MORE WORK. BUSIER THAN EVER. SO WHERE IS THE MONEY?
Revenue growth in construction requires more mobilization capital before it produces more cash. Going from $3M to $5M means funding 67% more work in progress before collecting 67% more revenue. If the cash conversion cycle stays at 75 days and working capital doesn't grow proportionally, more revenue creates more cash stress rather than less. Each added job is funded before it's billed. The $5M year feels tighter than the $3M year because it is. You're carrying more projects, more crew, more equipment, and more material, all of it financed for 60 to 90 days before a draw comes in. The margin is there and the cash isn't, yet.
The businesses that scale through this stretch without damage all do the same three things. They plan working capital ahead of the revenue instead of behind it, they front load billing on every new job, and they run a 13-week forecast that puts the tight weeks on a calendar months in advance. None of that changes how much profit the work makes. It changes whether the profit is available when the crew needs paying. Growth consumes working capital in a predictable way, and predictable is the part most subs never take advantage of.
WHAT IT MEANS.
Revenue growth in construction is a cash outflow before it's a cash inflow, because every new project start needs mobilization capital weeks or months before the first draw comes in.
Every new project start requires mobilization capital before the first billing cycle. On a $500K project with a 45-day first draw, you're funding $80K to $120K of labor and material before any cash comes in. Add three simultaneous project starts in the same month and the mobilization demand is $250K to $360K, all of it before a single pay application gets approved.
Growth feels like success until the cash position deteriorates, and then it feels like failure. Neither read is right, because growth consumes working capital in a way that can be calculated in advance. The problem is that most subcontractors never model it before the contracts are signed.
WHY MORE WORK CREATES MORE CASH STRESS.
Growth outpaced working capital
The business took on more work than the cash position could support. Every new project start is a cash outflow before it's a cash inflow, and three of them in a month stack on top of each other. Without adequate working capital or a credit facility behind it, growth creates cash stress that reads like a failing business from the inside, even while every job on the board is profitable.
Overhead grew with revenue but margin didn't
The business added staff, equipment, and overhead to carry the growth, and project margin didn't rise at the same rate. Revenue is up and overhead is up by the same percentage, so net profit is flat or shrinking on a bigger top line. That's the flavor of this problem that survives a cash fix, because the arithmetic is broken rather than the timing.
The new work is lower margin
Bigger projects, volume chasing, and work accepted below the minimum margin threshold to keep crews busy all do the same thing. Revenue grows while margin per dollar of revenue shrinks, so there's more work and less money per dollar of that work. The revenue number in the year end summary looks like the best year the company ever had.
WHAT IT LOOKS LIKE IN DOLLARS.
Going from $3M to $5M means funding 67% more work in progress before collecting 67% more revenue. The average wait for the first draw on a new project is 45 days, and three simultaneous starts can create $360K of mobilization demand in one month. On a single $500K project with a 45-day first draw, the funding requirement is $80K to $120K of labor and material before any cash comes in.
Working capital should be at least 10 to 15% of annual revenue, so a $5M subcontractor should hold $500K to $750K available between cash and an undrawn line of credit. The CFOS target is $650K in the bank at all times plus a $1.2M credit facility available for growth. That reserve carries mobilization demand on several simultaneous starts without cash stress.
A verified civil client now at $7.1M grew from $500K in year one to $5M in year two and was three weeks from losing his house. The growth was genuine and the cash management hadn't caught up to it. SPM rebuilt the billing and collections process, built the forecast, and cleared two maxed LOCs and an SBA loan in 90 days.
WHAT GOES IN PLACE BEFORE THE NEXT AWARD.
Know how much cash the job needs before you commit to it. The calculation takes twenty minutes and it turns a signature into a decision. Three awards in one month is a different question from one award, and the model is what tells you which one you're looking at.
Bill mobilization, submittals, and early phases aggressively from day one. The SOV is a negotiation at contract execution, and front loading it's a defensible position rather than a favor. Every week of billing pulled forward is a week the LOC doesn't carry.
Below the threshold, the job requires explicit approval instead of an estimator's judgment call under deadline. That one rule is what stops volume chasing from resetting the company's margin by degrees. The threshold gets set from your own trailing numbers and not from a benchmark table.
Banks lend to growing businesses and they don't lend to businesses in crisis. The facility you can get in a strong quarter isn't the facility you can get in a tight one. Arrange the credit during the growth, not after it turns into a problem.
Model the cash demand before the project starts rather than after the mobilization invoices come in. An award is a cash event with a date on it, and the forecast is where that date lives. This is a fifteen minute update that changes which contracts get signed.
FLAT MONTHLY FEE. NO SURPRISES.
Three tiers, priced by your trailing twelve month revenue. Which one you're in depends on how much of the work you want off your desk. No hourly billing, no payroll, and no add-ons.
Pricing
| Last 12 months revenue | Monthly fee |
|---|---|
| Up to $1M | $1,900 to $2,900 |
| $1M to $3.5M | $2,600 to $3,900 |
| $3.5M to $6.5M | $3,800 to $5,700 |
| $6.5M to $9.5M | $5,100 to $7,100 |
| $9.5M to $12.5M | $6,100 to $8,500 |
| $12.5M to $15.5M | $7,400 to $11,000 |
| $15.5M to $18.5M | $9,400 to $13,500 |
| $18.5M+ | Quoted individually |
Range reflects the three tiers below. Which one you're in depends on how much of the work you want off your desk. No payroll. No hidden line items.
You stop guessing.
You get the CFO work. Job costing built against the way you estimate, a 13 week cash forecast, monthly WIP, and a meeting every month that ends in decisions rather than a report.
Your bookkeeper keeps doing the books.
You stop touching the books.
Everything in Core, and we run the bookkeeping and the controllership as well. Nobody in your office is answering coding questions or chasing a reconciliation at month end.
We do the books. No payroll.
Every job shows its margin while it's still running.
Everything in Executive, plus the job costing and WIP platform set up, loaded with your cost codes, and managed for you every month. You never have to learn it.
We do the job costing.
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