SCAFFOLDING JOBS LOOK PROFITABLE. THE CASH IS STILL IN TRANSIT.
Scaffolding 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 scaffolding 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 scaffolding 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.
Your capital is the component fleet. The rental market publishes rule-of-thumb math: ownership wins above about 60 percent utilization, and holding cost is around 1.5 percent of purchase price a month for maintenance, insurance and storage. For a scaffold company it works in reverse. Idle inventory in the yard is capital paying holding cost, and utilization across the fleet is your core number. Component tracking (what's erected where, on whose job, since when) is inventory accounting for your fleet.
Rental revenue builds by the week the scaffold is up. The losses are paperwork: undocumented handover dates, extensions nobody rebilled, weather months at reduced rates on a handshake, and dismantle dates that moved without updating the meter. Swing stages at $1,600 to $2,000-plus a month and commercial erected packages at $5,000-plus a month are big meters to leave unread.
WHAT MOVES MARGIN IN THIS TRADE.
The Blended Quote
E&D labor, rental weeks and engineering are three revenue streams, and each one has its own costs. When the dismantle date moves, a blended price can't tell you which one lost money. Quote and cost-code all three.
The Idle Yard
Your fleet is your capital, and utilization is your P&L. Components in the yard cost you about 1.5 percent of their value a month at rental-market rates. Component tracking and a fleet utilization report are the core statements in this trade.
The Unread Meter
Erected scaffold earns by the week only if the handover, extension and off-hire dates are in writing. At commercial rates of $5,000-plus a month, an undocumented month is a check nobody cashed.
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.
SCAFFOLDING BENCHMARKS.
Scaffolding subcontractors at $1M to $5M net 8 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.
