Qualitative Analysis of Cash Flow Policies and Their Impact on Large Commercial General Contractors in the Southeastern United States

摘要

The number of business failures in the U.S.construction industry is significant.Over the past several decades,construction businesses have gone bankrupt at one of the highest rates of all U.S.business entities.Cash flow problems are one of the primary causes of these failures,and in many cases more so than a lack of profitability.In the construction industry,this aspect can often be as important as the technical and managerial components of a project's delivery.This paper presents a qualitative analysis of the cash flow policies targeting commercial general contractors in the southeastern United States,whose annual volumes are between 250 million and 1.5 billion.Policies are examined with respect to the cost of construction financing,percentage of self-performed work,retainage,mobilization costs and payments to subcontractors and vendors.From this data,best practices are recommended for contractors operating or who wish to operate in similar markets.