You won a $200,000 job and need $40,000 of materials before the first draw. What funds it?

A contractor doing $60,000 a month wins a $200,000 job. The first draw is at framing, six weeks out; the lumber, the windows and the first payroll are due now. Every contractor forum has this thread, and the blunt advice in it is worth hearing: if you cannot float one to four weeks of a job's costs, you should be careful about bidding it. The more useful version is: fund the float deliberately, before the job, rather than out of the next job's deposits.

The customer's deposit. A mobilization payment of around 10 to 15 percent is common in residential work and unremarkable in commercial, and the first progress payment can be structured for the start date rather than the first milestone. Special-order materials — windows, cabinets, custom steel — are routinely paid in full by the customer before ordering. Ask; the contract is not signed yet.

The supplier. A lumber yard or an electrical distributor will open an account with net-30 terms on a signed contract and a few months of statements, and that is thirty days of materials you do not have to fund. It takes a week to set up. Start it the day you win the bid.

Then the gap. Whatever the deposit and the supplier terms do not cover — the first two payrolls, the subcontractor deposits, the equipment rental — is a working capital loan or a line of credit on your deposit history. Decision in about a day, money in one to three business days, amounts around half to one and a half times a month's deposits. Borrow the gap to the first draw, not the whole job.

The signed contract with its draw schedule. An underwriter who sees $60,000 a month of history and a contract with a $70,000 draw at week six is reading a business about to grow, and will size the offer accordingly. The same request with statements alone is a $60,000-a-month business asking for a lot of money for no visible reason.

Six months of statements, the contract, the supplier quote for the materials, and a one-paragraph note that says what the money bridges and when the draw repays it. That is the whole application.

The draw arrives and the advance is repaid, and the next job needs the same float. If every big job starts with an application, the business is running on advances, and that costs more every year. A line of credit sized to a month of job costs, applied for after this job has cleared and the statements look strong, is how contractors stop doing this twice.