An Investigation Into The Challenges Facing Building Contractors At Various Stages Of Their Existence In Financing Projects

Abstract

The capital cost of a construction project is a concept that should be considered by parties involved in a building project. Adequate capital enhances good contract performance with regard to the production of projects that are compliant with the parameters of a construction process that is; budget, time and quality. Construction industry is a leading sector in creating employment opportunities. Thus it is important that contactors, who are the major participants in this industry; have an environment that is conducive for them to facilitate their growth, to enable them create employment opportunities and to be an efficient organisation. This study is aimed at establishing the stage of existence that building contractors experience severe financial constraints. A period of twenty years of contractors’ existence was analysed in four quarters each comprising a period of five years; first five years, second five years, third five years and the last five years. Questionnaires, that had differentiated questions for different periods under study, were distributed to contractors for them to express the stage at which they experienced severe financial constraints and also express the effect of these constraints on contract performance. The researcher established that these factors affected contractor’s performance in a longitudinal pattern. Poor performance was identified to be at the initial stage and a remarkable improvement was noted as time of existence progressed. Thus the researcher came up with a conclusion that financial constraints are likely to discourage newcomer contractors into the industry. The researcher recommended that prospective builders should have adequate seed capital before they start construction business. This will enable them finance construction works easily at their initial stage of existence and also enable them to have a good plan for growth which in-turn make them to be competent contractors.