As your construction business grows, you may be interested in picking up lucrative government contracts for projects taking place in your area. If this your first time looking for such contracts, you may not realize that you've got to prove you're in possession of a surety bond before your bid is even considered. This kind of bond means that a professional bonding company has deemed you to be a suitable risk and will pay a sum of money to your client if your business is not able to hold up your part of the contract. In order to get this approval from a bonding company and obtain a surety bond, do the following.
Get Your Finances Together
Depending on the size of your company, you may do a lot of the accounting yourself and keep records that only you understand. This has to be changed if you want to impress a bonding company. Have a professional accountant look at your books and come up with a reporting system that is simple for anyone to read and comprehend.
Your bookkeeping system is not the only thing that needs work. You also need to prove that you've got some savings available to the business and that you are not overdrawn on credit. Any loans that you've taken out should be on a repayment schedule that you are able to observe without a problem. Being in a solid financial state will help you seem like a good risk for a surety bond.
Ask for Client References
Another way to look good to a local bonding company is to show evidence. Providing photos of the work you have done is part of the process, but even better are client statements about the process that went into your work. Clients can provide guidance because they can speak to various situations that arose as part of the work that you did. For example, if a bad storm stopped work and you still were able to finish on schedule, that's important for a bonding company to know. If there were strikes or other delays, a client's statement on how you handled those challenges can provide a great deal of guidance that can determine whether you should be given a bond at all.
With these tips, obtaining a surety bond is something that you can expect. Ask local bonding companies, such as NFP, P & C, Inc. about more requirements so you can be sure you satisfy their demands.Share