Construction cash flow
Helping developers and contractors understand cash flow in the construction industry
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Pages in this SectionWhat is construction cash flow?
Construction cash flow refers to the movement of money into and out of a construction business over a specific period. Managing this cash flow effectively is critical to ensuring projects are completed on time, subcontractors and suppliers are paid, and operations run smoothly.
Why is cash flow so important in the construction industry?
Construction businesses often face a unique set of cash flow challenges. Projects can involve large upfront costs such as labour, materials, and equipment hire, before any client payment is received. This means firms are often out of pocket for weeks or months at a time.
Cash flow issues can lead to:
- Delayed project delivery
- Inability to pay suppliers or wages
- Stalled growth or missed opportunities
- Greater reliance on costly short-term finance
Strong cash flow management is essential not just for survival, but for securing new contracts and fuelling long-term growth.
Common construction cash flow challenges
Some of the most frequent cash flow pressures facing the construction sector include:
Slow payments
Clients may take 30, 60, or even 90+ days to pay invoices
Retention payments
A percentage of payment is held until project completion, delaying income
Scope creep and delays
Projects that overrun add to costs without generating additional revenue
How to improve construction cash flow
Here are some of the ways construction businesses can stay ahead:
More favourable terms
Negotiate better payment terms with clients and suppliers
Cash flow forecasting
Forecast cash flow regularly to anticipate shortfalls
Access funding
Access funding that’s designed for the construction sector
Construction finance options to support cash flow
At Novuna Business Cash Flow, we help construction firms unlock the cash tied up in unpaid invoices through flexible construction finance solutions. These include:
Invoice factoring for construction companies
Receive up to 90% of the invoice value within 24 hours
Working capital finance
Access working capital as and when you raise new invoices
Why choose Novuna for construction cash flow support?
We’ve worked with construction companies across the UK to deliver fast, flexible funding tailored to the needs of the sector. With no hidden fees, dedicated account managers, and support that scales as you grow, we make it easier to take control of your cash flow.
Have you ever thought about invoice finance to help improve your cash flow?
Invoice finance allows you to release cash quickly from your unpaid invoices.
As your lender, we can release up to 90% of your invoices within 24 hours. On payment of the invoice from your customers, we will then release the final amount minus any fees and charges. There are different types of invoice financing options available to businesses depending on the situation and the level of control they require in collecting unpaid invoices.
We are an invoice financing company who offer a solution whereby payments are collected on your behalf managed by our team of expert credit controllers so you can focus on running your business. Our confidential invoice discounting solution is offered to businesses who want to maintain their own credit control processes, therefore this remains strictly confidential so your customers are unaware of our involvement.
Get in touch
Contact our friendly UK advisors on our freephone
0808 250 0859
8:45 - 17:15 - Monday to Thursday &
8:45 - 16:45 - Friday
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Want to understand more cash flow finance terms?
Our Cash Flow Finance Resource Hub has been set up to help SME's with cash flow finance advice, tips and resources to help with their cash flow position.
We explore ways you can begin improving your cash flow situation and start getting your business on track to positive cash flow.
