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Cash flow

How can a contractor improve cash flow?

Quick answer

Contractors improve cash flow by speeding up inflows and seeing problems early: invoice the day work is billable, run a consistent collections cadence, track and chase retainage, bill every completed draw, watch job costs in real time, and keep a rolling 13-week forecast so a tight week is visible weeks before it arrives.

Speed up the money coming in

Most cash-flow pain in construction is timing, not profitability. Billing immediately, collecting on a cadence, and chasing retainage shortens the gap between doing the work and getting paid, which is the core problem in a sector where payment often takes 60 to 90 days.

See trouble before it hits the bank

A rolling 13-week cash forecast lays expected collections against payroll and bills due, and flags any week that dips below payroll while you still have time to act. Pair that with real-time job costing so a losing job is caught mid-project, not at closeout.

Frequently asked questions

What is the most common cash-flow mistake?
Waiting to invoice and chasing payment inconsistently. The work is profitable, but the timing of cash sinks the business.
How far ahead should I forecast?
A rolling 13-week forecast is a practical horizon that captures the payroll and payment cycles that matter most.

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