Plumbing runs on a timing gap: materials and fixtures must be bought before the job is paid, emergency service requires parts and crews on hand, and new-construction and commercial work is paid on slow draw schedules. A profitable plumbing business can still run short between a big material outlay and the payment that covers it. This guide covers how plumbing contractors fund materials, payroll, and equipment.
Why plumbing businesses run cash-tight
Cash flow is uneven between service work and slow-paying construction draws, materials must be funded before payment, and many owners have thin or blemished files. Banks can't move fast when an emergency surge or a big project requires materials and crews immediately.
Funding options for plumbers
Revenue-based funding (a merchant cash advance) advances a lump sum against your deposits and is remitted as a small share of revenue — usable for materials and fixtures, payroll between jobs and draws, and trucks and equipment. Equipment financing fits a specific purchase, and a line of credit suits those who qualify. The advantage of revenue-based funding is speed and approval based on deposits rather than credit.
How approval works
Approval weighs your plumbing business's deposits and revenue, not your credit score or collateral, so a contractor with steady deposits can be evaluated despite credit blemishes. Eligible applications can get a same-day decision with funding commonly within 24 to 72 hours. Not all applicants qualify.
The bottom line: plumbing funding should cover materials and payroll between the work and the payment. Y Millennial Funding is a direct funder of revenue-based funding for plumbing contractors doing $25,000 or more in monthly revenue — a small business loan alternative, not a loan.