rates and tax laws affect individual and business decisions related to construction. Changes in state or local regulations or budgets can result in new construction or a cancelled job.

Thanks to factoring among contractors during the last year, this tactic has helped provide the cash flow needed to pay suppliers, meet payroll and pay for insurance, as well as workmans compensation. Construction factoring enables businesses to obtain funds based on their current accounts receivables, so they can go ahead with the next phase of a project, rather than wait till the invoices are paid.

Construction is one of several industry sectors that can benefit from invoice factoring. Why? Because when factoring is used, the sub-contractor, or construction company, does not have to wait for payment before starting on the next phase of a project, or begin construction on a new project. With invoice factoring, the sub-contractor or construction firm can realize quick turnaround, from 24 to 48 hours, on accounts receivable due for completed stages of a construction project. With construction invoice factoring, the construction company, or the sub-contractor, can be paid overnight for accounts receivable invoices, which speeds up cash flow and improves the company's ability to start immediately on the next phase of construction for each project.


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A marketing professional, Kristin Gabriel works with The Interface Financial Group (IFG), North America's largest alternative funding source for small business. The company provides short-term financial resources including invoice factoring, serving clients in more than 30 industries in the United States, Canada, Australia and New Zealand. IFG offers expertise in construction factoring, accounting, finance, law, marketing and banking.