If you’ve ever had to buy materials upfront and wait to get paid, you know how much it can limit the jobs you can take on. In fact, a Trade Hounds poll found that 70% of tradespeople say upfront material costs have a major or moderate impact on cash flow.
To help address this challenge, Trade Hounds recently partnered with Credit Key, a platform that helps tradespeople manage material costs with flexible payment options. This partnership is designed to reduce financial stress and give you more flexibility—so you can focus on growing your business instead of worrying about cash flow.
In this Q&A, we spoke with Tom Hart, Account Executive, and Courtney Jarrett, Marketing Specialist, from Credit Key, to answer the most common questions tradespeople have about managing material costs, applying for credit, and using flexible payment options. Keep reading to learn how Credit Key can help you keep projects moving while keeping your cash flow under control.
Tom:
The most common cash flow problems we see from a financial support standpoint occur when a contractor doesn't receive materials or labor deposits to start the job. And if they do, it's usually not enough to cover the materials needed. Contractors often put the rest on a credit card, and if they have multiple jobs, they might hit their credit limit. That's where we come into play.
Courtney:
It matters because it solves that timing gap. If you can buy materials today and pay later, maybe after you get paid for the job, you're not putting your business under constant financial pressure just to keep the project moving.
It changes a lot. You free up cash to take on more jobs at once. You might not have to drain personal funds just to cover upfront costs. You’re not relying on credit cards and putting strain on them, and you can keep your projects moving instead of waiting for cash to come in. At the end of the day, it lets tradespeople run their businesses based on the work they're actually doing, not based on what their bank account looks like that week.
Tom:
What I love about Credit Key is that we only need basic information, and everything is instant. Within 30 seconds to three minutes, customers can get approved for a line of credit and pay for their products from a distributor or online as soon as they get approved.
Customers need:
That’s it to qualify for a line of credit.
Courtney:
The application takes less than three minutes. It’s an instant credit decision and doesn’t impact your credit score.
Tom:
At Credit Key, we do all underwriting in-house and use a soft credit pull. A soft credit pull does not impact personal or business credit. There are no banking statements or tax returns required. It's minimal information; they just need to qualify with an EIN number, meet a specific revenue requirement, and then they get approved for a line of credit.
Tom:
Yes, they can. A lot of times, it might be a misunderstanding on the application. We provide access to a web chat, phone number, or email for questions about why they were declined.
Most declines are due to past bad credit or revenue. Revenue needs to meet a minimum of $40,000. Often, they just need to improve their credit scores or ensure trade credits are up to par. We can rerun the application anytime.
Tom:
Great question. We want someone who is an officer or owner of the company, willing to put down a Social Security number. One of the main qualifications is a FICO score of 600. We want to make sure that someone from the warehouse or in the field can't just go and apply and get approved for a line of credit, and the owner knows nothing about it. So, we definitely would like an owner or officer of the company to apply.
Courtney:
The Credit Key app has everything. You can apply directly in the app, manage your account, activate and leverage your Credit Key card, and purchase from hundreds of different vendors that we have on the app that are designated with different categories and filters.
The Credit Key card works like any other card—you draw from your existing line of credit. There are no extra fees and no hard credit check, just more flexibility for your business’s purchasing needs.
For Trade Hounds users, they can apply specifically for Credit Key through the Trade Hounds app. We're seen on the Toolbelt, on our profile page, or you can apply on the Credit Key app directly. There, you can activate your card and have the option to request a physical card. If you'd rather have that, it will be mailed directly to you, or you can use the virtual card, which is right in your Apple Wallet.
You can purchase online or go to any supply house where Mastercard is accepted and use it to buy any material supplies you might need for that job.
Tom:
That means customers will not have any interest for the first 30 days. As long as they pay within 30 days, there’s no interest rate. If they need six months, nine months, or 12 months, there will be an interest rate based on their creditworthiness.
Tom:
When approved, Credit Key offers flexible payment options. You can choose net 30, or three, six, nine, or 12 months. You decide your terms; we don’t dictate them.
Tom:
Every business has a different level of creditworthiness. When they apply, we check Dun & Bradstreet and Equifax, and within 30 seconds to three minutes, it comes back with something like, “You’ve been approved for $40,000, and your interest rate is 1% after the first month.” The first month is at 0%.
That monthly interest rate can change based on the company’s creditworthiness. If there were a few dents from COVID and some struggled payments, that’s not a problem—we can still underwrite those customers. In those cases, interest rates might be 2% or 3% per month instead of 1%.
Tom:
The great thing about Credit Key is that there’s no charge for paying off your terms early. If you choose a 12-month term but pay it off in three months, you only pay three months of interest—not the full 12 months.
Tom:
It all depends on the company’s budget. They need to know their cash flow and what they can afford as a monthly payment. If they receive a large down payment for a project, they might be able to pay it off within the 0% net 30 period or in three months. If not, they may need to stretch it out to six, nine, or 12 months.
It really comes down to the company’s budget—what they can afford monthly and what their available cash flow looks like.
Tom:
I’d let them know that I completely understand their hesitation with buy now, pay later. What I want them to understand is how Credit Key can fit into their daily payment process by freeing up cash flow. They can use it at will—it’s more of a tool to support their business, not a burden on it.
Tom:
I've been here four and a half years and have had hundreds of calls and meetings with electricians, contractors, builders, landscapers, plumbers, and construction companies. They’ve all had success with Credit Key because it’s so simple to use.
Once they’re approved for a line of credit, they don’t have to get approved again—they can keep coming back and using that line of credit over and over, just like a credit card.
Managing upfront material costs doesn’t have to hold your business back. With Credit Key, tradespeople can access flexible payment options, free up cash flow, and focus on completing more jobs without financial stress.
Whether you’re buying materials for a single project or juggling multiple jobs at once, Credit Key gives you the tools to keep your business moving.
Ready to see how it works? Apply now and start taking control of your cash flow today.