ELEVATOR JOBS LOOK PROFITABLE. THE CASH IS STILL IN TRANSIT.
Elevator subcontractors run out of cash for reasons specific to how the work is built and billed, on jobs that are making money. The three that cost the most in this trade are below, taken from elevator contractor research. Most sit at 75 to 90 days from finishing work to holding the money, and 45 days is achievable.
Cash and profit are measured on different clocks. Your profit and loss records revenue when you invoice and costs when you incur them, while the bank account only knows what cleared. Labour goes out weekly and collects 45 to 90 days later, minus retention. That distance is what a growing, profitable elevator company funds out of pocket, and it widens as you grow. The specific things that widen it in this trade are what the rest of this page is about.
WHERE IT LEAKS OUT.
Full-maintenance pricing bets that the unit's callback rate stays below the rate priced in; aging equipment, abused door systems, and construction-debris shutdowns move the actuals. The published owner-side analysis shows the flip side (authorization delays turning one repair into three visits); the contractor-side lesson is per-unit callback tracking, because a portfolio priced flat across unit ages is subsidizing its worst cars with its best.
New installation and modernization projects ride the general contractor world: long equipment leads, hoistway-readiness dependencies (the elevator crew idles when the shaft, pit, or power isn't ready), pay apps, and retainage. The steel file's site-readiness claim discipline and the mechanical file's equipment-float mechanics both transfer.
WHAT MOVES MARGIN IN THIS TRADE.
The Annuity Underneath
Maintenance contracts at $500 to $1,200 per unit per month recur, compound, and explain the best net-profit floor in the 48-trade dataset. The operator who tracks per-unit contract P&L owns an asset; the one who doesn't owns a route.
The Proprietary Wall
OEM controllers, $10,000 diagnostic tools, and obsolescence declarations define the independent's serviceable universe, and every proprietary install shrinks it. Strategy in this trade starts with a map of what you can actually maintain.
The Flat-Priced Portfolio
Full-maintenance pricing is an actuarial bet, and a portfolio priced flat across unit ages subsidizes the worst cars with the best. Callback rates per unit, repriced at renewal, are the trade's underwriting discipline. (cfos-job-profitability-system) ---
DAYS SALES OUTSTANDING.
Ninety days is weak, 45 is the target, 30 is strong. Nothing else moves cash faster.
| Position | Days | What it means |
|---|---|---|
| Weak | 90 days | Roughly three months of work funded out of your own pocket. |
| Target | 45 days | Achievable on the days you control: submission timing, complete documentation, follow up in week two. |
| Strong | 30 days | Requires discipline every month, and it's the cheapest capital available to you. |
Moving from 90 days to 45 frees roughly annual revenue divided by 365, times 45 days. At $4M that's about $493,000. At $8M it's about $986,000. That money doesn't come from a bank and it costs no interest, which is why we work the cycle before discussing financing anything.
ELEVATOR BENCHMARKS.
Elevator subcontractors at $1M to $5M net 9 percent, against a CFOS target of 12 percent, set at 10 percent before taxes or 3.5 points better than your trade's average at your revenue, whichever is higher. Working capital should sit at 13 percent of annual revenue, and the monthly close should finish by day 10 so the numbers can still change a decision.
FREQUENTLY ASKED.
