MARINE JOBS LOOK PROFITABLE. THE CASH IS STILL IN TRANSIT.
Marine subcontractors have no cash left 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 marine contractor research. Most are 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 marine 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.
Most dredge and in-water work needs USACE Section 404 and state Section 401 permits, plus NOAA and habitat consultations. Environmental windows (fish spawning, bird nesting, turbidity limits) decide when the spread can work at all. Permit timing is schedule timing, and schedule timing is cash timing.
Marine subs on federal and port work are under primes on Corps contracts. They have Miller Act payment-bond rights in place of liens, flow-down clauses and certified payroll. That adds a payment step and paperwork most dirt contractors never see.
Getting a spread to the site (tug transit, permits for the tow, crane rigging, spud setup) costs six figures on real jobs, and demob is its own line. Marine needs separate SOV billing for mobilization more than any trade on the site.
WHAT MOVES MARGIN IN THIS TRADE.
The Spread That Never Sleeps
Barges, cranes and tugs bill by the day, good weather or bad. That's why marine overhead is 15 percent at the small end. Spread-day rates and weather-standby cost codes are your equipment utilization, at ten times the stakes.
The Window
USACE permits, environmental windows and tide tables decide when the work happens. You decide only whether the cash plan matches. Competition in the peak window can move bids 10 to 25 percent.
The Sub-Tier Maze
Under a prime on federal or port work, lien rights become Miller Act bond rights, the deadlines change and flow-downs govern. A $25M marine GC works on systems, because at marine scale the paperwork is the cash.
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 | You can get here on the days you control. Bill on time, send complete paperwork, and follow up in week two. |
| Strong | 30 days | Takes work every month. It's the cheapest money you can get. |
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 costs no interest and needs no bank. So we fix billing and collections before we talk about financing.
MARINE BENCHMARKS.
Marine subcontractors at $1M to $5M net 7 percent, against the CFOS net profit target, set at your trade's net profit average at your revenue plus 3.5 points, never below 10 percent, before taxes. The working capital target is 13 percent of annual revenue, and the monthly close should finish by day 10 so the numbers can still change a decision.
FREQUENTLY ASKED.
