A measure of how long a company takes to pay its invoices after receiving them. For subcontractors, a high DPO from your client means slower payment and tighter cash flow. Tracking client DPO helps you anticipate payment delays and manage operating costs.
DPO (Days Payable Outstanding)
Related Terms
Fixed-Price Contract
Cash FlowA contract where the subcontractor agrees to complete a defined scope of work for a set price regardless of actual labour, equipment, or material costs incurred — meaning cost overruns come directly out of your margin. Unlike time-and-material agreements, these contracts reward efficiency but expose field service companies to significant financial risk if scope creep or unforeseen site conditions arise.
Fuel Surcharge
Cash FlowA variable fee added to invoices to offset rising fuel costs for equipment, vehicles, and machinery. Rates are typically tied to a published fuel index and adjusted weekly or monthly. Subcontractors should confirm surcharge terms in their master service agreements before mobilising.
Estimating Backlog
Cash FlowThe 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.
CAPE (Consolidated Administration and Processing of Entries)
Cash FlowA 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.
Backlog
Cash FlowThe total value of contracted work that has been awarded but not yet completed. A healthy backlog signals steady upcoming revenue and helps subcontractors plan crew deployment and equipment needs. Thin backlogs often signal the need to ramp up bidding activity.
Pay-When-Paid
Cash FlowA contract clause where a general contractor delays paying subcontractors until the owner pays them first. This shifts financial risk downstream to subcontractors and field service companies. Review these clauses carefully, as they can significantly impact your cash flow on long projects.
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