Won a big contract? Funding wages and start-up costs before the first payment lands

The contract is signed. It’s the biggest one you’ve won. It also needs eight more people on the tools from the first of the month — and the client pays 30 days after month-end invoices. That’s potentially two months of extra wages before a dollar comes in.

Growth like this is a good problem, but it’s a deadline problem all the same. This page is about funding the gap so the contract starts on time and pay day stays pay day.

Why does a new contract create a cash gap?

Because costs start on day one and payments start much later. A typical timeline:

Week	Out	In
0	Onboarding, PPE, inductions
1–4	Weekly or fortnightly wages for new staff
4		First invoice sent
5–8	More wages
8–9		First payment received (30 days after invoice)

Run your own version with real numbers. The deepest point — often around week seven or eight — is the gap to fund.

What does a new worker actually cost?

More than the hourly rate. For each extra worker, include:

• Gross wages under the relevant award or agreement
• PAYG withholding, which goes to the ATO
• Super at the 12% super guarantee rate on ordinary time earnings
• Workers compensation premiums in your state
• Payroll tax if the extra wages take you over your state’s threshold
• Onboarding — PPE, tools, uniforms, inductions, licences

business.gov.au’s hiring employees section is a good checklist if you’re taking on staff for the first time in a while.

How does payday super affect a new contract?

Since 1 July 2026, super for each pay run must be received by the fund within seven business days of payday. The ATO gives a longer window — 20 business days — for a new employee’s first contribution. That helps a little with the first run, but from the second pay run onwards, the super on new staff has to be funded alongside their wages. The payday super page has more.

What’s realistic by timeline?

• First pay run in a few days: smaller unsecured amounts can be funded the same day; $20k – $250k is possible the same day with property security.
• First pay run in a week or two: unsecured cash-flow funding, typically $5k – $500k, sized on turnover and bank statements. A signed contract strengthens the case.
• Large crews or long terms: property-secured facilities up to $5m, possible within 24–48 hours once the property is assessed.

When you have the numbers, send your enquiry or ring the hotline on 1300 752 188.

What to have ready when you call

1. The signed contract or letter of award, including payment terms.
2. Your staffing plan — how many, from when, on what pay cycle.
3. The week-by-week timeline of costs and receipts.
4. Business bank statements, ABN or ACN and trading history.
5. Other contracts in progress and when they pay.
6. Your exit — usually the contract payments themselves. See exit plans.

How do you keep the gap as small as possible?

• Negotiate an upfront mobilisation payment or shorter payment terms for the first invoice.
• Invoice weekly or fortnightly if the contract allows, rather than monthly.
• Stagger hiring so staff start when they’re needed, not all on day one.
• Check the client’s payment record. Large businesses report payment times; see the big customer payment times guide.
• Keep other customers paying on time — a growth contract is a bad moment for your regular debtors to slip.

An illustrative contract start

Illustrative example only. A commercial cleaning company wins a contract for three new office towers starting on the 1st. It needs 14 extra cleaners on fortnightly pay, costing about $48k a fortnight including super and withholding. The client pays monthly invoices on 30-day terms, so the first payment arrives in week nine.

The timeline shows a deepest gap of roughly $190k in week eight. The company arranges an unsecured facility for part of it and uses a small property-secured loan for the rest, repaid over the following three months from contract payments.

What if the contract is with a large business or government?

Big clients bring big contracts, but often long payment cycles too. Before you start, check how quickly the client actually pays. Large businesses with revenue of $100 million or more report their payment times publicly, and the regulator now recognises fast payers of small business invoices. For Australian Government supply chains, Treasury’s procurement-connected policy requires large head contractors on contracts over $4 million to pay small subcontracts within 20 calendar days.

Either way, forecast the first payment on the client’s real record — not the best case in the contract — and size the facility to that. If you can, agree with the client how the first invoice will be submitted and approved before work starts; a rejected first invoice is one of the most common reasons a new-contract gap runs longer than planned.

Start the contract with the cash in place

You’ve won the work; don’t let pay day become the risk. Asking the Deadline Desk what’s possible won’t involve a credit check, and your details stay with us rather than being sprayed across the market. A real person reviews your contract and calls you back.

Please fill in the enquiry form with accurate numbers — the staffing cost, the start date and when the client actually pays — so we can match you to funding that covers the gap from the first pay run. Or ring 1300 752 188.