TILE & STONE JOBS LOOK PROFITABLE. THE BALANCE SHEET IS STILL THIN.
Tile & Stone 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 tile & stone 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 tile & stone 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.
Stone and specialty tile are deposit-heavy, long-lead, and often imported: fabricated countertop slabs, book-matched stone, and special-order tile tie up five figures between deposit and install, with breakage and dye-lot risk riding along. The flooring cluster's material-float story applies with harder edges: a cracked slab or a short dye lot isn't restocked from a warehouse.
Tile finishes late, and the painting file's math transfers: a 5-to-10 percent hold against a 5.5 percent net floor means the retainage exceeds the profit. Punch scrutiny on visible finish work (grout shade, lippage claims under raking light) gives closeout pressure extra teeth; the drywall cluster's lighting-standard discipline is the cousin argument.
WHAT MOVES MARGIN IN THIS TRADE.
The Inherited Slab
Tile is rigid; the substrate's sins (out-of-flat, wet, cracked) become the tile contractor's callbacks unless substrate acceptance, prep pricing, and test records are on paper before setting. Request the FF/FL report and the moisture readings at handoff; they exist for exactly this.
The Slab on the Boat
Deposits out months early, breakage and dye-lot risk in transit, no warehouse restock behind a cracked book-match: the material float is the trade's silent bank loan, and stored-materials terms plus priced attrition allowances are the repayment plan.
The Flood Test Nobody Billed
Wet areas fail at the membrane, and the bill lands on whoever lacks the test record. A witnessed, photographed, billed flood test before setting is cheap insurance against the most expensive tear-out in the interiors family. (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.
TILE & STONE BENCHMARKS.
Tile & Stone subcontractors at $1M to $5M net 8 percent, against a CFOS target of 10 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.
