You’ve done the work.
You’ve issued the invoices.
Customers owe the business $750,000.
But there’s only $42,000 sitting in the bank.
Payroll is coming.
Suppliers need paying.
Fuel accounts are due.
There’s another large job ready to start.
And one of your biggest customers isn’t paying for another three weeks.
This is the point where business owners often start searching:
business finance
cashflow loan
invoice finance
working capital
fast business loan
But before applying for anything, there’s something more useful we can do.
Work out exactly where the cash is, when it’s coming, how much you actually need and what type of finance might fit the gap.
For a Darwin transport, civil, construction, equipment, labour-hire, trade or commercial business, that distinction can make an enormous difference.
First: How Much Money Do Customers Actually Owe?
Get the current aged debtor report.
Not the figure you remember from last week.
Not:
“About $700,000.”
Get today’s report.
Perhaps it says:
Current: $410,000
30 days: $210,000
60 days: $95,000
90+ days: $35,000
Total: $750,000
Now we have somewhere to start.
Next: Which Customers Are Actually Paying Soon?
The total debtor figure doesn’t tell us when cash arrives.
Look through the major accounts.
Perhaps:
Customer A owes $180,000 and normally pays next Friday.
Customer B owes $120,000 in three weeks.
Customer C owes $95,000, but $30,000 is disputed.
Customer D owes $70,000 and usually pays late.
That’s much more useful than:
“We’re owed $750,000.”
We’re starting to build a cashflow picture.
How Much Cash Do You Need Before Those Payments Arrive?
Now look at the other side.
What needs to leave the business before the customers pay?
For example:
Payroll: $85,000
Suppliers: $70,000
Fuel: $35,000
Equipment finance: $28,000
Insurance and overheads: $12,000
ATO payment: $20,000
Total:
$250,000.
Available cash:
$42,000.
Expected customer receipts before those expenses fall due:
perhaps $80,000.
Now the problem isn’t:
“We need money.”
It’s approximately:
“We have a short-term funding gap of $128,000.”
That’s a much better finance conversation.
Don’t Automatically Borrow $500,000
This happens.
The owner sees $750,000 in receivables and thinks:
“Let’s get a $500,000 facility.”
But perhaps the immediate recurring requirement is only $150,000.
Or perhaps the real requirement is $600,000 because the business is about to double in size.
We need to calculate it.
Borrowing capacity and borrowing requirement aren’t the same thing.
Then Ask Why the Gap Exists
Is it because:
customers pay in 45 days?
sales have grown rapidly?
you’ve won a new contract?
customers have recently become slower?
the business bought equipment with cash?
stock levels increased?
a major customer is late?
ATO debt is consuming cash?
the business is losing money?
These situations can look identical from the bank account.
They aren’t identical from a finance perspective.
Scenario One: Good Customers Simply Pay in 45 Days
This is the classic timing problem we’ve followed throughout this journey.
The business completes profitable work.
Customers pay reliably.
But commercial payment terms mean cash arrives weeks after costs have been incurred.
Debtor or invoice finance may potentially be worth investigating where suitable eligible commercial receivables exist.
Scenario Two: One Customer Is Late
Suppose the business normally has no working-capital problem.
But a $250,000 customer payment has unexpectedly moved from Friday to three weeks later.
That’s potentially a temporary issue.
Don’t automatically restructure the company’s entire funding model because of one unusual payment delay.
We need to understand whether the problem is temporary or recurring.
Scenario Three: The Business Is Growing
Revenue has gone from:
$500,000 per month
to
$900,000 per month.
Customer payment behaviour hasn’t changed.
The business simply has much more money sitting in receivables.
That’s potentially a growth-funding problem.
The appropriate facility may need capacity to grow with the business.
Scenario Four: Customers Are Getting Slower
This is different.
Revenue hasn’t increased significantly.
But the debtor ledger has.
Invoices that used to be paid in 30 days are now sitting for:
45,
60,
90 days.
Before borrowing more, understand why.
Finance shouldn’t become a substitute for credit control.
Scenario Five: You Spent the Working Capital
Perhaps the business had $300,000 in cash.
Then it bought a truck for $180,000.
Now the bank account is tight.
The debtor cycle hasn’t changed.
The business simply converted liquid working capital into a long-term asset.
That tells us something important.
The truck and the cashflow requirement may need to be treated separately.
The Truck May Have Been Financeable
Depending on the asset, borrower and transaction, eligible trucks may potentially be financed.
The same principle can apply to:
trailers,
utes,
vans,
excavators,
loaders,
forklifts,
agricultural equipment,
and other business assets.
Using all available cash for equipment can leave a profitable business unable to fund operations.
Scenario Six: A New Contract Starts Next Week
This is particularly important.
A Darwin civil contractor wins a major project.
Excellent.
The first invoice might not be paid for six weeks.
But starting the project requires:
employees,
subcontractors,
diesel,
materials,
vehicles,
accommodation,
and equipment.
The business might need hundreds of thousands of dollars before receiving the first meaningful payment.
Don’t wait until week five to calculate that.
Map the First Eight Weeks
If a major contract is beginning, estimate each week.
Week 1
What gets paid?
Week 2
What gets paid?
Week 3
What gets paid?
Then:
When is the first invoice issued?
When is it approved?
When is it actually expected to be paid?
That reveals the mobilisation funding requirement.
The Contract Value Isn’t the Funding Requirement
You’ve won a:
$4 million contract.
Fantastic.
But that doesn’t tell us whether you need:
$100,000,
$500,000,
or $1 million
to service it.
The timing of expenditure and receipts determines the working-capital requirement.
Scenario Seven: There’s ATO Debt as Well
Suppose:
customers owe $750,000,
the business needs $150,000 working capital,
and there’s also $220,000 owing to the ATO.
Don’t automatically combine those numbers and say:
“We need $370,000.”
There are potentially two problems.
Historical tax debt.
Future working capital.
If we clear the tax debt but don’t fix the cashflow cycle that helped create it, the problem may return.
Scenario Eight: Short-Term Loans Are Already Everywhere
Perhaps the business already has:
two business loans,
a credit card,
a revolving facility,
equipment finance,
and ATO debt.
Now cash is still tight.
Adding another loan might be possible.
But first we need to understand the existing repayment burden.
Sometimes the business doesn’t need more debt.
It needs better debt structure.
Write Down Every Existing Facility
For each one, record:
balance
repayment
repayment frequency
remaining term
security
purpose
This can reveal something immediately.
Perhaps the business is paying substantial weekly repayments on loans originally taken to solve working-capital shortages.
That can itself be contributing to today’s cashflow pressure.
Don’t Forget Personal Money Going Into the Business
Owners often say:
“The business is surviving.”
But when we investigate, the owner has contributed:
$20,000,
then $30,000,
then another $50,000.
That’s important.
The business may be consuming more cash than its operations generate.
Tell us.
We need the real picture.
Now Look at the Options
Once we understand the problem, different structures may potentially be investigated.
Depending on the business and circumstances, that might include:
debtor or invoice finance
where suitable commercial receivables are driving the working-capital requirement.
an overdraft or revolving facility
where access to fluctuating working capital is required.
business finance
where a defined amount is required for an appropriate purpose.
asset finance
where trucks, vehicles, machinery or equipment need funding.
property-secured commercial finance
in appropriate circumstances.
There may also be other structures.
We don’t need to decide before looking at the business.
You Might Need More Than One Facility
That’s not automatically a problem.
Imagine the business needs:
$250,000 working capital
plus
two $220,000 trucks.
Perhaps working capital is addressed one way.
The trucks are financed another way.
That can be more logical than trying to make one loan perform every job.
But More Facilities Isn’t Automatically Better Either
Complexity has a cost.
The business shouldn’t end up with seven different finance products simply because seven lenders were willing to provide money.
We need to consider:
repayments,
security,
fees,
administration,
and how the facilities interact.
The objective is a workable structure.
What Should You Send Us First?
If you need working capital now, don’t spend three days trying to prepare a perfect finance application before speaking with us.
Start with the basics.
Send:
current aged debtor report
approximate amount required
major customer names
usual payment terms
recent monthly turnover
existing working-capital facilities
details of major contracts or upcoming work
any planned truck or equipment purchases
Then explain what’s happening.
Tell Us the Actual Problem
Something like:
“We invoice about $600,000 a month. Customers generally pay in 45 days. We have $780,000 outstanding and need approximately $200,000 additional working capital because we’ve taken on another contract.”
Excellent.
I understand the problem.
Compare that with:
“What’s your cheapest business loan?”
We haven’t learnt anything about what the business needs.
Don’t Be Embarrassed by the Numbers
If there’s:
ATO debt,
an overdue supplier,
an old invoice,
a customer dispute,
or a short-term loan,
tell us.
Finance applications rarely become easier because important information appears halfway through the process.
The sooner we understand the complete position, the sooner we can work out where the potential options are.
What if You Don’t Know How Much You Need?
That’s fine.
We can start by calculating it.
Look at:
cash currently available,
customer receipts expected,
expenses due,
the debtor cycle,
new contracts,
growth plans,
and existing finance repayments.
The answer might be very different from the number you initially expected.
What if You Need the Money Urgently?
Tell us exactly when.
“Urgent” can mean:
tomorrow,
Friday payroll,
next week,
or before a contract starts next month.
Those aren’t the same timeframe.
Finance takes time to assess, document and settle.
The earlier we understand the deadline, the better.
Don’t Wait Until the Account Is Empty
This is probably the most important practical lesson from this journey.
If you can already see that:
the debtor ledger is increasing,
a large contract is beginning,
customers are moving to longer terms,
or sales are growing rapidly,
start investigating working capital before the crisis arrives.
A business with cash still in the bank has more room to make deliberate decisions.
Darwin Business Example
Imagine a Darwin transport and civil-services business.
It has:
$850,000 in commercial receivables.
Customers generally pay in 30 to 45 days.
The company has just won additional work.
It needs:
another truck,
additional employees,
and approximately $250,000 more working capital.
That’s not simply:
“We need money.”
It’s potentially:
working-capital requirement + truck requirement + contract growth.
Now we can investigate each component properly.
The Next Question Might Be About the Truck
And that’s where our next journey begins.
Because once working capital has been protected, many growing businesses face another decision:
How do we finance the asset that’s going to generate the next dollar of revenue?
A truck might need replacing.
Another prime mover might be required for a new contract.
A business might be deciding between:
new or used,
dealer or private sale,
auction purchase,
large deposit or preserving cash,
truck only or truck and trailer,
replacement or repower.
Those decisions deserve their own journey.
Working Capital and Invoice Finance Around Darwin
Businesses around Darwin and the Northern Territory can operate across transport, civil construction, resources support, equipment, trades, logistics and commercial services where costs are incurred well before customers pay.
Having $750,000 sitting in receivables can look like a strong position.
And it may be.
But you can’t pay Thursday’s wages using the number at the bottom of an aged debtor report.
The business needs cash at the right time.
That’s what working-capital planning is ultimately about.
Customers Owe You Money and You Need Cash Now?
Send Thrive Broking your current aged debtor report and tell us:
How much do you think you need?
When do you need it?
When are the major customer payments expected?
Why has the gap occurred?
What’s changing in the business?
If you’re also buying a truck, trailer, vehicle, machinery or equipment, tell us that too.
We can look at the complete requirement rather than automatically pushing everything into one business loan.
You don’t need to know the name of the finance product before you contact us. Tell us where the money is stuck, what needs paying and what the business is trying to do next. That’s where the finance conversation should start.