Cinium Blog

contractor business plan

4 Questions to Ask Contractors Before They Become Clients

As an agent, you have the ability to help new and emerging contractors to grow their businesses. But to do that, it’s important that you understand your contractor clients to see if they’re ready to take on bonded projects, what steps they need to take to grow, and how you as an agent can help them.

Here are four questions that can get you started.

1. Do They Have a Contractor Business Plan?

Business plans can take many forms. The key aspect of a business plan is that it demonstrates that your contractor clients understand the capabilities of their business, and how their business can compete within your area.

A good business plan should:

  • Lay out their goals and strengths as a business.
  • Help them understand how their business can stand out from the crowd.
  • Detail the kind of work they intend to do, and the projects they plan to take on.
  • Demonstrate that they understand the market(s) they are serving and where they fit in that marketplace.
  • Provide realistic projections of income and profit. Ideally, you should try to plan for at least three years ahead.

If your potential client doesn’t have a business plan, encourage them to develop one.

If they have a business plan, take the time to read it, and don’t be afraid to offer feedback. You may be able to provide a broader understanding of the industry in your area that can be invaluable to them as they develop their plan.

2. How Organized Is Their Back Office?

A contractor client may be an expert when it comes to their trade, but what about their back office?

Are they having trouble paying their bills on time? Are they having problems with effectively tracking payments from project owners? Have they applied for a bank line of credit or a surety bond, only to find that their balance sheets are out of balance?

If the answer to any of these questions is “yes,” they may need some help managing their financials.

If they don’t already use accounting software, it never hurts to recommend programs like Quickbooks™ which offers construction accounting software designed for contractors. The software also includes great tutorials. This can be especially helpful if they (or a family member) are managing the books themselves.

Using accounting software also makes it easier to generate the financial statements required to get bond requests and bank lines.

3. Do They Have the Support They Need?

As an agent, you can do more than simply help your contractor clients to submit a bond request. You can also help them network with the support services that they need.


Managing the finances of a contracting business, even a small one, requires experience and understanding of the complexities of the industry. Every contractor should be working with a CPA, preferably one with experience in construction accounting. They don’t need to work with them all year round, but when they have one, they should use them as a resource to gain insights into how to better manage their finances.


Not every bank targets the construction business, which means that not every bank may be equipped to meet a contractor’s needs. Knowing which banks in your area understand the complexities of a contractor’s cash needs and cash flow challenges can make a big difference for your clients. Cultivating relationships with these banks and being able to refer your clients can help everyone to grow their business.


Even experienced contractors understand that no one gets anywhere without help. Don’t be afraid to make connections between up and coming contractors and your more experienced clients.

Most experienced contractors know how hard it is to build a business and will welcome the opportunity to share the lessons they’ve learned.

Not only will the newer contractor learn, but creating these relationships can help them to find future projects.

4. How Well Are They Managing Their Cash Flow?

For contractors, cash flow is the life blood of their business. The ability to effectively manage cash flow is a sure sign of the overall financial health of a contractor client.

If cash flow has been an issue in the past, there are ways for them to improve things for the future.

Getting a bank line of credit can help to provide them with the funds they need to pay for materials and cover labor costs. This is where your connections and expertise can help to get them started.

Once a project starts, your clients may also find that there’s a delay between when they need to meet critical expenses and when they can expect payment from the project owner.

That’s where recommending a service like Cinium’s Requisition Cash Advance program can help. This allows your clients can get the funds they need to ensure that everyone gets paid on time and your project goes smoothly.

These questions can help you to assess your contractor’s strengths, and help you to help them build their business and your own.

Want to learn more about approved Requisition Cash Advances other features of Cinium’s Contractor Credit Program? Download our free guide.

Ready to put Cinium’s experience to work for you? Schedule a free consultation today, or give us a call at (855) 4-CINIUM.

Download The Agent's Guide to the Contractor Credit Program


Free Contract Bond Quote

Get your free contract bond quote. We bond commercial projects with a minimum bond amount of $100,000.

Contact Us

Learn how Cinium can help your business
Call sales855.4.CINIUMOr have us contact you Fill out the form and one of our representatives will contact you within one business day.
Contact Us