Insights: Corporate Finance and Capital
Debt and equity placed on terms that fit the business, from lenders who are not all the same.
The Working Capital Gap Most Business Owners Miss
The difference between AR factoring and an MCA is not just price. It is fit. Using the wrong instrument can cost you more than the problem you were solving.
The Money You've Already Earned
Two things drain cash out of electrical contractors in ways the P&L is slow to show: change-order work done before it's approved, and public work that pays reliably but late.
The Off-Season Is Where Landscaping Balance Sheets Break
Three-quarters of the year's revenue arrives in 7 months. Every fixed payment arrives in twelve. The equipment note signed in July gets paid in a February with no deposits behind it, and that is where profitable companies run out of cash.
You Are Already a Lender
Every invoice you send on 30 or 60 day terms is a loan you made to your customer at zero percent. Before you finance that gap, look at whether you created it.
The Note Doesn't Care How Many Hours You Ran
Dealer financing is sold on the monthly payment and the tax write-off. Neither one tells you whether the machine earns its keep. Utilization does, and it's the number the sales sheet leaves off.
Your Bonding Capacity Is a Math Problem
The surety reads your work-in-progress schedule, not your charm. How you bill decides your working capital, and working capital decides how much work you are allowed to chase.
The Payment Was Sized to a Rate You Don't Track
The dealer built the monthly payment around an assumption about how many hours the machine would run. You never measured whether it hit that number. The gap between the two is where machine shops get squeezed.
The Ceiling That's Really a Financing Problem
The order you turned away last quarter probably wasn't beyond your capacity. It was beyond a payment schedule the dealer wrote to sell a machine, not to fit your business.
The Second Advance Is the Dangerous One
One merchant cash advance is a decision. The second one, taken to make payments on the first, is the start of a countdown most owners do not know they have begun.
The Debt You Signed For a Practice You No Longer Run
The equipment and buildout loans you took to open the doors were sized for a practice that no longer exists. Meanwhile a chunk of your revenue behaves like retail and gets financed like neither medicine nor a store.
The Cash Year and the Calendar Year
Replacement work ties up your money before the customer pays, and the bill comes due in your slowest quarter. Healthy HVAC shops get caught by timing, not by margin.
Every New Client Is a Loan You Fund Before the First Invoice Clears
Your workers get paid Friday. Your client pays in 7 weeks. Between those 2 dates you are the bank, and the faster you grow the deeper the gap runs. Know what your money costs before you rent someone else's.
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