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Cash Flow Glossary Term

Cost-Plus

A contract where the client reimburses your actual costs and pays an additional agreed percentage or fee on top. Common in complex field projects where scope is hard to define upfront. Subcontractors must track and document all expenses carefully to get paid accurately.

Related Terms

Rescheduling

Cash Flow

Rescheduling occurs when a client moves a confirmed job to a new date, disrupting crew and equipment plans. Subcontractors should have rescheduling clauses in contracts to recover standby costs. Repeated rescheduling without compensation can seriously damage a small operator's cash flow.

CAPE (Consolidated Administration and Processing of Entries)

Cash Flow

A centralised system used by operators to consolidate and process contractor timesheets, work records, and billing entries. Subcontractors submit field data through CAPE to trigger payment and compliance verification. Accurate, timely entries are critical to avoiding payment delays.

Early Payment Discount

Cash Flow

A reduced invoice amount offered to prime contractors or clients who pay before the standard due date. Common terms like 2/10 Net 30 mean a 2% discount if paid within 10 days. Subcontractors must weigh the cash-flow benefit against the revenue they give up.

Breakeven Cost

Cash Flow

The minimum amount a subcontractor must charge to cover all project expenses without making a loss. It includes labour, equipment, fuel, insurance, and overhead. Pricing below breakeven erodes margins and can threaten business viability.

Estimating Backlog

Cash Flow

The queue of pending bids and quotes a subcontractor has not yet completed or submitted to clients. A large estimating backlog can delay securing new work and strain small estimating teams. Tracking it helps prioritise high-value opportunities and allocate quoting resources effectively.

Construction Input Costs

Cash Flow

The direct costs subcontractors pay to deliver field work, including labour, materials, fuel, and equipment. These costs fluctuate with market conditions, directly squeezing margins if contracts aren't priced accordingly. Tracking them closely helps subcontractors identify when to renegotiate rates or escalation clauses.

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