Accounts receivable can easily do you in. But the good news is, it's one of the easiest problems to solve.
The biggest barrier to profitability in most contracting companies today can be described in two words: accounts receivable.
In my experience of consulting with fellow plumbing contractors, it's not uncommon to see businesses with accounts receivable doubling or even tripling monthly revenue. These businesses constantly fight against deadly currents of negative cash flow, struggling to keep their heads above water, in danger of going under any month. Cash flow becomes so tight in these businesses that owners borrow money to meet payroll or routinely skip taking a paycheck for themselves and their family.