Financial issues and impacts of construction industry in Kedah and Perlis

Every stage of a construction project has a time and cost aspect. Project delays are normal and frequently happen in the construction industry. A short delay can be costly in the long run. It will have an effect on all those involved. Delays have a massive impact on completing deadlines for projects, managing cash flow, and maintaining the appropriate level of quality. This paper aims to identify the financial problems facing by the contractor of construction sector and their effects on the projects in Kedah and Perlis. The goal of the study was to identify the options and tactical approaches that may be used to address these financial issues, as well as to analyse the causes, consequences, and repercussions of these issue. Six respondents who
were chosen based on their expertise and skill in managing building projects in rural areas with more than 10 years of experience participated in structured interview sessions utilising standard structured questions. This research reveals that the critical financial issues in Kedah and Perlis of the construction industry are the withholding of payment by the approval parties, lack of cash flow management, past due payment received from the client, difficulties in obtaining funds from financial institutions, and inflation. The main impact when the financial issues occur is where the project is delayed, postponed, higher project cost (overrun budget), and poor workmanship. Ways to grow the cash flow, budget, payments from clients, and capable stakeholders were among the recommendations made to enhance and resolve the financial issues encountered, meaning that all of these things had to take place earlier stage in the construction process.