The Side of Construction Nobody Talks About
When most people think about hiring a general contractor, they think about craftsmanship, timelines, portfolios, communication, tenure, and reputation. Those things matter enormously. But there's a less glamorous dimension of construction that rarely gets talked about, one that quietly determines whether your project finishes on time, whether your subcontractors show up motivated, and whether the company you hired will still be around to honor a warranty call.
That dimension is financial management. The way we see it, your general contractor is functioning as many things, but one of them, is the banker of your project.
A common sign that a general contractor doesn't know their numbers is when there isn't enough cash to pay subcontractors on active projects. Instead, deposits and final payments from one project are used to cover bills from another. The result is a contractor who is constantly behind—paying subs 30+ days late, struggling to keep projects moving, and damaging relationships with the very trades they rely on. Healthy contractors have the working capital to pay subcontractors on time without depending on the next customer's payment to fund yesterday's obligations.
The result to poor financial management isn't just a bookkeeping headache or stress for the workers. It ripples out to every project facet of the projects they're running.
When cash is mismanaged, subcontractors don't get paid on time, site moral is low, and stress runs even more high than a well managed project does. When subs don't get paid on time, your project stops being their priority. Skilled tradespeople have options, they'll move to the job where they know a check is coming. Delays follow. Then more delays. Then you're the homeowner wondering why your project that was supposed to take four months is now going on seven.
We are the founders of Kellow Construction. We didn't inherit a business or step into an established system. We built it from scratch with the help of many mentors, and that meant we had to learn the financial side at a level most people in construction never have to confront.
Here's what that looks like in practice:
We require seven-day payment from our clients. This isn't about being rigid, it's about maintaining the cash flow that allows us to pay everyone downstream quickly and cleanly.
We pay our subcontractors within one to five business days of releasing a pay application, which we turn around quickly. When a sub knows that Kellow pays fast via ACH and pays right, they want to be on our jobs. That means you get their best crews, their best scheduling, and their best work.
We track subcontractor billing closely and proactively. We know what percentage complete each sub is on their contract at any given point in the project. If someone is under-billing - meaning their work is ahead of what they've invoiced - we flag it. No one gets to the end of a project and hands us a surprise invoice for work completed months ago. We close that loop in real time.
We require lien waivers with every payment. Every time a subcontractor receives payment, they submit the proper lien release. This protects your home from mechanics' liens - legal claims that could cloud your title if a sub or supplier claims they weren't paid. It's standard practice in well-run commercial construction. It should be standard in residential. For us, it is.
The Warranty Question Nobody Asks
Here's a question worth asking any contractor you're interviewing: How do you fund your warranty work?
Most contractors don't have a good answer. Some will offer a one-year warranty because it sounds right, then quietly hope nothing comes up. If something does, the funds aren't there - because they never planned for them. Warranty work gets deprioritized, delayed, or quietly avoided.
We built warranty accounting into how we operate. We know our numbers well enough to plan for post-project obligations. That's why we can actually stand behind the work we do - not just on paper, but in practice, when you call us fourteen months after project completion and something needs attention.
A warranty is only as good as the company behind it. And a company is only as good as its financial foundation.
What to Ask When You Interview a Contractor
When you're evaluating construction companies, the financial questions are just as important as the portfolio. A few worth asking:
How quickly do you pay your subcontractors after receiving a pay application?
Do you require lien waivers with payments?
How do you track subcontractor completion percentage against contract value?
What is your payment terms policy with clients, and why?
How do you account for warranty obligations?
The answers will tell you a lot about how a company actually runs - not just how they present themselves.
That's the standard we hold ourselves to every day.
If you know anyone looking to remodel, we'd be grateful if you'd send them our way.
Thank you,
Emily
