Abstract:
The basic premise of the client-financed-construction philosophy is that those who commission service
providers must not only pay for their services for the cost of their labour, materials, plant and
equipment but do so in a manner that adds value to all parties. A new framework for proposing,
evaluating and implementing such systems has been conceived which is used for evaluating three nontraditional
approaches for financing construction work, and thereby validating the framework. The
three approaches, namely, ‘rolling advance payment’, ‘rolling material price advance’, and ‘direct
financing’ have been described and analysed with the ‘rolling advance payment’ approach being
described as a revolutionary approach for solving problems connected with financing contractors and
as an approach that has much potential to add value to all parties. The two systems are particularly
useful as a crisis management system in projects saddled with cash flow problems bringing ‘life’ to
almost ‘dead’ projects with potential benefits to all parties. The paper calls for good construction
project management as an essential condition for implementing these schemes with particular attention
given to risk management and local construction culture.
Citation:
Abeysekera, V. (2012). A conceptual framework for client financed construction and non-traditional approaches for financing construction work. In S. Senaratne & Y.G. Sandanayake (Eds.), Global challenges in construction industry (pp. 42-49). Ceylon Institute of Builders. https://ciobwcs.com/downloads/WCS2012-Proceedings.pdf