Dispatch #24 - Call Your Banker and Surety Agent

When was the last time you called your banker?
 
A contractor-savvy banker can help your construction firm make better decisions and get through times like these.
 
Your banker does not want to starve your company of capital, take possession of your company’s vehicles, or foreclose on your home. Your banker wants to help your firm use capital to earn a profit and generate positive cash flow so your company succeeds and they get repaid in full.
 
But your banker can’t help you if they don’t know what’s happening.

• Tell them what your team is doing to get through this period (e.g. daily or weekly financial huddles, reducing costs, collecting A/R, and contacting customers to secure any essential work that can be done safely)

• Send them your forecasts

• Demonstrate that you’re aware of your bank covenants and if you’re concerned the company might drift out of compliance, share this concern with your banker.

As an experienced and successful banker once told me, “You can’t over communicate to your banker.”
 
Ask for your banker’s guidance. She or he knows construction, and knows your business.
 
Much of the same applies to your surety agent, too.

Need help with this or other financial matters faced by construction contractors? Let’s talk!

David Stern CFO makes every effort to provide useful and accurate information. This content, however, is not intended as a substitute for specific business-related financial advice. We disclaim all warranties and liabilities from its use.