Construction cash flow is a timing problem: a general contractor may owe crews and suppliers before a client payment arrives. The practical fix is to forecast cash by week, connect each invoice to documented contract terms and completed work, and act on a shortfall before it becomes a missed payment. Software can make the records easier to see; it cannot make an unearned draw payable or guarantee collection.

Build a weekly cash forecast from real jobs

Start with the cash actually available to the business. For each of the next 8–13 weeks, list payroll, subcontractor commitments, material deliveries, taxes, rent, debt payments, and other known outflows by expected payment date. List incoming cash separately, using a realistic collection date rather than the date an invoice is sent. Keep signed, billable work distinct from an unsigned change order or a proposed job.

For each week, calculate opening cash + expected collections − committed payments = projected closing cash. Also run a delayed-payment version: what happens if the largest expected draw arrives two weeks late? The gap between the two versions shows how much timing risk the business is carrying. These are planning scenarios, not promises that a client will pay on either date.

For example, a week starting with $12,000, expecting $5,000 in collected payments, and owing $9,000 ends at a projected $8,000. If the $5,000 collection slips, the projection falls to $3,000. The numbers are hypothetical; use your own contract, bank, payables, and collection history. The U.S. Small Business Administration's business planning guidance includes cash-flow statements among the financial records used to understand a business.

Know when a draw is actually due

Write a payment schedule into the contract that identifies the work or delivered materials behind each progress payment. Keep a record of the milestone, approval, invoice, and receipt in one place. Check the governing contract and state rules before invoicing. A software reminder should follow a valid invoice and agreed terms; it should not create a new payment right.

California home-improvement work has specific limits. The Contractors State License Board says the down payment cannot exceed $1,000 or 10% of the contract price, whichever is less. Later payments cannot exceed the value of work performed or materials delivered. Its guidance also calls for a detailed written payment schedule and signed written change orders before changed work. See CSLB's home-improvement contract rules and the related GC draw-schedule guide. Requirements vary by job and jurisdiction, so have your contract reviewed for the work you actually perform.

Find the controllable delays

  1. Milestone evidence: record the completed scope, delivery, inspection, or client approval the contract requires. An inspection delay and a billing delay are different problems; track them separately.
  2. Invoice preparation: compare the proposed invoice with the contract schedule and supporting records before sending it. Record when it was sent and when payment is contractually due.
  3. Change orders: document scope, price, and schedule effects and obtain required signatures before performing changed work. Keep unsigned work out of the reliable-collections column of your forecast.
  4. Receivables follow-up: review unpaid invoices by due date, ask whether there is a documentation or scope dispute, and use reminders that match the contract and the customer relationship.
  5. Upcoming obligations: compare supplier and subcontractor due dates with realistic collection dates. Discuss financing or payment-term decisions with your accountant or lender; borrowing changes costs and risk.

Test software on one real job

Bring a current job's signed payment schedule, one approved change order, one disputed or late invoice, and next month's payables to each vendor demo. Ask the vendor to show how the same information moves from job record to draw, invoice, outstanding-balance view, and forecast export. Verify who must approve each step and which actions, if any, happen automatically. Test the exact plan you would buy and confirm what your accounting system remains responsible for.

Opsite is the publisher of this guide and one of the products you may evaluate. Its construction workflows can be considered in that same sample-job test; this article is not independent product testing, a collection guarantee, or a substitute for accounting or legal advice. Compare alternatives in the AI contractor software guide, record your findings in the three-vendor scorecard, and request an Opsite contractor workflow review if the draw and billing path fits your jobs.

Questions GCs ask about cash flow

How much cash reserve should a GC keep?

There is no universal amount that fits every contractor. Use your forecast to measure payroll and supplier obligations during plausible collection delays, then review the reserve and financing plan with a qualified financial adviser.

Will invoicing software solve a cash shortfall?

It can help a team find missing documentation, send eligible invoices promptly, and see overdue amounts. It does not replace contract compliance, client payment, or enough working capital to carry the job.

Should I move more money into earlier draws?

Only if the proposed schedule follows the contract and applicable law. For California home-improvement work, progress payments must track completed work or delivered materials; an oversized advance is not a cash-flow tactic.