You billed $200K last month. Where is it?

You Billed Like Crazy. So Why Is Your Account Empty?

March and April are your busiest months. Every crew is running. You're closing jobs faster than you can write invoices.

You billed $200,000 last month. Maybe more.

But when you check your bank account this morning, it looks like February. Payroll is due Friday and you're wondering where the money went.

Here's where it went. Nowhere. It's still sitting in receivables. You billed it, but you didn't collect it.

Revenue without collections is just paperwork. And spring makes the problem impossible to ignore.

The Collections Gap Most Contractors Miss

Contractors track revenue obsessively. Every landscaper knows their monthly sales number down to the dollar.

But most have no idea how much is actually collectible this month versus stuck in receivables waiting on payment terms that give customers 30 days to pay. Terms that often stretch to 60 days or more.

The numbers are worse than you think. According to a study by Rabbet, 82% of contractors now wait over 30 days to get paid, up from 49% just two years ago. Separate research found that 70% of contractors face payment delays on a regular basis.

For landscaping specifically, the pattern looks like this. You invoice on the 30th. About 25% of customers pay by the 15th of the next month. Another 55% pay by the 30th. The remaining 20% drags into the following month.

That means if you billed $100,000 in March, you might collect $25,000 in early April, $55,000 by the end of April, and $20,000 won't hit until May or later.

Meanwhile, payroll is due every week. Materials get paid on delivery. Fuel cards don't wait 60 days.

Revenue Hides the Problem Until It Doesn't

Here's the part nobody warns you about. The bigger your revenue, the bigger your receivables problem.

A contractor doing $100,000 per month with typical payment terms has roughly $100,000 to $150,000 tied up in receivables at any given time. That's money you earned but can't touch.

When you're growing fast, it gets worse. You add another crew, take on bigger projects, expand service. Revenue jumps from $100,000 to $200,000 per month.

Great, right? Except now you have $200,000 to $300,000 stuck in receivables. You doubled your revenue and doubled the cash gap at the same time.

Spring amplifies this because volume spikes faster than usual. You go from three active jobs to twelve. Invoicing doubles. But payment terms stay the same.

You're billing like crazy. Growing like crazy. And somehow more cash-strapped than you were in the slow season.

The issue isn't profitability. It's liquidity. And most contractors don't realize they have a collections problem until they can't make payroll.

What to Do About It

The fix isn't complicated. It just requires treating collections like the job it is.

First, know your number. Calculate how much is sitting in receivables right now. Then calculate your average days to collect. Take your total receivables, divide by your average monthly revenue, and multiply by 30. If the answer is over 45 days, you have a collections problem.

Second, tighten your terms. Require deposits on jobs over $5,000. Invoice maintenance at the start of the month, not after service. Offer a 2% discount for payment within 10 days.

Third, follow up fast. Any invoice over 30 days gets a phone call. Over 45 days gets a second call and a payment plan offer. Over 60 days stops all new work until the balance clears.

Fourth, make it easy to pay. Accept credit cards and ACH transfers. The faster money can move, the faster it will.

The goal is simple. Shrink the gap between when you bill and when you collect. Every day you cut off your average collection time is cash back in your account.

The Real Measure of a Healthy Business

You didn't start a landscaping company to chase invoices. You started it to do great work and build something that lasts.

But revenue growth without cash flow discipline doesn't build anything. It just creates a bigger gap between what the P&L says you made and what's actually in the bank.

The difference between a $1 million landscaper who's always scrambling and a $1 million landscaper who sleeps well at night isn't revenue. It's how fast they collect it.

Spring is busy. Make sure the money you're billing this month actually shows up before summer.