Every pool builder has done it. A draw comes in on Job B. Job A has bills due. You move the money over.
It feels harmless. It is a loan from one customer to another, and the customer doesn't know.
How it starts
Pool contracts are paid in stages. You dig, you get a draw. You shoot the shell, you get another.
Costs don't wait for the draws. Subs and suppliers want to be paid now. So the draw you just received covers the bills you already owe.
Nobody plans it that way. It just happens one tight week at a time.
Why it fails
The money you took from Job B was meant for Job B. That job still needs its dig, its plumbing, its steel and its crew.
So now Job B is short. You cover it with the next draw from Job C. Then Job C is short.
It's a chain. It only holds while new jobs keep coming in.
- Growth makes it worse. Every new job adds more float to fund.
- A slow month breaks it. Sales dip, no new draws arrive, and the old bills are still due.
- A bad job hides inside it. A job that is losing money gets covered by the next job's cash, so you never see the loss.
Signs you're in the chain
- You check the bank balance before paying a sub.
- A draw arrives and most of it is gone within days.
- You can't say what a finished job actually cost.
- The busiest months feel the tightest.
How to get out
If you're already in it, the fix starts with a number. How big is the hole?
- List every open job. For each one, write down the draws received so far.
- Add up what each job still needs. That means bills already owed plus the cost to finish.
- Subtract. Draws received minus money spent minus money still needed. A negative number means that job is borrowing from others.
- Total the negatives. That is your gap. It's usually bigger than people expect, but now it's a number you can plan around.
- Stop adding to it. From today, a draw stays with its job until that job's bills are paid.
- Choose how to fill it. Options include a line of credit, money from the owner, slowing down new starts, or longer terms from suppliers. Pick one on purpose. Don't let the next draw pick for you.
- Talk to suppliers and your lender early. A call before you're late goes much better than a call after.
Slowing down new starts feels backwards. But every new job you start while the gap is open makes the gap bigger. Let the chain unwind first.
Keeping it from coming back
Track cash by job. Each job gets its own number: draws in, costs out.
Look ahead a few weeks. What will each job need, and will the draws cover it? If not, you find out early, not on payday.
Then look at your draw schedules on new contracts. If the draws come in after the costs go out, you are financing the customer's pool. Have a Florida attorney review any contract changes before you use them.
If one job really does need help from another, write it down as a loan and pay it back.
None of this is complicated. It just takes a clear picture of each job, and most builders don't have one.
If you'd like help building that picture, schedule a free call. You can also see what I do.