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Have you ever really needed your debtor to pay and they haven’t come through in time? And now salaries are due. Or a supplier needs paying.
Your options aren’t great - use your own funds, pull funds from your interest-offset account on your mortgage, pay on the business credit card (if there is limit available) - or worse still - your personal credit card.
Or maybe this one’s more familiar: you've done the quote. You've won a big job. But you need specialist materials, or extra guys on site, to deliver the job.
This is where a Line of Credit comes in. Here's how it works.
A line of credit isn't a fixed loan. It's a pre-approved amount of money you can draw from when you need it, repay, and use again. With a Laddr line of credit, you only pay interest on what you actually use, not the whole amount. For trade businesses managing the gap between buying materials, hiring staff and getting paid, it can be a much better tool than a standard loan or a credit card.
When you take out a business loan, you get a lump sum. You repay it over a fixed period with fixed repayments. Whether you need all of it or not, you're paying interest on the whole amount from day one.
A line of credit works differently.
Think of it like a tap. You get approved for a set limit — say, $20,000. That money sits there available to you. Turn the tap on when you need it, turn it off when you don’t.
On a Laddr Line of Credit, you only ever pay interest on the funds you are actually using. If you've got $20,000 available but only use $5,000 this month, you pay interest on $5,000. Use it to cover a debtor who is 1 day late, pay interest for 1 day.
For trade businesses with lumpy, unpredictable cash flow, that flexibility – and confidence that you have funds available when you really need them – is worth a lot.
Credit cards are a form of revolving credit — so in that sense they're similar to a line of credit. But there are a few important differences for business use.
Interest rates. Business credit cards typically charge higher interest rates than a business line of credit. If you're carrying a balance for more than a few weeks, it adds up fast.
What you can buy. A credit card is designed for everyday purchases. A line of credit is designed for business - including buying materials, managing payroll, or bridging a cash flow gap between a large job and the invoice being paid.
Repayment structure. Credit cards have minimum monthly repayments that don't always align with how your business gets paid. A line of credit can give you more flexibility to repay when the money actually lands.
Separation from personal spending. Using a business line of credit keeps your business and personal finances clean — important at tax time.
Here's the reality for most plumbers and HVAC businesses: money flows in lumps.
You finish a job, invoice, and wait. 30 days. 45 days. Sometimes longer if a client drags their feet. Meanwhile, the next job needs materials, your crew needs paying, and the super is due.
That gap — between buying materials or paying costs and getting paid for the work — is the cash flow gap. And it's not a sign that your business is struggling. It's just how trade businesses work.
A line of credit sits in that gap. You use it when you need to, and repay it when the invoice lands. Then it resets, ready for the next job.
Laddr is a line of credit built specifically for Reece trade customers.
Here's how it works in practice:
Complete a simple online application form through your maX account in just a few minutes – no paperwork, no hassle.
We’ll review your details fast and let you know your outcome straight away.
Once approved, you have a facility that you can draw down and pay back any time. Pay interest only on the funds you use and for the days that you have them.
A line of credit isn't the right tool for every situation. Here's when it makes sense, and when it doesn't.
Good fit:
Not the right fit:
The key is using it as a timing tool, not a dependency. It bridges the gap between when you spend and when you get paid, not as a way to spend money you haven't earned.
A loan is a one-time injection. A credit card can be expensive and built for the wrong things. A line of credit is flexible, sits ready when you need it, and costs you nothing when you don't.
For trade businesses that buy materials upfront and wait on invoices, it's one of the most practical financial tools available.
See how the Laddr line of credit works →
General information only — not financial advice. Talk to your accountant or financial adviser about what's right for your business.
