Vineland faces a cash-flow problem

Last time we checked in:
Will Gruccio and his partner Michael D’Orazio were subbing some maintenance work to another company for the first time, and debating whether to drop construction work. They also discussed pre-billing maintenance work and visiting a similar company with higher revenue.

Latest update:
The biggest hurdle facing Vineland is having cash on hand because the big checks from construction jobs haven’t come in yet – those jobs are slated for the fall. Vineland hired a part-time employee to help with collections, and the company will start to pre-bill mowing jobs each month despite a few long-time customers saying they didn’t like the idea.

“It’s at the point where I’d rather lose an account and have our business run smoothly than every week us being worried about cash on hand,” he says.

Gruccio says he hopes to start billing in October of this year as a trial run. He plans on sending a letter with an invoice to customers explaining the change.

If customers who pay on time complain, they will return to the old process for those customers.

Vineland has also been getting burned by general contractors not paying on time. Gruccio is putting language in contracts saying some money should be paid up front.

The company is also reducing overtime. They will allow experienced workers to get overtime, but as less experienced workers hit 40 hours, Vineland will have a part-time worker jump on a job.

Bill and Ed’s take:
Vineland is getting killed on their subcontractor work and would like to see the company move away from working as a subcontractor. The Harvesters also encouraged the company to look for new maintenance work to replace the commercial construction revenue.

“Throughout the winter they can be making calls on commercial work to grow that side of the business,” Ed says. “They’ve got six months or so to replace the construction work and I believe he can do it without any problems.”