Cash Flow Management

Purpose

Defines how Spartan monitors and manages cash flow — ensuring the business always has sufficient cash to pay vendors, make payroll, and invest in growth without surprises. ## Who This Applies To

Josh (owner) and the Office Admin (accounting). ## Key Cash Flow Levers at Spartan

### Inflows

- Service call collections — collected at time of service (ServiceTitan invoices)

- Install deposits — 40% non-refundable deposit collected before job starts

- GoodLeap financing payouts — released after customer confirms job completion and satisfaction

- Home warranty reimbursements — subject to warranty company caps and processing time

### Outflows

- Payroll (Paylocity, bi-weekly or weekly)

- Vendor payments (Tradeshift — materials purchased for jobs)

- Fleet expenses (Enterprise gas cards, vehicle maintenance)

- Overhead (insurance, technology, facility)

## Deposit Policy — Critical Cash Flow Tool

Spartan's current deposit policy: 40% non-refundable deposit required before commencing work on any install/estimate job.

This policy was changed from 20% to 40% — techs must sync the updated ServiceTitan price book to reflect current terms. The 40% deposit protects cash flow on large jobs where significant material costs are incurred upfront. Deposit exception: If unforeseen issues arise during a job (e. g. , unexpectedly thick concrete) and the customer declines to increase the budget, the deposit is non-refundable. It may be applied toward a modified scope of work. ## Cash Flow Monitoring

- Weekly: The Operations Manager reviews accounts receivable aging. Any invoice over 30 days past due goes on a collections watch list. - Monthly: Review cash position against next 60 days of committed outflows (payroll, rent, known vendor payments). - GoodLeap jobs: Monitor completion status — GoodLeap will not release payment until customer satisfaction is confirmed. Do not let GoodLeap jobs sit unclosed. ## Payroll Cash Planning

- Payroll is the largest recurring outflow. - Commission timing: Commission is paid only on fully collected jobs. If a large install is not yet collected, the commission is held until payment clears. (Slack policy)

- EWS (Emergency Weekend Service) pay is calculated separately and added to the check. - Weekend hours count as overtime even if the employee calls off Monday — plan for this in payroll cash requirements. ## Cash Flow Stress Signals

If cash is tight:

1. Review accounts receivable — chase any past-due invoices immediately. 2. Delay discretionary capital purchases (new equipment, facility improvements). 3. Confirm all GoodLeap jobs are properly closed and payout requests submitted. 4. Review Tradeshift for any open material orders that can be deferred. ## Important Notes

- Never miss payroll. If cash is tight, Josh must know by Wednesday of payroll week. - The 40% deposit is a cash flow protection mechanism — enforce it without exception unless Josh specifically approves otherwise. - Cash price discounts are not offered — this is both a tax policy and a cash flow protection rule. ## Related SOPs

- P&L Review Process — profitability vs. liquidity

- Annual Budgeting Process — cash planning

- Billing & Accounting — invoice and collection processes