The green doesn't lie. You know why.
You can explain a slow month. You can explain a crew problem. You can explain the margin.
You can't explain a handicap that went from 12 to 19.
Whatever took your game is taking something bigger than a Saturday. You've felt it for a while. Nobody has said it out loud.
Quick check: are you spinning your numbers?
- Has a big sales month ever left you short on payroll?
- Do you look at your P&L less than once a month?
- Is there finished work sitting unbilled right now?
- Has a tax bill ever caught you off guard?
- Do you have a story ready when someone asks how the numbers look?
Two or more yeses? Time to look at the numbers without the story.
The numbers we spin
Every owner has a story for their numbers. "Sales were up." "That job ran long." "We'll catch up next month." Some of those stories are true. Some are how we avoid looking.
Your handicap doesn't take excuses. Your business numbers shouldn't either.
Here are the ones most owners spin.
Sold vs. collected
Sold is the work you booked. Collected is the money that actually landed. In a lot of service businesses those can live weeks apart. You pay your people and your bills now. You get paid later. That's why your best sales month can leave the bank account tight.
Profit vs. cash
Your accountant says you made money. So where is it? Profit is a score on paper. Cash is what pays the bills. Profit can hide in money owed to you, work that's finished but not billed, equipment, loan payments and taxes. You can be profitable and still run short of cash.
Done but not billed
This is where a lot of owners quietly bleed. Finished work that hasn't been invoiced is money you already spent and haven't asked for.
I lived this one. In my 27 years owning and running a SERVPRO franchise, there was a stretch where the business carried about $600,000 in debt, plus another $340,000 of personal debt. It took me roughly ten years of fixing wrong decisions, mine included, to dig out to zero. I'd rather you see it in a 30-minute walk than in a ten-year climb.
Three numbers to look at every week
- Cash in the bank today, and what has to go out in the next 14 days.
- Money owed to you, sorted by how old it is.
- Work done but not yet billed.
Look at them every week, out loud, with no stories attached. That's how you stop spinning.
Questions owners ask
Why is cash tight when sales are up?
Because you pay costs now and get paid later. More sales means more cash fronted before the money comes in.
Is my P&L wrong?
No. It just shows profit, not timing. You need both.
What should I fix first?
Work that's done but not billed. It's usually the fastest cash you can bring in.
One question to sit with
If an extra $100K a year in profit was leaking out of your business, and you could plug it, what would you do with your Saturdays?
If you want to say it out loud with someone who's been there, let's walk your business together. Thirty minutes, you and me.
Not ready to talk yet? Get the 5 places $100K hides in a service business, with a 2-minute check for each one.
Pete Ambrosino, Ambrosino Strategic Advisors. Advisor to owners of restoration and service businesses. 27 years owning and running a SERVPRO franchise. Advising business owners since 2015.
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