Covering a Seasonal Cash Gap in Construction

A construction company covers its seasonal cash gap by arranging financing before the slowdown, while its bank statements still show the busy season: a line of credit for fixed costs and spring materials, factoring on signed-off progress billings, and equipment refinancing if machines are paid off. Map the months first, so you borrow only for the real gap.

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By Chady Zahri, Chief Executive Officer · Updated October 8, 2026

Voxen insight

Ask for the line of credit in October, not in April. The statements a lender reads in the fall show your best months; the ones it reads in spring show your quietest, at the exact moment you need the money most. Same business, different file.

Why construction cash runs short after the busy season

In construction, cash follows the work with a delay. A phase is finished, billed, and paid 30, 60, sometimes 90 days later, with holdbacks on top. In a Quebec winter, billings drop while insurance, equipment payments, the office and key staff keep costing the same. Collections from the fall carry the business into January. The squeeze usually comes after that, when spring work restarts: crews, materials and fuel are paid weeks before the first new invoice is collected. The faster the ramp-up, the deeper the dip: a contractor that doubles its crews in April also doubles what it pays out before April's invoices are collected.

Map the gap month by month

Before choosing a product, put the year on one page: what you bill each month, when each bill is actually paid, and what goes out. The illustration below uses round numbers for a contractor whose clients pay 60 days after billing, whose job costs run at 60% of billings, and whose fixed costs are $40,000 a month. Replace them with your own.

Month	Billed	Collected (billed two months earlier)	Costs paid	Net for the month
January	$20,000	$150,000	$52,000	+$98,000
February	$20,000	$60,000	$52,000	+$8,000
March	$80,000	$20,000	$88,000	−$68,000
April	$200,000	$20,000	$160,000	−$140,000
May	$300,000	$80,000	$220,000	−$140,000
June	$350,000	$200,000	$250,000	−$50,000
July	$380,000	$300,000	$268,000	+$32,000

Illustration only. Costs paid = 60% of the month's billings + $40,000 fixed. From March to June this business pays out $398,000 more than it collects.

Set up the financing before the slowdown

The best time to arrange seasonal financing is late in the busy season, when six to twelve months of bank statements show your strongest deposits. Applied for in March, after three quiet months, the same business looks weaker on paper than it is. Arrange the limit in the fall, leave it undrawn through the winter if you can, and draw on it when spring costs start to outrun collections. An unused line of credit costs nothing to keep open on Voxen's lines. Size the limit to the deepest point of your own table, not to a round number: in the illustration, that is the $398,000 paid out between March and June, less whatever cash the business still holds from the fall.

Matching each part of the gap to a product

Fixed costs and spring materials: a line of credit. You draw what the month needs and repay as collections come in, paying interest only on the amount drawn.
Signed-off progress billings that are still unpaid: invoice factoring advances part of the invoice now, based on the general contractor or owner who owes it. Amounts held back until the end of a job are not paid until then, so do not count them as spring cash.
Paid-off equipment: equipment refinancing turns the value of machines you own into working capital.
New equipment for the season: equipment financing, so the machine is paid from the work it does rather than from the operating account.

Use the slow months for training

Winter is when crews have time to train, and Quebec's MFOR business stream helps pay for staff training, with amounts set case by case. Training does not close the cash gap, but it turns quiet weeks into something useful, and the program's support lowers the cost of doing it then rather than in July.

What Voxen looks at in a construction file

Voxen looks at a full year of activity where it can, because one season's statements say little about a seasonal business: monthly deposits across the year, the receivables aging and who owes them, the equipment you own and what is still financed, and the payments you already carry. The construction industry page covers progress billing and equipment in more detail. If your own reserves already cover the gap, you do not need a facility, and we will say so.

What to do next

Fill in the month-by-month table with your own numbers to find the size and timing of your gap. Then apply with Voxen before the slowdown, with twelve months of bank statements and your receivables aging.

Frequently asked questions

When should a contractor apply for a line of credit?

Late in the busy season, when your bank statements show your strongest months. A file prepared in the fall reads better than the same business applying in March after a quiet winter.

Why does my cash run short in spring rather than in winter?

Fall collections usually carry a contractor through the first months of winter. In spring, crews, materials and fuel are paid weeks before the first new invoices are collected, so outflows run ahead of inflows until summer collections arrive.

Can I factor progress billings?

Progress billings signed off by the general contractor or owner can be factored, based on who owes them. Amounts held back until the end of a job are not paid until then, so they are not near-term cash.

Can I refinance equipment to get through the slow season?

Yes, if the equipment is paid off or nearly paid off. Refinancing turns the value of machines you own into working capital without selling them.

Is there a government program for a contractor's seasonal gap?

None of the programs checked pays a contractor's seasonal cash gap. Quebec's MFOR business stream can help pay for staff training during the slow months, with amounts set case by case.

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