Not quoting
Whose work do we stop pricing, and what would have to change for that to be reversed?
Customers affected
2 of 6
plus one standing rule about job size — reviewed with the price list, not when somebody is annoyed
Turnover this gives up
$533,000
26% of twelve months' billing, at an average gross margin of 16%
Stated at the top rather than buried. It is a real cost and the decision is worth what it costs.
Margin the waiting was eating
9%
of gross margin on that same work, before anybody counts the time spent chasing it
What has to be true before we stop quoting
- 1Their median is more than twenty days past their own terms, and has been for four quarters. One bad quarter is a clerk on leave.
- 2The wait is eating more than five percent of the gross margin on their work — roughly what we would give away for payment on invoice.
- 3It has been said to them, by a person, before it appears on this screen. Nobody finds out they have been de-listed by being quoted a strange price.
- 4Live contracts run to completion. We do not down tools over an accounts problem.
- 5Every entry carries what would reverse it. A refusal with no way back is a grudge.
Two of these were argued about for a year before anything was written down, which is exactly how long the screen took to build. The argument was never about the numbers — it was about whether anybody was allowed to say no to work.
Why this is not on the ledger screen
Because it would be read as a collections escalation, which is the opposite of what it is. Nothing here makes anybody pay faster and nothing here is aimed at the money currently outstanding — Cordell’s two live contracts run to completion and get chased exactly as they would have been.
It is a decision about the next quote, taken with the ledger open, and it belongs on its own page for the same reason a stop-carrying list does: a screen that only ever asks how to get paid faster will never once ask whether the work was worth doing.
Three decisions, with what reverses each one
Cordell Group
No new enquiries priced from 1 September. The two live contracts run to completion.
79 d median · 30 d terms · 16% margin · $441,000 billed
Seventy-nine days against thirty-day terms, worsening every quarter for two years, on our second-thinnest margin. Nine weeks of a four-hundred-thousand-dollar book funded out of our own overdraft is not a customer relationship, it is a loan we did not agree to make.
What reverses it · Reversed the quarter their median goes back under fifty, or on payment up front.
Kestrel Interiors
Priced at fifty percent up front, or not at all.
68 d median · 30 d terms · 14% margin · $92,000 billed
Sixty-eight days on fourteen percent. The margin does not survive the wait, and the work is small enough that nobody here would notice it stopping.
What reverses it · No review date. This is the terms we do business on now, and they may take them or not.
Anything under $4,000 on 60-day terms
Declined at enquiry, whoever it is from.
The invoice costs about six hundred dollars to raise, chase and reconcile. On a four-thousand-dollar job at twenty percent that is three quarters of the margin before anybody cuts steel.
What reverses it · Standing rule. Reviewed with the price list each January.
The third entry is a rule rather than a customer, and it is the one that has saved the most money. Every small invoice costs about six hundred dollars to raise, chase and reconcile whoever it is for — which means the cheapest thing on this page is not refusing a slow payer, it is refusing a job that was never going to clear its own paperwork.