Studies On Construction Contractor's Credit Management

Market economy is also credit economy. A healthy market needs credit. However, nowadays, there is a lack of credit in Chinese construction market. One of the most distinct inflections of credit absence in construction market is that construction owner defaults a lot of payment to construction contractor. The owner's non-payment behavior increases the contractor's business risk, threats the contractor's subsistence and holds back the successful development of construction market.In the background of prevalence of non-payment, a suggestion is made that contractor should establish institution of corporation credit management. Via corporation credit management, contractor can pick up the speed of reclaiming debts, reduce the credit risk resulted from owner's non-payment and thereby reinforce the corporation competence in the dog-eat-dog construction market.On the basis of study and analysis of the concept of the credit and credit risk between construction owner and contractor, three aspects of contractor's credit management, according to the sequence of construction project management, are discussed in detail one by one. These three aspects of contractor's credit management are credit assessment of owner before tender for project, contract management of payment in the course of construction and debt management after the issue of payment certificate.It is not enough to solve the non-payment problem only by means of contractor's credit management. The whole construction market credit system is another key factor to solve this problem. However, it is not a right way that contractor cannot start running credit management until the construction market credit system arises, because the contractor's subsistence is also involved in non-payment problem. Furthermore, the establishment of contractor's credit management institution will not only accelerate the modern enterprise's innovation and reduce credit risk resulted from non-payment, but also have an active effect on the foundation of the construction market credit system.