Skilled trades
Funding for skilled trades, and when it is the wrong tool
Trades spend first and get paid later. Materials, a crew and a truck all go out before the invoice is paid. An advance repaid every day suits steady daily sales, and many trades are paid in lumps. We will tell you when invoice financing or a line of credit may suit you better.
merchant cash advance for skilled trades
Approval is never guaranteed. A funding partner makes the final decision.
What owners use funding for
- Materials for a job, or a run of jobs, before the first invoice is paid
- Specialty tools or equipment, such as scaffolding, a compressor or a trencher
- A truck or van upfit, such as shelving, racks or a lift gate
- Wages for a crew during the gap between finishing work and being paid
- Insurance, licensing or permit costs due before the season starts
How money moves
You pay for materials and wages before the job is done. Then you invoice, and a builder, property manager or commercial client may take 30 to 90 days to pay. That gap between money out and money in is the real cash-flow problem for many trades.Often a poor fit: income arrives in lumps when jobs are paid, and a fixed payment keeps coming in between. How a merchant cash advance works
Does an advance fit?
It may fit when
- Much of your work is smaller jobs or service calls paid by card or e-transfer at the end of the visit
- Revenue is steady across the year, as it can be for service and maintenance trades
- The money buys one piece of equipment that lets you take on work you can already see
- You have checked the payment against your quietest month and could cover it
It may not fit when
- Most income comes from a few large invoices paid 30 to 90 days after the work
- The real need is to bridge unpaid invoices from reliable customers, where invoice financing may match better
- Winter is slow and repayment would run straight through it
- The purchase is a vehicle or heavy equipment that lasts for years, where equipment financing or a lease may spread the cost better
A worked example
Materials for a run of jobs
A small renovation contractor buys materials and pays a crew for several jobs before the first invoices are paid. Repayment is a fixed daily payment. Revenue arrives in lumps, so the slow day below is a day when no invoice is paid and only small card or e-transfer deposits come in.
That is a large share of a slow day. If slow days like this run for weeks, the payment is the part of this example to plan around.
Trades rarely have average days. In a stretch between invoices the payment keeps coming out while little goes in. If most of your income arrives in lumps, ask about invoice financing or a line of credit as well. If one of them fits better, we will say so.
The factor rate and term are assumptions for the example, not a price for this kind of business. It assumes a fixed daily payment and no funding partner fee. A real offer may include fees. Illustrative only. Real offers, fees and payment terms vary by funding partner.
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General information only, not financial or legal advice. Approval is never guaranteed. A funding partner makes the final decision. Terms and eligibility vary by funding partner.
Know the cost. Then grow.
Tell us about your business in about two minutes. We will tell you whether an advance looks like a fit, and show the cost in dollars before you decide.
Approval is never guaranteed. A funding partner makes the final decision.