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ARTICLE · 04 MARCH 2020

Building cash flow - how to encourage on-time payment from construction clients

Bartier Perry Solicitors
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Article discusses the SOP Act, when it applies & how it helps to improve the likelihood & timeliness of payments.

AustraliaReal Estate and Construction
David Creais
David Creais
Mark Glynn (Formerly With Bartier Perry)
Mark Glynn (Formerly With Bartier Perry)
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Prompt payment to contractors and suppliers is vital to the stability of the construction industry – an industry that contributes significantly to the strength of the Australian economy.

Suppliers of plant and equipment, whether by sale or hire, are important in the delivery of construction projects.

While levels of construction activity remain high, the Australian Financial Review on 4 November 2019 reported on a survey by McGrathNicol Advisory, which revealed that engineering and construction companies are taking an average of 3 months to pay suppliers.

What's more, while Australian companies overall are paying creditors 2.9 days faster in 2018-19 than they did a year earlier (for an average of 63.5 days), engineering and construction companies are taking 12.4 days longer to pay (up to 87.6 days).

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