Turning over well, and nothing left at the end of it
Money comes in, money goes out, nothing stays. That single symptom has three completely different causes, and the treatments contradict each other. Underpriced means every new job makes it worse. Owed means the work is done and the money exists but is sitting with somebody else. Paying yourself last means the business is solvent and you’re not. Chasing more work fixes none of them, and makes the first two worse — which is exactly why working harder hasn’t moved this.
Take last month’s jobs. For each one, write what you charged and roughly what it cost you — materials, subcontractors, and your hours at a rate you would pay somebody else to do it. Not what you wish it cost. What it cost. If a job you were proud of comes out flat or negative once your own time is in there, you’re not busy, you’re subsidising customers. The uncomfortable part is that the jobs you like are often the worst offenders, because you don’t count your own hours on those.
Add up what has been invoiced and not paid, and how old each one is. Owners routinely discover a number that’s one to three months of their entire problem, sitting in other people’s accounts. This is the best case of the three, because nothing about the business has to change — the money already exists. It’s also the one owners avoid hardest, because chasing feels like admitting something. It isn’t. An invoice is a thing you have already paid for in labour and materials.
A lot of owners treat their own pay as whatever survives the month. That isn’t discipline, it’s a business whose costs haven’t all been counted — because your wage is a cost whether or not anybody writes it down. A business that can’t pay you is telling you something about its prices or its overheads, and the longer you absorb it personally the longer it takes to hear. Paying yourself a set amount, even a small one, is how the real number surfaces.
More volume at a price that doesn’t clear costs loses money faster. More volume from customers who pay late lends money faster. Only one of the three causes responds to more work, and it’s the one fewest owners have. This is the whole reason the year of extra effort didn’t land — the effort was real and it was aimed at the wrong thing.
Do the ten-minute job costing before anything else, because it decides everything after it. If the jobs are profitable and the money is late, the next move is collections, not sales. If the jobs aren’t profitable, no amount of collecting fixes it and the next conversation is about price. If both are fine and you’re still short, the problem is overheads or your own pay, and that’s arithmetic you can do on one page.
Only once you know which jobs are underwater, and by how much. A flat increase across everything moves the good work away along with the bad. The job costing tells you where the hole is, and usually it’s one type of work or one customer rather than the whole book.
Profitable means the business covers all its costs including a real wage for you, at a rate you would have to pay somebody else. If your own hours are free in the maths, the business isn’t profitable — it’s being funded by you, and that shows up as your empty account rather than the company’s.
That’s a real constraint and worth being honest about, but it’s also worth naming what it costs: you’re lending them money at your own expense, and the size of that loan is knowable. Knowing the number doesn’t force you to act on it — it just stops it being invisible while you wonder where the money went.
The question is whether not having one is currently costing more than one would. If you can’t answer what last month cleared, it probably is. This is general information rather than advice about your situation, and an accountant who can see your actual numbers is the right person to settle it.
Everything above is the shape of the decision. What it cannot do is use your figures. You narrow four ways out to the one that fits you, then turn it into three moves in the order they work — free, and yours to keep.
Show me which wayFree. No card, and no account to begin.
This is general information about how these decisions work, not financial, legal or tax advice. Check the numbers against your own situation before you act.