All Forum Posts by: Josh Holden

Seth I am not sure we are on the same page. I asked about Mobilization draws.

My investor responded today and is not able to commit. He has a partner and they were not in agreement. So I contacted the GC and he said they do offer mobilization draws from time to time. He asked me to submit my bid with the conditions and they would let me know. I will let you know how it turns out.

Seth, I suppose if a GC helps walk a quality sub through the process that GC may find a diamond in the rough. With traits like outstanding work ethic, dedication to the project, meeting deadlines at all cost. 

I found this on the Business Bank of Texas website. Thanks for clearing up the terminology Brett. Either I misheard my former client or he said it incorrectly, either way.

Smart cash management pays big dividends

A mobilization draw provides cash flow even before your progress billings begin. Without the mobilization draw, the project becomes a drain on cash at the very beginning of the job. It goes cash flow negative from day one. And going cash flow negative hurts your company in a number of different ways, including:

• increasing the chance that you will need to borrow money
• reducing your profit if you end up borrowing money
• increasing risk since you will be carrying a larger receivable for a longer time
• reducing the number of projects you can work on at any given time
• forcing you to use cash that could otherwise be used to grow the company

Seth that answer is in the OP

Thank you for the responses. I worked for a GC on a remodel last year and they purchased equipment and gave me what they called a 'normalization fee' or as Brett called it a mobilization fee. I understand that point of view Seth but when a GC breaks ground don't they have money upfront from the bank? Things have loosened up a little but my take is $20k a week, which is what rough in will be, is quite a bit to fund on someone else's project. Could not the same be said for a GC not willing to put down a 'good faith' deposit? Thank you all again, this is the first forum I have found where people actually answer the question with an answer and not another question.

Hi all, I am a mechanical contractor breaking into multifamily. I have done some remodel but I am bidding my first new construction project of 294 units. I would like to know what subcontractors typically ask for upon start-up? Total cost of mechanical is around $1,000,000 for 294 units. Thanks for any info