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If you are not qualified to fix your engine…..what makes you qualified to be a subcontractor’s banker?

Posted by in Contractor Factoring, Funding Products






So the check engine light has decided to stop by for a visit….. now what?  I own a lot of tools that cover a wide range of projects; none are used to diagnose a vehicle.  I let the local mechanic review and explain the correct resolution.

I have seen my share of applications come across my desk for review and some  fall to the wayside because the GC in hindsight has offered to work with the subs – in some fashion to provide funding support… which means they  have pockets deep enough to also support all the risk ?  Really???

Tools- tools- tools- the right tool for the right job. How many tools do you need to diagnose a check engine light?- computer adaptor- electrical tools- vacuum line gauges- pressure gauges- and on and on…

The funding side has the same quantity of tools in place to ensure the subcontractor is adequately funded and the surprises are limited to a minimum…. If a subcontractor is reaching out for any type of funding assistance you better ask why… Balance Sheet- WIP- credit scores- overall company stability- A/P statements and a signature somewhere that states  ” funds for this project will be used to satisfy debt on this project and only this project”  You don’t do that??? Hmmm

Mr. GC…. This sub was qualified in-house to participate on a specific project… so you are familiar and comfortable with seeing their name on reports? How often do you revisit your qualifications criteria? What aspects of the company are considered as acceptable- Workmanship/ reputation/associations? How about annual company financials/ balance sheets/ credit scores/and searches from the tax liabilities or ongoing litigation?

Can I diagnose my check engine light? – Nope – Can you risk playing banker? – Maybe- Do you have the resources in place to identify issues before they become losses? – That’s what my RMS division does on a daily basis….. We qualify the sub/ fund the project/ disperse the funds/ collect the lien wavers/ and identify any and all negative issues to ensure the sub has the financial ability to see the project through to its completion.

Can you play banker? – Maybe – Is it worth the risk???

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