Cash Flow Crunch
Most project directors don’t lose sleep over profitability – until payments dry up. By then, the damage is already baked in. Projects rarely collapse because of design flaws or material shortages. They fail because cash flow does.
Where’s the biggest drain?
Late or incomplete applications for payment.
Subcontractor invoices that aren’t tracked against value earned.
Poor forecasting that ignores retention, inflation, or extended payment terms.
Disputes clogging up cash in claims and counterclaims.
What’s the Root Cause?
Many businesses treat cash flow as an afterthought – a finance function, not a delivery priority. In reality, it’s the lifeline of every project. Poor systems, siloed data, and reactive management mean businesses don’t see the problem until they’re already in arrears.
A real-world example:
One contractor we worked with had £2.5m locked in unpaid variations. Not because clients were refusing to pay – but because notices weren’t issued properly, leaving invoices unenforceable.
Control Creates Confidence
The best commercial teams put cash flow at the centre of delivery. They use:
Live forecasting tools, not static spreadsheets.
Automated reminders for payment notices and deadlines.
Clear reconciliation between subcontractor payments and project value earned.
Early warning systems for client-side disputes.
Final Thought
Cash doesn’t just keep the lights on – it keeps projects alive. If you want projects to succeed, cash flow isn’t a finance problem. It’s a management problem.
