A contractor can have a full order book and still be unable to meet payroll. That is not a contradiction. Construction cash is tied to when work is certified, whether a pay-less notice has been issued, and how much of the value is locked in retention.
Start with the application pack, not the accounts
Year-end accounts will not tell you whether next week's labour can be paid. Directors need a contract-by-contract view: applied, certified, paid, retained, disputed and still to complete.
Once that exists, the board can see whether the problem is slow paying customers, under-priced work, overhead, or a single employer or main contractor that now represents too much of the book. Our construction cash flow support is built around that review.
Retentions are value, not a cash reserve
Retentions can be a material asset, but they are a poor emergency fund. Release dates slip, snagging disputes arise, and if the payer becomes insolvent the retention may be much harder to recover.
Confidential Board Advisory
Facing this situation in your business?
Speak with a Turnwell commercial adviser. We help directors understand their options, protect value, and preserve legal compliance before taking action.
A turnaround plan that assumes retentions will arrive in time to fund current jobs is usually too optimistic. Treat them as uncertain receipts unless the paperwork and the payer's position say otherwise.
Late payment and HMRC often arrive together
When certificates slow down, VAT and PAYE are often the next payments to slip. That is why construction cash work should be read alongside construction HMRC debt rather than as a separate operational issue.
If a main contractor has failed, or suppliers have stopped the account, see creditor pressure in construction. For companies outside the built environment, the equivalent starting point is the general cash flow page.
