It’s time for a reality check. Every restoration business—no matter how big or small—lives and dies by its cash flow. Positive cash flow keeps your operation moving, your team growing, and your dreams alive.
But here’s the deal: You can be delivering incredible work and have customers who rave about you, but if your cash flow is out of control, you’re always going to feel like you’re one step away from disaster.
You don’t want that, and neither do I.
I’m here to help you stop this cycle of chasing down payments; living paycheck to paycheck in your business; and constantly worrying about whether there’s enough cash to cover your next move. I want you to be in control of your destiny, and doing so starts by mastering your cash flow like the business champion you are.
Whether you’re looking to expand, innovate, or simply get some peace of mind, leveling up your business all starts with understanding and optimizing your cash flow.
So, are you ready to take charge? Let’s start with why cash flow really matters and then get into 6 game-changing receivable strategies for cash flow mastery.
Your receivables team won’t be able to thank you enough.
The Power of Cash Flow: Why It’s Restoration Business Superpower
First things first: Let’s take a moment to understand why mastering your cash flow is non-negotiable. Otherwise, you’ll never take the time to improve it.
(Trust me on this. We’ve seen it repeatedly across decades consulting fellow business owners.)
Here’s three reasons positive cash flow matters:
1. Liquidity Equals Freedom
Cash flow is about having the liquid resources you need to cover day-to-day expenses—payroll, rent, supplies, and anything else that keeps your business running. When you have all of that covered, you’re able to make moves when the time is right. And by making moves, I mean taking risks to expand your business. This is the type of financial freedom you want.
2. Resilience During Tough Times
The restoration industry is no stranger to seasonal fluctuations or unexpected challenges. Positive cash flow creates a safety net, ensuring you have the resources to weather slow periods or take on emergency projects.
Even when disaster strikes your customers, you and your business can continue to function confidently, knowing you have a built-in stability that few do. Your fortunes don’t need to (and frankly, shouldn’t) be tied to the financial savvy of your customers. Instead, manage your own money and control your business’ destiny.
3. Flexibility to Innovate
When you’re not stressed about covering basic expenses, you can focus on growth and innovation. Positive cash flow empowers you to invest in new technologies, tools, and training for your team. Want to stay ahead of the competition? Cover your basics first. And that’s what we’re covering here.
With transformed cash flow, you’ll have the latitude to experiment with new services, marketing strategies, or operational improvements without fear of financial strain.
Sound like the kind of business you’d like to run? Agreed. Let’s explore new steps to take in your receivables strategy for consistent, positive cash flow.
6 Game-Changing Strategies for Your Receivables Department
These six strategies are designed to help you manage your receivables, get paid faster, and make sure cash is moving in the right direction. Implement these and set your restoration business up for long-term success.
Strategy #1: Set Clear Payment Terms from Day One
While setting clear payment terms might seem like a no-brainer, you’d be surprised by the number of business owners who never take the time to lay out their organization’s payment terms. Lay them out, lock in success. It’s an investment in your financial future that’ll pay off tenfold.
Here’s three next steps to get you started:
Define Your Terms:
Spell out your payment terms in every contract, invoice, and communication. Use clear language like “Net 30,” meaning the payment is due within 30 days, or even Net 15 if you need faster cash flow. The more specific you are, the less room there is for customer misunderstanding or delay.
Beyond that, make sure that your customers understand your terms and have them sign a detailed agreement confirming so and likewise agreeing to any additional late payments or penalties, should they not follow said terms.
This 1-2 for clear terms will change your cash flow patterns immensely. Give it a try and see for yourself.
Communicate Expectations Upfront:
Don’t wait until the end of a project to spring payment expectations on your customers. Review payment terms at the start of every project. If you lay the groundwork early, it becomes easier to collect later.
AR Pro Tip: When you kick off a project, have an onboarding meeting in which you discuss the scope of the project, your payment terms, and expectations of the project to ensure that everyone is aligned and shares an understanding of the project.
As always, get the shared understanding in writing and check in concerning payment deadlines preemptively, day-of, and after if need be.
Charge Late Fees:
Lastly, don’t be afraid to enforce late fees. You deserve to be paid on time. Late fees encourage prompt payment and send a message that you take your cash flow seriously.
AR Pro Tip: Remember: you’re running a restoration business, not a charity. Ask for what you’re owed and don’t be afraid to enforce your policies.
You’ll find your own style and set of policies. That said, here’s two examples of
what a late fee structure can look like:
A flat fee of $50 if payment is not received within 10 days after the due date.
An interest-based late fee of 1.5% per month (or 18% annually) on the outstanding balance, starting the day after the payment is due. For example, if a customer owes $10,000 and doesn’t pay on time, the late fee would be $150 for the first month overdue.
Strategy #2. Streamline Your Invoicing Process
The faster you invoice customers, the faster you get paid. Don’t delay on sending invoices—every day you wait is a day that cash isn’t in your bank accounts. Here’s some tips to accelerate your invoicing:
Streamline Invoice Timing:
Send invoices as soon as the work is completed. Don’t wait a week (or a month) to send an invoice. Prompt invoicing means you’re at the top of your customer’s mind—and that means faster payment.
Beyond that, create a company standard that you expect your AR to follow. That way, everyone’s moving at the same speed and that speed is more quickly.
Make Invoices Clear and Detailed:
Confusion is the enemy of timely payments. Make sure your invoices are crystal clear, detailing exactly what services were provided, how much is due, when it’s due, and how to pay. The easier it is to understand, the faster you’ll get paid.
Offer Payment Options on the Invoice:
Make it convenient for customers to pay you. Embed payment options in your invoice with hyperlinks to your payment portal. Beyond that, offer multiple options like credit cards, ACH transfers, or other online merchants. The less friction there is, the faster the money comes in.
Strategy #3. Get Proactive with Your Collections Process
Most restoration businesses make a critical mistake—they’re too passive about collecting what’s owed to them. You’ve got to own the process if you want to master your cash flow.
Here’s some tips to flip your receivables process from reactive to proactive:
Automate Payment Reminders:
Set up automated reminders to gently nudge your customers before and after the due date. People get busy, and sometimes a reminder is all it takes. Make paying you a priority.
Follow Up Fast:
If a payment is late, follow up immediately. Don’t wait weeks to chase an overdue invoice. Strike while the iron’s hot. Call your customers, send an email, and escalate if necessary. The sooner you follow up, the sooner you’ll get paid.
Create an Escalation Path:
When a payment becomes seriously overdue, you need a plan. Escalate the issue by sending a demand letter or involving a manager. You have to show that you’re serious about collecting what’s owed to you. Create a clear path of action for every overdue payment.
Strategy #4. Audit & Analyze Receivables
Here’s the deal. You can’t master cash flow if you don’t know exactly what’s going on with your receivables at all time. This means tracking every invoice and making sure nothing slips through the cracks. Here’s how to keep an eye on everything:
Use Aging Reports:
An aging report is your best friend when it comes to tracking unpaid invoices. It shows you how long invoices have been outstanding—30, 60, 90 days past due. The longer it’s outstanding, the harder it is to collect. Keep a close eye on these numbers and make sure you’re taking proactive action on overdue accounts.
AR Pro Tip: Challenge your team to decrease the number of 90-day overdue accounts over the next six months. If they do it, give them a small bonus. The amount spent on the bonus will be a fraction of the time and cost lost by letting your aging reports flounder.
For context, a healthy AR shouldn’t have more than 10% of their open invoices open 90+ days. Get your team to match that.
Monitor Cash Flow Projections:
Don’t just focus on the here and now—plan ahead. Cash flow projections allow you to anticipate future shortfalls or surpluses, so you can act accordingly. If you see that a major customer's payment is going to be delayed, adjust your spending or seek short-term financing to cover the gap. By being prepared, you’ll reduce the number of instances you’re caught up short.
Analyze Payment Behavior:
Are some customers consistently late? It’s time to start setting boundaries. Either adjust their payment terms or require a deposit before starting future work. Don’t let their bad behavior jeopardize your cash flow. Instead, leverage your customer data to better level up your business.
Strategy #5. Obsess Over Customer Experience
This is where most people drop the ball. Your customer relationships matter. When you maintain strong relationships, you create an environment where payments happen smoothly—and that means better cash flow for you. Here’s how to do just that:
Communicate Regularly:
Stay in touch with your customers throughout the project. Keep them updated, ask for feedback, and make sure they’re happy with the work. Satisfied customers are more likely to pay on time.
Handle Disputes Professionally:
Sometimes, a customer will dispute an invoice. Don’t let it fester. Address the issue head-on and professionally. Work to resolve it quickly, and get the payment back on track. Your goal is to maintain the relationship and get paid.
Focus on Customer Satisfaction:
Happy customers are loyal customers. And loyal customers don’t just pay on time—they come back for more. Deliver value, exceed expectations, and build lasting relationships. When you do that, your cash flow becomes a whole lot easier to manage.
Strategy #6. Adopt a Growth Mindset - Always Be Improving
Surely you’ve heard of a growth mindset. Success isn’t a one-and-done process. It’s a journey that requires continuous monitoring, analysis, and improvement. Stay on top of your systems, adjust your strategies, and never get complacent. The more you can apply that to each and every aspect of your business, the stronger your business and the faster your growth will be.
This includes cash flow. Always be monitoring, analyzing, and aiming to improve. If you can do that, you’ll be amazed at the difference. Here’s some tips to get you started:
Review Payment Terms Regularly:
As your business evolves, so should your payment terms. Review them regularly and make adjustments based on your cash flow needs. For example, consider shortening your payment terms from Net 30 to Net 15, or offer early payment incentives to encourage faster payments.
Forecast for the Future:
Use cash flow forecasting to predict future inflows and outflows. Whether it’s a 30-day or a 12-month projection, planning ahead helps you navigate challenges and seize opportunities.
Refine Your Processes:
Conduct regular audits of your receivables management process. Where are the bottlenecks? How can you streamline it even further? Pick a theme for optimization each month and focus on it relentlessly. Always be looking for ways to improve.
Read our article THE SECRET TO UNLOCKING YOUR CASH FLOW to discover even more about building a proactive accounts receivable process.
Make Leveling-Up Simple with a Technological Assist
Instead of taking all of the above and making a series of manual processes, leverage technology to streamline your receivables management, track your cash flow, and automate as much of the process as possible. New initiatives don’t have to take more time. Be efficient in your work and leverage technology.
While there are many ways to do this, here’s what we’ve found works best:
Automated Invoicing
Use software that automates the invoicing process. Set up rules to generate invoices based on project milestones or completion dates, and have them sent automatically. Optimize for efficiency.
Automated Payment Reminders
Set up automated reminders to go out at specific intervals. This keeps your invoices top of mind for your customers and reduces the likelihood of late payments.
Real-Time Cash Flow Monitoring
Use tools that give you a real-time view of your cash flow. When you can see exactly what’s coming in and going out, you’re in a position to make smarter financial decisions.
Integrate With Your Financial Systems
Make sure your invoicing and payment systems are fully integrated with your accounting software. This reduces manual data entry, improves accuracy, and gives you a complete picture of your financial health.
Give AR Workflow a Try
AR Workflow is the automated accounts receivable platform that we’ve designed specifically for the restoration business. You can automate invoices, set up automated payment reminders, monitor your cash flow and project status in real time, and integrate your invoicing and payment systems with your legacy accounting software. Always know what’s going on without losing time on analytics or clunky reports.
Do everything above and more with a platform designed to win back your time, turbocharge your business, and bring your collections to new, simplified, automated levels. Professionalize your communication, reduce human delay and error, and do more in less time with AR Workflow.
You think these strategies will make a difference? See what they’re like with AR Workflow on your side as well.
You know it’s true. Cash flow is the foundation of your restoration business’s success. If you want to grow, thrive, and build a future that excites you, you’ve got to take control of your cash flow—starting now.
The power is in your hands. Implement the strategies we’ve covered here, use the tools available to you, and never stop refining your process. When you master your cash flow, you unlock the ability to run your business on your terms. Bring the freedom to act, the confidence to take risks, and the financial strength to weather any storm to your business.
So, what are you waiting for? The time to act is NOW.
Let’s take control of your cash flow and unlock the future you deserve. A better version of your business is waiting. Let’s get it.
Start your free 14-day trial now and watch your business transform.
With AR Workflow you can:
Try our 14-day free trial and see the AR Workflow difference for yourself.
Take Back Control of Your Payments
and Your Restoration Business
Mortgage companies might be shaping the future of restoration payments, but that doesn’t mean you have to be at their mercy. By understanding their processes, building strong relationships, streamlining your operations, and managing your cash flow, you can take back control of your payments—and your business.
This is your business. Rise above the challenges, take control of the process, and create the space for exponential growth. The future is in your hands—are you ready to seize it?
Click here to sign up for your free, 14-day trial