Slow payments hit some construction firms – Sageworks Stats @ Forbes.com
As if weak construction demand isn’t tough enough, it seems contractors who actually find work these days must wait longer to get paid, according to a financial statement analysis by Sageworks Inc.
Sageworks analyzed accounts receivable days for privately held companies in various construction-related industries, including those tied to early-stage work, such as architectural design and foundation work, and those for drywall, flooring and other end-of-project tasks.
The results show that some businesses involved in the earliest stages of projects have fairly steady AR days compared with 2010. But contractors finishing up the projects have seen their AR days stretched.
“Everybody’s holding the money longer,” said Gary Fortier, management advisory services partner for construction accounting firm Large & Gilbert, P.C., of Atlanta.
“I think it’s a sign of the difficult times that we as a construction industry have been faced with,” said Brian Perlberg, senior counsel for construction law and contracts with The Associated General Contractors of America. “I’ve heard that payments have slowed down.”
Read the entire article, including Sageworks data, on Forbes.com here.