Cashflow for UK Trades: A Practical Guide to Staying Paid and Predictable

When you're busy, it's easy to confuse 'lots of work' with 'healthy cashflow'. This guide gives you a lightweight system for deposits, stage payments, invoicing, and chasing — without awkwardness.

Why Cashflow Breaks for Trades

Long gaps between quote → start → completion → invoice → payment can starve you, even on profitable jobs. Here's the typical timeline:

• Week 1: Send quote
• Week 2-3: Customer accepts, job scheduled
• Week 4-6: Job in progress (you're paying for materials and labour)
• Week 7: Job completed, invoice sent
• Week 9-11: Payment received

That's 9-11 weeks from quote to payment. Material-heavy jobs magnify the problem: you pay suppliers now, but customers pay you later. If you're doing multiple jobs simultaneously, the cashflow gap becomes a chasm.

The solution isn't working harder—it's structuring payments to match your cash outflows.

Use Deposits and Stage Payments (Even on Small Jobs)

Many tradespeople think deposits are only for large jobs. They're wrong. Even a 20% deposit on a £500 job covers your materials and gives you breathing room.

Set a default payment structure:

• Deposit on booking: 20-30% to secure the slot and cover initial materials
• Stage payment at first fix: 30-40% when key work is complete
• Final payment on completion: Remaining balance before you leave

Write it clearly on the quote so it feels normal, not negotiable. Use language like "Payment terms: 30% deposit on booking, 40% at first fix, 30% on completion."

For smaller jobs (£200-500), a 50% deposit + 50% on completion works well. The key is consistency—customers accept what they expect.

Invoice Cadence That Actually Works

The biggest cashflow killer is delayed invoicing. Invoice the same day work is completed (or milestone hit). Delay equals forgetfulness — yours and theirs.

Here's a system that works:

• Complete job → Invoice immediately: Don't wait until Friday or "when you get a chance"
• Pick a weekly invoicing block: Friday afternoons work well for most trades
• Protect it like a job booking: This time is non-negotiable
• Use templates: Pre-filled invoice templates save time and reduce errors

If you're using trade management software, set up automatic invoice generation from completed jobs. This eliminates the delay between completion and invoicing.

Include everything on the invoice: clear description of work, payment terms, bank details, and a due date (typically 7-14 days for trades).

Chasing Without Stress

Most tradespeople hate chasing payments. They worry about seeming pushy or damaging relationships. But professional follow-up isn't pushy—it's necessary.

Use a simple three-touch follow-up system:

• Day 3: Friendly reminder email/text: "Hi [Name], just checking you received the invoice for [Job]. Happy to answer any questions."
• Day 7: "Just checking' message: "Hi [Name], following up on invoice [Number] for £[Amount]. Due date is [Date]. Let me know if you need anything."
• Day 14: Firm deadline: "Hi [Name], invoice [Number] for £[Amount] is now overdue. Please arrange payment by [Date] or let me know if there's an issue."

Always include: invoice number, amount, bank details, and a one-line summary of the work. Make it easy for them to pay.

Track follow-ups in your system. If it's not scheduled, it doesn't happen. Set reminders when you send the invoice.

Remember: you're not being difficult—you're running a business. Professional customers expect professional payment processes.

Build a 4-Week Forward View

Cashflow problems are predictable if you look ahead. Every Friday, spend 10 minutes mapping your cashflow for the next 4 weeks:

• Cash in: Expected payments from completed jobs and deposits
• Cash out: Materials, wages, vehicle costs, overheads
• Gap analysis: Where are the shortfalls?

If there's a dip, you fix it early:

• Push invoicing forward (invoice as soon as milestones are hit)
• Collect deposits earlier
• Adjust scheduling to bring forward cash-generating jobs
• Chase overdue invoices more aggressively

A simple spreadsheet works, but trade management software can automate this view. The key is doing it weekly, not when you're already in trouble.

Handle Payment Problems Professionally

Sometimes customers genuinely can't pay on time. Here's how to handle it:

• Listen first: Understand their situation before reacting
• Offer solutions: Payment plans, partial payments, extended terms
• Get it in writing: If you agree to new terms, confirm via email
• Know your limits: Don't let one customer's problems become your crisis

For genuinely problematic customers, consider:

• Requiring full payment upfront for future work
• Adding late payment fees (legally, you can charge 8% + Bank of England base rate)
• Using a debt collection service for persistent non-payers

Use Technology to Your Advantage

Modern trade management software can automate much of this:

• Automatic invoice generation: From completed jobs
• Payment reminders: Scheduled follow-ups
• Cashflow forecasting: 4-week forward view
• Payment tracking: See what's overdue at a glance

The time saved on manual invoicing and chasing pays for the software many times over.

Common Cashflow Mistakes to Avoid

• Waiting to invoice: Every day of delay is a day without cash
• Not collecting deposits: You're financing the customer's job
• Ignoring overdue invoices: The longer you wait, the harder it gets
• No forward planning: Surprise cashflow gaps cause stress and poor decisions
• Mixing personal and business finances: Makes tracking impossible

Getting Started

Start with one change this week:

1. Add deposit terms to your next 3 quotes
2. Invoice every completed job the same day
3. Set up a Friday cashflow review

Small changes compound. In 4 weeks, you'll have better cashflow visibility and fewer payment problems.

Want help automating your invoicing and payment tracking? Start a free 14‑day trial of TradePlan. No credit card required.