Payment uncertainty is a matter of course for engineering firms, especially when work is carried out on a subcontractor basis.
As progress and final payments are tied to specific project milestones, payments are often delayed as deadlines shift. As a result, expenses for projects, such as payroll, are divvied out long before payment is received for that work.
This often creates cash-flow difficulties that can eat into working capital for engineering firms. Such was the case for HM3 Engineering Consultants, a firm specializing in mechanical, electrical and plumbing design in the city of San Antonio.