Construction cash flow runs backwards: materials, labour and mobilisation are paid up front, progress billings arrive in arrears, and retainage — often five to ten percent of every invoice — is held until completion. A contractor can be profitable on every job and still short of cash on all of them at once.
The three gaps in every job
Mobilisation to first draw: you fund the start entirely. Draw to draw: work continues while the last billing is processed and approved. And retainage: a slice of every payment held until closeout, sometimes months after your costs went out.
Each gap is predictable from the contract. Reading them before the job starts — and pricing the funding cost into the bid — is what separates contractors who grow from those who grow broke.
Funding shaped like the job
A line of credit matches draw cycles naturally: fund the work, repay on each billing, draw again for the next phase — paying only between draw and payment. One-off mobilisation on a large award fits working capital with the payback mapped to the draw schedule.
What underwriting reads is the same as any trade: deposits, consistency and conduct across four months of statements. Lumpy is normal in construction — explained lumpy reads fine.
Retainage is not profit yet
Treat held retainage as what it is: money you cannot spend, attached to conditions you have not finished meeting. Contractors who count it as margin spend it twice. List outstanding retainage by job and expected release date — it is both a collection discipline and, when a release is near and documented, useful context on a funding application.
Growing without outrunning your cash
Every new job added widens the funded gap before it adds profit. The discipline is a simple test before bidding: can the account carry this job's mobilisation and two billing cycles on top of current work, with funding included? If not, the bid needs staging, deposits, or a facility arranged first — after award is the expensive time to arrange money.
Read next: Construction funding · Contractor equipment · Business line of credit
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