Many Restoration Contractors spend much time focusing on trying to be profitable. They review margins, compare actual costs and look for ways to reduce their expenses. All of that is important. But there is another question that is just as important: How fast are you turning completed work into collected cash?
Jobs can look profitable on paper and still create financial problems if the process of approving, invoicing and collecting takes too long. This is becoming one of the most common challenges in the insurance restoration industry to date. Contractors are often required to finance all costs long before payment is ever received.
This means cash flow is King and just as important as hitting your gross margins. The longer a job sits unbilled or unpaid, the more pressure it puts on the business's health and ability to grow and scale. So how is technology looking to solve this problem?
Collection speed should not be treated as something that only hits the end of the job. It should be treated as an operational process that starts at the beginning with setting strong expectations.
Getting authorizations signed early, capturing proper documentation consistently throughout the job, and then reviewing job files before invoicing. Companies that collect faster are usually not just better at accounting. They are better at pushing jobs throughout the entire process.
Contractors understand that every missing photo, incomplete note, and unsigned document delays the payment process and creates friction throughout the claim life cycle. Friction that ends up slowing down billing, delays collections and creates financial hardships on the business cash flow.
Contractors should be asking questions like:
- How many days does it take us to invoice after work is completed?
- How many invoices are waiting on missing documentation?
- How much money is sitting in accounts aging over 30, 60, or 90 days?
- Who is responsible for collecting money in your organization?
Increasing your sales and keeping busy are not what solves the problem. The answer is to find ways to automate the collections process, provide strong workflow & communication tools that will provide consistent follow up throughout the entire collection process.
At PSA, we are committed to delivering #ContractorFirst solutions that empower businesses to leverage technology more effectively driving greater efficiency, accountability, and profitability.
Our solutions are purpose-built from the ground up to serve Restoration Contractors as a true ERP solution that focuses on eliminating duplication, improving documentation, and streamlining the flow of information from job intake through final collection, all in one complete package.
Interested in learning more? Contact us today: sales@canamsys.com