Cash flow is an extremely hot topic for any type of business. A few weeks ago, I bumped into a friend of mine who is the controller for a local construction firm. While talking, I asked her to name the single biggest issue she's facing. Without hesitating, she said, "Cash flow."
For most industries, there is risk but predictability in cash flow. This is less true for construction. Contractors face an environment in which not only is risk present (and these days quite high), but it is much harder to predict and control. Over the next few days, we'll take a look at some of the elements that make it difficult to manage construction cash flow starting with estimating and income verses outgo.