Tresswell Consulting Group
Costs & performance

Revenue is growing. Why is cash still tight?

Separate sales, contribution and payment timing before deciding what growth really means.

Start with three different questions

Sales tell you what has been sold. Contribution shows what remains after the direct costs of delivery. Cash tells you whether money is available when payments fall due. Reviewing one without the others can leave an important part of the picture unexplained. Business Wales distinguishes cash movement from accounting profit in its guidance on cashflow forecasting.

Follow the timing

Take one typical job. When is the customer invoiced? When is payment expected? When must suppliers and staff be paid? Put those dates beside the amounts. A growing order book may require spending before the associated receipts arrive. The useful question becomes when the gap opens and how large it could be.

Use a small worked example

Illustration only: work invoiced at £10,000 has £6,000 of direct delivery costs. That leaves £4,000 of contribution before overheads, tax and financing. If the £6,000 is paid before the customer pays, contribution alone does not describe the cash requirement. This example is not a forecast or a client result.

Make the review actionable

Compare expected and actual receipts, identify overdue invoices and record the assumptions behind upcoming payments. Assign a person and review date to each material uncertainty. A forecast is more useful when it prompts a specific action than when it simply produces another total.

Original worked illustration / Fictional figures

One job. Three different views.

Assume £10,000 is invoiced for completed work. £6,000 of direct costs must be paid in week one; the customer is expected to pay in week four. No other cash movements are included.

Illustrative job economics and cash timing, not a complete business forecast.
Review lensWhat the example showsWhat it does not establish
Revenue£10,000 invoicedWhen the cash is received
Contribution£10,000 − £6,000 = £4,000Net profit after all business costs
Cash timing£6,000 paid before the £10,000 receiptThe business’s total cash position
WEEK 1£6,000 out

Direct costs paid

WEEKS 2–3A timing gap

Receipt still outstanding

WEEK 4£10,000 in

Assumed customer receipt

The timing illustration assumes the receipt arrives as expected. It is not a financing recommendation. Business Wales supports the distinction between profit and cashflow; these numbers and the presentation are Tresswell’s own illustration.

One practical action

Map the receipt and payment dates for your next three significant jobs. Review the largest timing gap before committing further spending.

Further reading: Business Wales: Cashflow forecast ↗. Accessed 8 November 2026.

External sources inform the points attributed to them. The practical application and examples are Tresswell’s interpretation. No endorsement is implied.

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