How are Single Project Capacity and Aggregate Total Capacity calculated in TradeTapp? (General contractors)

As a general contractor using TradeTapp, the platform will recommend a Single Project Capacity and Aggregate Total Capacity on any completed vendor profile that has financial data available. Here is how our system calculates these values:

For Single Project Capacity

TradeTapp recommends the least (or lowest resultant value) of the three following limiting formulas:

• 1 to 1.5 x “Largest Completed Project” (range depends on available “Working Capital”)
• 4 x “Working Capital” (Working Capital = "Current Assets" - "Current Liabilities")
• 25% x “Average Revenue” (up to rolling 3 years)

For Aggregate Total Capacity

TradeTapp recommends the least (or lowest resultant value) of the three following limiting formulas:

• 10 x “Equity”
• “Working Capital” / 7.5%
• 125% x “Annual Revenue”

Important considerations for capacity recommendations:

• Capacity recommendations are different from internal limits, and are not visible to Basic users or BuildingConnected Pro users. Financial, Reviewer, and Acceptor users are able to view these recommendations.
• Capacity recommendations are only as good as the quality of the data being evaluated.
• Capacity recommendations do not factor important qualitative information that your company may know or learn about a vendor. 

When a value is shown, you can hover over it and a note will tell you which specific calculation was used to achieve the value shown. 



Based on these capacity recommendations, you can then determine and enter in your own internal single or total limits for this vendor in the Company Review section by clicking "Edit Qualification Status". 



You can also automate the setting of internal limits according to your own methodology by implementing Custom Ratios & Limiting Factors. For instructions on how to implement these to your account, please reference, “How to automate your internal limits in TradeTapp (General contractors)”. Please contact your TradeTapp Account Executive or Customer Success Manager accordingly to adjust how your account calculates these limits.

Frequently Asked Questions

Why is the Single Project Capacity or Aggregate Total Capacity $0? 

When calculations for the single project capacity and aggregate total capacity are run, if the lowest resulting value is negative, TradeTapp will populate $0. In these cases, we suggest checking the variables that contribute to the calculation of that capacity.

For example, Working Capital may be low. Working Capital is the vendor's current assets minus their current liabilities. You can check the Financial Input on the vendor to see if the numbers are entered incorrectly, but if their current liabilities are greater than their current assets, that could be a reason why their capacities are $0. 

Want to learn more about risk assessment in TradeTapp? Download the TradeTapp Risk Assessment Overview.