Where There’s Smoke There’s Bankruptcy

Do you know what to do if your client on a construction project goes bankrupt? ​ ​
Where There’s Smoke There’s Bankruptcy

Is this something you’ve thought about?

Today’s video is How to LOSE Money as a Construction Contractor. Watch it here or continue with this quick read.

Here’s a story about a scaffolding company.

They were very industrially heavy– you know, involved in oil and gas and mining. So more of an access company than just your basic scaffolder.

This company came in with teams and equipment for a shutdown. ​

What’s a shutdown?

This is when an aspect of a project is shut down for a few days to weeks to do quick maintenance or fix a problem. They’re done in very structured and organised ways. ​

Shutdowns are EXPENSIVE. They often require 24 hr labour which is costly.

So this scaffolding company was working on this shutdown project and what started to happen was their invoices stopped being approved. ​

And they were being rejected based on very minor details.

@%$# THIS IS A RED FLAG #$%@


When all of your invoices are being questioned this signals WARNING. ​ ​

Next came rumours… ​ ​


The client wasn’t paying a lot of the invoices on the project. ​

This signals metaphorical smoke… and where there’s smoke there’s?



Long story short the client went bankrupt. The scaffolder was owed 1.8 million. The thing about liquidation or bankruptcy is that once it’s happened it’s almost always GAME OVER. ​

However, it’s not all bad news if you know the system. There’s an order of preference in which creditors will get paid.


  • Government
  • Banks
  • Shareholder
  • Supplier

So being bottom of the list you need to make sure that you’re at the front of your queue.

  • Be the loudest person (the squeaky wheel gets the oil)
  • Make sure you have ALL your documentation submitted.

When you hear rumours, think smart. A lot of companies de-man– i.e. they stop spending money because they’re worried about getting paid. And get all your documents in order. ​

We want you to be the MOST SUCCESSFUL you can possibly be. That’s why we put together content with tips and advice that is tried and tested.

For more contractual advice, Quantum Contract Solutions is here to guide and assist you through everything contract related. Let’s reduce risk in your contracts and save time and money, just click this link to get our FREE case study to show you how clients just like you are doing it.

Get the Contracts System That Construction Company CEO's, MD's & GM's Have Been Talking About

Scroll to Top
Scroll to Top