It is very common for IDs to “roll money” till bankrupt

You might be thinking, don’t most businesses do this?

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Client A pays the ID for a job, which only starts 2-3 months later. ID then uses this money to pay off the costs of their previous jobs. 2-3 months later, Client B comes along and pays the ID for a new job. ID then uses Client B’s payment to pay off Client A’s job. Then comes Client C, D etc.

This seems like a perfectly normal cash flow thing right? 

But here is where the problem comes. What happens if there’s no Client C or D?  

In the renovation industry in Singapore, this rolling of money is not uncommon. The difference, vs other businesses, is the magnitude.

Each roll is easily tens of thousands, or even hundred of thousands. This is why many of the big players in the past have scaled down significantly over the years due to liquidation issues.

There’s a reason why we are sharing this now.

In the previous post, we shared that the industry is, and has been on a declining trajectory since 2023. There are too many ID firms, too many IDs, yet too few projects.

Without sufficient projects, the ID won’t have money to pay off the previous jobs, and the threat of them closing down becomes very real. 

This means if you are the last client to pay, they do not have any more money coming in to pay for your job. Chances are, they may very well collapse before they are able to complete your job.

This is why once again we strongly suggest homeowners to do your own research before committing to any ID firm.

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