“An increase in subcontractor failures, more reliance on contractor-obtained financing and the nation’s continuing economic sluggishness highlighted concerns facing members of the Construction Financial Management Association as they met at their annual convention on June 23-27 in Orlando, Fla.
Contractors around the nation are increasingly finding that some specialty firms hired for their projects are unable to finish the job due to financial distress. The topic was especially relevant at CFMA’s first “Large Firm CFO Roundtable,” says Erika Urbani, CFMA chairwoman and chief financial officer with R.D. Olson Construction, Irvine, Calif.
“We are witnessing the financial weakening of a substantial portion of our [company’s] subcontractor base,” Urbani said. Contractors are more frequently finding themselves forced to issue joint checks or pay subcontractors in advance to keep them working, she added.”
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