A new contract starts tomorrow and you need to fund the start

Winning a contract should feel like good news, and it is. But a new job often means spending money before any comes in: materials ordered up front, a crew on the payroll from day one, equipment hired, fuel, insurance, permits. The first payment might be weeks away.

When the start date is tomorrow and the account won’t stretch to cover the start-up costs, the gap needs funding fast. Fortunately, a signed contract is one of the most persuasive documents you can hand a lender.

How big is the start-up gap?

Before you think about funding, map the cash flow from tomorrow until the first payment reaches your account. A simple table is enough:

Week	Cash out	Cash in	Running gap
Week 1	Materials deposit, wages, equipment hire	Nothing	Growing
Week 2	Wages, materials balance	Nothing	Growing
Week 3	Wages	First claim submitted	Peak
Week 4–5	Wages	First payment received (if on time)	Closing

The peak of that running gap, less what you can cover yourself, is roughly what you need. Add a buffer: first payments are often slower than expected, especially while a new client sets you up as a supplier.

Check the contract for payment terms, milestone definitions and any retention held back. Each one affects the timing.

What does a lender want to see?

A contract start is a strong, understandable purpose. The lender’s main questions are whether the job will be paid, and whether the business can deliver it.

• The signed contract or purchase order, with the value and parties.
• The payment schedule: milestones, progress claims or invoicing terms.
• Your cash plan: the simple table above, even handwritten.
• Business bank statements, to show the business trades reliably.
• Evidence you’ve done similar work, if the contract is larger than usual.

For trading businesses, unsecured funding sized on bank statements can be possible quickly for smaller amounts. For a larger start-up gap, property-secured funding of $20k to $250k can be possible same day.

If the job starts tomorrow, enquire tonight and have the contract ready to send first thing.

How do payment terms change the picture?

Longer terms mean a bigger, longer gap. If the client pays 30 days after month-end, the first payment for work started early in a month may not arrive for close to two months.

Large businesses and some government enterprises must report how quickly they pay small business suppliers under the federal Payment Times Reporting Scheme. It exists because slow payment strains small business cash flow, and the published reports can give you a sense of how a large client tends to pay.

If you’re still negotiating, it’s worth asking for:

• A deposit or mobilisation payment on signing.
• Shorter payment terms for the first claim.
• Fortnightly rather than monthly claims.

What if I win contracts regularly?

If contract starts are a normal part of your business, arranging funding from scratch each time is slow and stressful. A standby line of credit lets you draw for each start-up gap and repay as payments arrive. Setting it up in a quiet period means the next win is simply good news.

An illustrative example

Illustrative: A commercial painting contractor in Brisbane wins a four-week job repainting a school during holidays, starting tomorrow. Materials of $23,000 must be paid on collection, and wages for a crew of six run about $15,000 a week. The school pays on 30-day terms after each monthly claim. The owner maps a peak gap of about $58,000, can cover $18,000, and enquires for $40,000 that evening, attaching the purchase order. The business owns its small warehouse. Property-secured funding is possible the next day, repaid when the claim is paid.

Which costs usually land before the first payment?

Every trade and industry is different, but the start-up spend tends to fall into the same buckets:

Cost	When it usually hits	Tip
Materials and consumables	Before or on day one	Ask suppliers about 30-day trade accounts for repeat orders
Wages for the crew	From the first pay run	Include super, which under Payday Super now follows each pay run
Equipment hire	Weekly in advance	Check whether the client supplies any plant
Subcontractors	On their own terms, often fortnightly	Align their terms with your client’s where possible
Insurance, permits and site set-up	Before work starts	Often forgotten in the cash plan
Fuel and travel	Daily	Small, but it adds up on remote jobs

If equipment is the big-ticket item, our page on equipment that broke down covers repair-or-replace decisions, and if the gap comes from a client paying late later in the job, see a customer who paid late. The money-tomorrow checker can test whether tomorrow is realistic for your start-up amount.

One more practical point: keep copies of every claim and the client’s acknowledgement as the job progresses. If you need a second round of funding later in the contract, or want to set up a standby limit, a clean record of claims and payments makes the next conversation much quicker.

Start the job on the front foot

A new contract is growth, and funding the start shouldn’t hold it back. It takes about 60 seconds to enquire and there’s no credit check involved at that stage. Your details go to one team — they’re not spread across multiple lenders — and a real person who understands contract cash flow calls you. Please share the contract value, start date and your accurate cash plan, so we can size the right facility first time.

Fund the contract start →