When starting a new project, money is obviously one of the biggest hurdles in your way. Around 27% of business owners have reported that they weren’t able to get the funding they needed for their businesses to thrive.
But this doesn’t apply to just entrepreneurs. Often even contractors can’t pay in full and have to rely on financing to fund their projects.
A loan can make or break a project regardless of what stage it’s in and luckily, alternative lenders exist when the big banks deny your loan.
How the a contractor funding model works
The best contractor funding model involves careful planning to help get your idea off the ground. A smart model involves a few steps to secure success:
- Lease the necessary equipment for your project. Leasing is safer and smarter. You’ll need to put a down payment on the equipment but just think of this as insurance or as an initial investment. If you bring back everything in good shape, you can get that money back.
- Next, take out a loan to help fund the rest of the project. This is self-explanatory, but make sure to have some mockups done beforehand to present.
- Lastly, require upfront payments from your clients to help fund the work. If you’re constantly hearing the word no, consider changing up the contract with your client so they’re providing the bulk of the payment before you get started.
What does this model help fund?
Big name banks approve only 26.9 % of small business loans, leaving the other 56.7% in the dust. Luckily alternative lenders are out there to approve the majority that gets turned down by the bank. Small business loans for construction companies can help cover the cost of equipment, additional labor, and supplies. Ask about fast cash advanced programs to receive your loan, and learn about your affordable payment options as soon as possible.
How contractors benefit from the contractor funding model
Financing can give the working contractor the freedom to bring their vision to life. Small loans for construction company use can help fund their projects and leave them to worry about making their client a lifelong customer. These models also present the contractor with valuable options, so they never feel like they don’t have anywhere to turn.