What is Front End Loading in Construction?

Front end loading is the practice of charging most of the fees associated with a project at the beginning of the transaction. This is especially common when the seller needs the funds to purchase materials prior to the start of work. However, the amount paid by the customer does not necessarily align with the amount of revenue that has been earned, so much of the early charge may be initially recorded as a liability of the seller. This approach reduces the risk of customer default for the seller, since most of the payment has taken place before work begins.

What is Front End Loading in Project Planning?

The term also refers to the concept of conducting the bulk of the detailed planning for a project at its beginning. Doing so reduces the risk of errors occurring later in the project that are more expensive to remediate at that time. While this approach requires the incurrence of significant costs at the front end of the planning process, it tends to reduce the incurrence of much larger and unnecessary expenses later in the project.