Drywall projects live or die on cash flow—late payments from general contractors can squeeze your crew payroll and material costs. Getting paid faster and tracking invoices properly separates contractors who grow from those who struggle month to month. Here's how to build a payment system that keeps money moving.
The Payment Problem in Drywall Work
Most drywall contractors work on net-30 or net-45 terms with general contractors and builders. That means you're fronting labor and materials for 30–45 days before seeing payment. If a project runs 4–6 weeks and payment takes another month, you're out of pocket for 8–12 weeks. With crew wages due every other week, this gap creates real strain.
Typical drywall projects range from $3,000 for small residential patches to $50,000+ for commercial builds. Even a $15,000 job sitting unpaid for 6 weeks ties up capital you need for the next project.
Structure Invoices for Faster Payment
Invoice in phases, not at completion. Break large jobs into progress milestones:
- Framing and hanging: 40% of contract value
- Taping and mudding (first coats): 35%
- Final finishing and paint prep: 25%
This spreads payment and gives you cash before the job ends. Submit invoices the same day work is completed—delays in paperwork add days to payment.
Include these specifics on every invoice:
- Project address and job number
- Exact scope of work completed (don't just write "drywall work")
- Square footage hung, linear feet of tape applied, or rooms finished
- Material costs itemized separately from labor
- Your payment terms clearly stated
- Due date, not just "net-30"
- Your contact info and preferred payment method
Negotiate Terms Before Work Starts
Don't accept vague payment language. Get written agreement on:
- Specific due date (not "within 30 days")
- Retainage percentage, if any (many GCs hold back 5–10% until final walkthrough)
- Late payment penalties (1.5% monthly interest if overdue)
- Dispute resolution (how you handle payment disagreements)
For residential work with homeowners, require 50% deposit and 50% due upon completion. For commercial and GC work, get this in writing on your estimate or contract.
Track What You're Owed
Use accounting software or a simple spreadsheet to track every invoice:
- Invoice date
- Amount
- Due date
- Date paid
- Days outstanding (actual payment date minus due date)
If an invoice hits 15 days past due, send a follow-up email the same day. Most delays are clerical errors, not unwillingness to pay. A quick "Hey, I sent invoice #1247 on [date] for the [address] project—can you confirm receipt?" often gets a same-day response.
For jobs over $5,000, call the GC's accountant directly. A 2-minute phone call beats a week of email chasing.
Reduce Days Sales Outstanding
The industry benchmark for drywall contractors is 35–45 days from invoice to payment. Aim for 30 days or less.
Strategies that work:
- Offer a 2% discount for payment within 7 days (costs you roughly $300 on a $15,000 job but saves a month of cash flow stress)
- Require retainage release within 10 days of final inspection, not when the whole project closes
- Use online invoicing tools that send automatic payment reminders
- List your business on Mercoly to attract higher-quality GC and builder relationships who prioritize reliable subcontractors
When Payment Stops Coming
If an invoice is 30+ days overdue:
- Email a formal past-due notice with specific dollar amount and original due date
- Call the GC's project manager and accountant directly
- Stop work until payment clears (get agreement on this in your contract)
- Send a lien notice if your state requires it and payment is 45+ days overdue
Don't let pride delay action. A $10,000 unpaid invoice ties up cash and time you should spend on profitable work.
Frequently Asked Questions
Q: Should I ask for payment upfront on small residential jobs? Yes. For jobs under $5,000, request 50% deposit at signing and 50% on completion. Homeowners expect this, and it protects you if they disappear mid-project.
Q: What should I do if a GC disputes part of my invoice? Document everything—photos of the work, crew timesheets, material receipts. Separate the disputed amount and invoice the rest immediately; resolve the dispute separately.
Q: How do I handle retainage that never gets released? Include retainage release language in your contract upfront: it's due 10 days after you pass final inspection, not when the whole building is done. Follow up in writing 5 days after inspection.
Get your payment terms locked down before you pick up a tape knife.