The $500K Diagnosis I Made in 60 Seconds
The Contractor's Financial Blueprint
Saturday Newsletter
August 30 2025
Read on my website ⏱️ Read Time: 3 minutes 20 seconds
The $500K Diagnosis I Made in 60 Seconds
Hey Contractor Nation,
During my first meeting with Corey, I said something that made his jaw drop.
"Let me guess you need $500K to right the ship."
He leaned back. "Yes, I know that. But how do YOU know?"
"It's right here on your Balance Sheet."
Like a doctor reading X-rays before meeting a patient, I'd already diagnosed his financial health. The symptoms were clear as day. But diagnosing is easy. Understanding the "why" behind the numbers? That's where real healing begins.
The Financial Doctor Will See You Now
Good doctors review X-rays and blood work before seeing patients. I review Balance Sheets and P&Ls before meeting contractors.
Corey's Balance Sheet told me everything:
Current Ratio: 1:1 (treading water)
Equity: Negative $500K (drowning in debt)
A/R: $450K
Cash: $10K (basically vapor)
A/P: $460K
Revenue: $5M
If he collected every dollar owed, he'd have to pay it all out immediately. Growing but stuck. Like trying to fill a bathtub with the drain wide open.
The Prescription Nobody Wants
On Wednesday, I shared the two ratios and one number on your balance sheet that makes millionaire contractors. But knowing the numbers is just the diagnosis. The cure? That's different.
Most fast-growing contractors think revenue will solve everything.
Big mistake.
Chase had six-figure profit on his P&L. His bank account? Empty. Every week the same panic: chasing GCs for money, hiding from suppliers, sweating payroll.
Sound familiar?
His top line was growing. His cash was shrinking.
The Disease That Kills Growing Contractors
Commercial contractors average 56 days to collect. But here's the reality math:
Work 30 days
Invoice
Wait 30-60 days for payment
Actual collection: 90+ days
Meanwhile, you've made:
12 payrolls
3 rent payments
3 months of loan payments
Countless supplier bills
Get a $1M job when you're already cash-strapped? Congratulations—you just made the pain worse.
The Root Cause Nobody Talks About
Most contractors bootstrap their business: "I started with a pickup truck and a ladder."
Badge of honor? Sure. Smart business? Not anymore.
Here's the secret profitable contractors know: You can't fund growth on credit cards and merchant cash advances. Those 18-week MCA loans? They're financial chemotherapy—might kill the disease, but they'll nearly kill you too.
Corey needed permanent working capital. $500K over 5 years, not 18 weeks.
How did I know? Simple math:
Negative equity of $500K
Current ratio at life support levels
A $500K loan would put him ahead of the curve
Now the magic happens. Vendors get paid. Cash reserves build. Payroll panic disappears.
The Treatment Plan
Corey wasn't bank-ready. So we went to work.
First, we focused on the 7 Numbers That Make You A Millionaire:
Revenue Growth
Gross Profit Margin (THE most important number)
Overhead %
Net Profit %
Current Ratio
A/R Days
Equity Growth
Then we built his financial blueprint:
12-month budget
3-year forecast
Reverse-engineered from the bottom up
Started with the end goal: $1M free cash flow. Then, we worked backwards to find the revenue and margins needed.
Even a $5M contractor should clear $500K-$1M. Not overnight. But with a roadmap? Absolutely.
Your Turn
Pull your Balance Sheet right now. Calculate your current ratio.
Below 1.25? You're feeling it. That stress isn't in your head—it's in your numbers.
Want to learn how to diagnose and cure your cash flow problems? I'm hosting a virtual workshop for my clients, and you can join as my guest. It's on September 9th @ 11am EST - "The 7 Numbers That Make You A Millionaire."
We'll dissect real Balance Sheets, fix broken ratios, and build your millionaire blueprint.
Because Revenue for Show. Profit for Dough. But knowing how to read your financial vital signs? That's what keeps you ALIVE.
To your financial health,
Patrick Shurney, MBA
Founder, 3P Consulting
📞 443.539.6276
Helping Contractors Become Bankable, Bondable, & Capital-Ready
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About Me:
As a veteran in financial coaching with over 30 years of corporate banking experience, my mission is to empower trade contractors like you to become numbers confident, optimize cash flow, leverage debt, and pay yourself competitively.
Ready for More?
Here’s how I can help you:
1. Profit Blueprint Program: Get your finances sorted and build out a 3-year financial roadmap in the next 30 days.
2. Loan Consulting: Get Bank Ready. With 30+ years of banking experience, I’ll make sure you're ready to approach lenders with a winning loan package.
