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The Balance Sheet Contractors Ignore
The Balance Sheet Contractors Ignore
Most contractors obsess over revenue and job profit.
Few review their balance sheet monthly.
That’s a mistake.
Your income statement tells you if you made money.Your balance sheet tells you if you’re building wealth.
It answers one question:What do you own, and what do you owe?
For construction companies, this includes:• Cash• Accounts receivable• Work in progress• Equipment• Payables• Debt• Payroll tax liabilities
Red flags I see often:🚩 Large receivables over 90 days🚩 Growing payables but flat cash🚩 Heavy equipment debt with weak margins🚩 Negative equity
If you’ve been in business 10 years and equity hasn’t grown, you’ve been working hard — but not building wealth.
Growth without balance sheet strength just magnifies problems.
Revenue is loud.The balance sheet is quiet.
But the quiet report usually tells the truth.
