How to track Vendor Payables and Settlements in construction?

Construction work is carried out by two categories of people

1. Daily Labours

2. Vendors(subcontractors).

Also , Material Suppliers(Vendor suppliers) help with materials needed to execute the project.

All 3 kind of people - Daily labours , Subcontractors and material suppliers(Vendor suppliers) play a major role on execution of the project in a site successfully. There are multiple vendors like Mason , carpenters , painters , Electricians , plumbers and so on. The materials are purchased from Vendors(suppliers).

The invoices are received from vendors(suppliers) and has to be settled appropriately. Also , every vendor will have a credit period and credit limit also. This has to be settled appropriately failing which will affect the cash flow for the entire company.

Also this results in delay in the execution of work too. Also, the company has to know the priority of settlement to vendors as well.

At any point of time, company has to know the outstanding settlement amount to all vendors also the order of settlement too.

Failing to handle this will result in the following.

1. Poor vendor relationships

2. Productivity loss

3. Project delay

4. Reduced profit in the project execution budget.

Without having a system in place, it is very difficult to manage.