Construction Archive

Construction credit is a highly volatile business, in which risk is contingent on the project’s progress and outcomes. Cash flows down the “ladder of supply,” a tiered structure that determines when each stakeholder receives payment. With suppliers at the lowest tier, credit professionals are typically the last to obtain funds. To secure payment for work performed, contractors, subcontractors, laborers, suppliers and, in many states, design professionals, may file a mechanic’s lien, or a legal claim against the improved property. By doing so, they enact legal recourse to claim unpaid deb…

The U.S. Postal Service clarified in a Dec. 24, 2025 rule that postmarks reflect when mail is processed at a USPS facility—not when it’s dropped off, accepted at a counter or stamped in a mailroom. Why it matters: In many states, deadlines for filing mechanic’s liens and other time-sensitive documents are tied to the postmark date on the notice. Previously, postmarks reflected the deposit date, giving credit managers a reliable way to time lien notices and contract deadlines. The recent announcement clarifies that postmarking occurs when an item is processed, not deposited, which could c…

In construction credit, money is flowing down the ladder of supply and material suppliers and service providers selling to subcontractors are vulnerable to delayed payments—or worse, not getting paid at all.  The critical first step in effectively managing construction credit is gathering and verifying job information, especially identifying everyone involved in the project. Why it matters: Overlooking those involved in the project during the early stages can be risky, especially when forgetting to notify key players of a preliminary lien notice can compromise a credi…

No matter the industry or region, credit professionals share one common goal: collecting payment from customers. For some, this means establishing favorable terms and conditions. For others, it hinges on building strong customer relationships. Construction credit, however, is far more nuanced.  Why it matters: With construction projects, additional parties and conditional clauses can cause payment delays or legal complexities that make it difficult to secure funds. Depending on the state and project type,&nbs…

The Disadvantaged Business Enterprise (DBE) Program, a federal program that offers marginalized businesses a fair opportunity to compete and thrive in competitive business environments, is being overhauled by the federal government, leaving credit managers working with DBEs in unfamiliar territory. The U.S. Department of Transportation (DOT) issued an interim final rule on Oct. 3, 2025, restructuring their DBE and Airport Concessions DBE (ACDBE). The ruling eliminates race- and sex-based presumptions of social and economic disadvantage. Why it matters: With the new ruling, currently c…

In a construction project, many elements come into play: planning, design, financing, materials, contracts, workforce and more. At the end of the day, everyone in the supply chain, from the owner to the supplier, wants to get paid. For credit professionals, the concern is the same.  Why it matters: Credit professionals who understand and enforce their lien rights are more likely to secure payment for construction projects. Florida mechanic’s lien law dictates who can file a lien, which notices …

Gathering job information for a construction project is critical to the work of a credit manager, collecting pertinent information on the customer and the key players in the project so that you understand the degree of risk incurred as you embark on a project. While this process is intrinsically tied to the work and concerns of a credit manager, the responsibility of gathering information can also fall on the sales team.   By the numbers: According to an eNews poll, 52% of credit managers find that gathering job information is a joint effort between credit and sales teams, foll…

California Governor Gavin Newsom signed SB 440, or the Private Works Change Order Fair Payment Act, into law on October 10. The law, which goes into effect at the start of 2026, introduces a newly structured process of resolving change-order and time-extension claims on private works of improvement.   The law, which passed unanimously in the State Assembly and Senate, was championed by contractor advocacy groups that believed the restructuring of the claims process could reduce litigation and help more companies get paid on time. Contractors are praising SB 440 for the fair and…