Getting paid faster on commercial electrical work

The work is finished. The invoice went out. The terms said thirty days and it has been seventy. Meanwhile you have already paid for the material and paid your crew, twice.

That gap is where electrical contractors get into trouble. Not because the work was unprofitable, but because being owed money and having money are different things, and only one of them makes payroll.

You cannot chase what you cannot see

Most contractors we take on have no aged receivables report. They have a general sense of who is slow and a specific memory of whoever annoyed them most recently.

An aged receivables report lists every unpaid invoice grouped by how overdue it is — current, 1–30 days, 31–60, 61–90, over 90. It takes a moment to produce from books that are properly maintained, and it changes the conversation entirely, because "you are at sixty-three days on invoice 1184" is a different call from "you still owe me".

This should land in front of you every month without asking. If it does not, your books are not doing their job.

Why thirty days becomes seventy

Rarely because the customer decided not to pay. Usually one of these:

The invoice never reached the right person. Sent to the site contact rather than accounts payable, where it sits in an inbox nobody processes.

A purchase order number is missing. Many commercial customers will not process an invoice without one, and they will not ring to tell you. It simply waits.

The pay-when-paid clause. The GC pays you when the owner pays them. Worth knowing before you sign, because it makes their cash flow problem yours.

Retainage. A percentage held until completion, sometimes for months after your part is done. If your books do not track retainage separately, you are carrying money you have effectively forgotten about.

Nobody followed up. The most common reason of all. The invoice went out and then everyone got busy.

The process changes that actually work

Invoice the day the work completes. Not at month end. Every day between finishing and invoicing is a day added to the front of the payment clock, and it is the cheapest time you will ever save.

Get the PO number before you start. Not when the invoice bounces. Ask during scheduling and record it against the job.

Confirm where invoices go. Ask each commercial customer for the accounts payable email specifically. Send there, copy your site contact.

Ring at day seven, not day thirty-one. A short, friendly call to confirm the invoice was received and is in the system catches every one of the process failures above while it is still easy to fix. It is not chasing — it is confirming, and it works remarkably well.

Escalate on a schedule, not on mood. Day 30 a reminder. Day 45 a call to AP. Day 60 a conversation with your contact about what is holding it. Consistency is what makes it feel like process rather than conflict.

Track material exposure alongside it

Electrical carries a second cash problem that compounds the first: on fixed-bid work, material price movement comes straight out of your margin and it leaves quietly.

If you bid a job three months ago and copper moved, you absorbed it. Tracking material cost against what you bid, month over month, is what makes that visible while you can still reprice future work.

Combine the two and you have the picture that matters: what you are owed, and whether the work you are owed for is still worth what you thought.

What good looks like

Every month: an aged receivables report with anything over sixty days flagged, retainage tracked separately so you know what is held and when it is due, and material cost against bid on your fixed-price work.

Three reports. Together they answer whether your business is actually converting work into money, which is a different question from whether you are busy.

Related

• Job costing for contractors
• Cash basis vs accrual accounting for contractors — receivables are the main reason this question comes up
• Electrical contractor bookkeeping