The challenge
The contracts were profitable. Margins were reasonable, the order book was healthy, and the annual accounts showed a business doing well. And every month the owner was deciding which suppliers to delay.
Contracting hides cash in three places at once: retention held back by clients until a project closes, advances already spent on mobilisation, and work-in-progress earned on paper but months away from being invoiceable. All three were present here, and none were visible in a P&L.
The owner was not short of financial information. He had management accounts. What he did not have was a view of what would actually arrive in the bank in the next four weeks, which is the only number that matters when payroll is due on the 25th.
How we worked through it
- Week 1
Where the cash actually was
We aged every customer balance properly, separating retention held under contract from invoices simply not chased. The two had been sitting in one number, which made the receivables ledger look like a problem nobody could solve.
- Week 2
Separating the unsolvable from the winnable
Of SAR 1.42m outstanding, SAR 512k was contractual retention not yet due — genuinely unavailable. The remaining SAR 908k was collectable, and roughly half of it was over 90 days old with no follow-up recorded against it.
- Weeks 3–4
Building the forecast
A four-week rolling cash view: committed outflows (payroll, GOSI, suppliers, rent) against realistically collectable inflows. Not a budget — a short-range forecast the owner could act on each Sunday.
- Months 2–3
The weekly call
Thirty minutes a week with the owner and the site manager. Which invoices went out, which are disputed, which client needs a call from the owner rather than an email from accounts.
Backlog / balance over the engagement
The result
SAR 480,000 of aged receivables collected within 90 days — money that already belonged to the business and was simply not being asked for.
The average collection cycle shortened by 64 days. More importantly, cash shortfalls are now visible three to four weeks ahead rather than on the morning they arrive, which turns supplier payments back into decisions.
The weekly call still runs. It has become the meeting where commercial decisions get made — which contracts to bid, which clients to tighten terms with — because it is the only forum where the numbers are current.
Profit and cash diverge most sharply in contracting, and no annual P&L will warn you. A business can be genuinely profitable and still fail on a Tuesday because a payroll ran before a retention released.
