The following content is sponsored by GCPay.

In 2022, late payments cost the construction industry $208 billion. These payment issues don’t just affect the financial state of businesses — they trickle down into delays and work stoppages across projects. And boosting prices to absorb costs isn’t a resolution for this problem.

Payments to subcontractors can represent more than 75% of a project’s cash outflow, and being able to manage invoices, lien waivers, compliance documents, and other expenses efficiently is paramount to the success of the project and company.

Furthermore, the construction industry has been slow to adopt new technology, most especially in the back office with their accounting and finance teams. GCs oftentimes don’t recognize that automating what has historically been manual or paper-based workflows not only saves time and money but also can actually land them more work. Many builders are already using construction-specific accounting software, so being able to extend the capabilities of those enterprise resource planning (ERP) solutions by leveraging other software can be game-changing.

That’s where automated subcontractor management solutions come in. Cloud-based accounting and payment management solutions ensure subcontractors are paid and projects move forward. And several of these software applications integrate directly with construction accounting solutions, which eliminates “double entry” accounting processes. Furthermore, these solutions not only automate the actual payments, but also manage the exchange of conditional and unconditional lien waivers and compliance documents, which the GC uses to pay their subcontractors. 

With the power of accounting and payment management solutions, GCs can modernize their payment processes to save time and money while also ensuring their clients’ projects are complete and compliant.