The contract can be a win and still create a cash problem.
The customer signed. Materials must be ordered this week. Payroll runs Friday. The first invoice cannot be submitted until a milestone is complete—and the customer still has payment terms after that.
What must the business spend before it earns the right to invoice?
01
Award is not cash
A signed contract creates work and expected revenue, not immediate liquidity. Build the timeline from mobilization through performance, invoice approval, and payment.
02
Margin must survive the structure
Estimate contract gross profit, additional overhead, delay risk, and financing cost. A large contract is not automatically a good borrowing decision.
03
Reduce the gap where possible
Customer deposits, milestone billing, supplier terms, phased purchasing, and scope sequencing can sometimes lower the amount or duration of outside capital.
Sources and further reading
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