Construction cash flow: build a 13-week forecast for your building business
By Smart Way Builds · Updated
A profitable building job can still leave you short of cash. Materials and subcontractors may need payment before a customer's progress payment arrives. Construction cash-flow planning makes that timing visible before it becomes a supplier call you cannot answer.
A practical starting point is a rolling 13-week forecast. It is a planning worksheet, not an accounting cash-flow statement or a promise about when customers will pay. Update it weekly and keep a separate view of job profit.
What belongs in a construction cash-flow forecast?
Start with available business cash, then list expected receipts and payments by the week cash will actually move. Do not use the invoice issue date as a substitute for a realistic receipt date.
- Customer receipts: expected progress payments and other collections.
- Job payments: materials, subcontractors, direct wages, equipment hire and deposits.
- Business payments: office costs, insurance, loan repayments and other overheads.
- Tax and payroll obligations: amounts and dates checked with your accountant.
- Financing and owner movements: shown separately rather than called job revenue.
Use GST-inclusive cash movements where GST is actually paid or received, and separately plan tax settlements. This differs from a GST-exclusive job-margin comparison. Do not assume collected GST is all available to spend; your accounting method and credit eligibility matter.
A worked four-week extract
Fictional business-wide AUD cash amounts, including any GST within the listed receipts and payments. These are not construction prices or a product-generated forecast. Tax settlements are assumed outside this four-week extract and must be added when due.
| Week | Opening cash | Receipts | Payments | Closing cash |
|---|---|---|---|---|
| 1 | $30,000 | $20,000 | $25,000 | $25,000 |
| 2 | $25,000 | $0 | $18,000 | $7,000 |
| 3 | $7,000 | $35,000 | $22,000 | $20,000 |
| 4 | $20,000 | $15,000 | $17,000 | $18,000 |
Closing cash = opening cash + receipts − payments. Carry each week's closing balance into the next opening balance. Week 2 is the lowest point here, even though the four-week total finishes positive.
Stress-test a late progress payment
If the $35,000 receipt moves from week 3 to week 4, week 3 closes at negative $15,000: $7,000 − $22,000. Week 4 still finishes at $18,000 after the delayed receipt, but that does not solve the earlier shortage. A positive month-end balance can hide a mid-month problem.
Mark uncertain receipts, test realistic delays and decide what to do before the low point: clarify claim evidence, follow up collections, review discretionary purchases or discuss suitable finance. Do not assume you can delay agreed supplier payments without consequences.
Keep the forecast useful each week
- Replace the finished week's estimates with actual cash movements.
- Update receipt dates using current customer information.
- Add approved unpaid invoices and known upcoming purchases.
- Check wages, overheads and tax dates across the business, not just one job.
- Add another week at the end and record why assumptions changed.
Use job budgets and invoice records as inputs, not as a complete cash forecast. Smart Way Builds distinguishes approved costs from paid records; a future receipt date and remaining-cost assumption still need your review.
For general guidance, see business.gov.au's cash-flow guidance. Read our progress-claim checklist and month-end bookkeeping checklist, or explore job finance tools.